Freelancers play a very important in the startup ecosystem today. Here are 4 important steps for ... [+]
Fifteen years ago, the thought of hiring complete strangers to build a startup app idea was out of the question for most entrepreneurs. Today, I could spend the whole day citing studies backing the significant contribution of freelancers to the startup community and the world economy at large.
When I started my first startup venture back when I was a Sophomore in college studying business, I didn’t have the programming skills to build my product. I thought it was impossible to bootstrap my venture without funding to hire and manage people with complementary skills. Freelancers made it possible.
One of the biggest lessons I learned working with over 70 freelancers over the years is that hiring the wrong freelancers and failing to carefully manage the projects will end up costing more than taking a more traditional full-time hiring approach.
In the case of application development, it can take months and tens of thousands of dollars to realize the product doesn’t meet expectations. Most entrepreneurs quit at this point after incurring a big loss without even getting to market. Making the same mistake twice is deadly. Follow these steps to hire freelancers that can increase the probability of success of your startup app idea.
1. Do Your Startup Homework
No matter the complexity of your introduced concept, there are many ways to test your business hypotheses before building an app. Getting hands dirty to maximize customer understanding in the initial stages will help you define what you need to build with higher certainty.
Like any business, startups require an investment. A big chunk of this investment is time. Funded or bootstrapped, it’s usually cheaper to waste time than money especially in things that can be tested by interviewing your potential buyers and using no-code tools to create quantitatively testable prototypes.
Once you’ve exhausted all channels to gather feedback, build an audience and perhaps even presell an idea before building the app, you’ve completed your startup homework and should be ready for the next stage. This first homework phase will also help you answer a very important question: is my idea even worth pursuing? If the answer is NO, it would have been very expensive finding this out after building an application.
2. Look For Entrepreneurial Freelancers
Picture this, you’ve been assigned a project with clear requirements. After spending weeks making a significant progress, your boss asks you to make changes that set you back weeks. A few weeks later, you get another call with more changes and additions. How would you feel?
This perfectly describes the nature of building a startup and how most freelance programmers feel about constant changes in project requirement. Even if they are compensated on an hourly basis, you’ll soon start feeling resistance and objections to many changes. You’ll hear comments like, “this will set us back a few months,” “why don’t we launch this version first,” “this will delay launch and significantly increase costs,” etc.
What you need is entrepreneurial freelancers. Those are entrepreneurs who offer freelance services but also have started and run several entrepreneurial projects. It’s not that freelancers with an experience building startups won’t occasionally disagree with changes in project scope, they’re different because they can ask you the right questions, help you design the best launch plans and guide you to build a successful venture.
If it’s the first version of your startup app idea, entrepreneurial freelancers will make sure you only build the needed features that will allow you to test the riskiest assumptions quickly. They’ll help you analyze data and translate feedback into features that people need. They’ll tell you when it’s the right time to iterate, pivot or change ideas completely. Essentially, they’ll help you build a startup not an app. It’s easy to build an app, the question is how to build an app that people use and pay for.
3. Set Business Goals
Entrepreneurial freelancers would understand this even if the performance of the startup may not be solely dependent on the quality of the product they build. Business goals like signing the first 50 beta testers, acquiring the first 10 paying customers, or building the first key partnership will help the freelancer do a better job in terms of defining project requirement, timelines and priorities.
Traditionally, building technology products starts by creating a project scope that lists the features, requirements, deadlines and costs. Freelancers are hired to turn a dozen pages into a functional application.
Product development changes happen when the freelancers are not involved in the startup. It’s when founders talk to more people, run more tests and realize things must be done differently. This creates tension, resistance and disagreements. Make sure to evaluate and define business goals with your hires. It will make their job easier and more fun.
4. Compensate Fairly
Freelancers run a business. Betting on a startup idea that may realize a return a few years later is not going to pay the bills today. While hiring freelancers is in my opinion one of the best ways to turn an employer/contractor relationship into a co-founding partnership, until then, be sure to compensate them fairly so that they don’t have to think about the money in your partnership building the startup.
An equity agreement or a promise of a future increase in payment will most likely turn badly once the first version of the product is out. When inexperienced freelancers realize the amount of time it will take them to reach later stages in the business, they start losing interest. This usually doesn’t take long.
Lastly, the most important freelance hiring tip is to understand that startup development cannot be outsourced. Not even the most committed freelancers in the world will be able to build your startup for you, care as much as you do and be as passionate as you are. Hire the right freelancers to make your job easier as a founder.
