Robert Vlach: Freelancing is the simplest approach to doing business
(Interview) Robert Vlach explains in his best-selling book The Freelance Way why freelancing is easier than other ways of doing business: “You don’t need an artificial brand and the capital needs are very low, but there’s a catch.”
You had the opportunity to compare the state of freelancing in various countries. Are there any major differences between them in terms of recommended business know-how?
Not really. There are small differences, but the essential know-how for freelancing is quite universal. For example, my book went through a peer-review process with experienced freelancers from all over the world, yet their views on the important issues were basically the same as mine. I believe it is partly because the ethos of the free trades and independent professionals is rooted in our ancient history, in the Roman times and beyond. In our free, Western society, we all draw on these cultural roots, meaning that we share a certain ideal or archetype of how a real professional acts and behaves. It may differ in the details, but the essential elements are more or less the same: a deep level of expertise, long-term experience, professional knowledge, authenticity, honesty, reliability, diligence, a good name, a great attitude towards us as customers, etc.
If the business essentials are universal, what are some of the major differences between countries in other aspects?
When we look beyond the individual and compare national freelance economies and how advanced they really are, the differences are striking. In advanced freelance economies like, say, the USA, the UK, the Netherlands, or Czechia, where I am based, far more professionals are successful both as experts and entrepreneurs. They have high earnings as well as social standing and influence. They willingly cooperate on larger projects with other freelancers, whom they view as colleagues, rather than competitors. They often share their know-how, and the top ones can also manage quite large projects. Another sign of an advanced freelance economy would be that there are functional communities of independent professionals and that established experts don’t feel that they are disadvantaged in any way when compared to their agency or company peers. Even established experts have to work hard though, to sustain their income and living standards. Freelancing is not a free meal ticket.
You wrote in The Freelance Way that freelancing is the simplest kind of business out there, but only in a relative sense. Why?
The freelance way of doing business is minimalistic in most aspects. A typical freelancer doesn’t need to create an artificial brand, because they operate under their own name. The capital needs are also very low. Freelancers need mostly personal, intangible human or social capital to succeed: expert knowledge, skills, certifications, but also essential business know-how, contacts, a good name and so on. Starting a business usually doesn’t require a substantial investment. Many freelancers start with just a laptop computer, mobile phone, a desk at home or a car and a small financial reserve. Starting out as a freelancer can be really easy, and can even happen inadvertently. I’ve heard countless stories of independent professionals who took on a side job here and there and as the number of these gigs grew, they suddenly realized they were actually running a business. Few freelancers start with some preconceived, well-designed business plan, starting off with some small jobs is much more common. Growing a freelance business can be fairly slow, but also free of major risks given the low capital needs. Most of the risks come later, when a professional needs to meet ever higher client expectations and demands, while also staying organized, focused, and healthy as well as prepared for any unexpected drops in income. Thus, freelancing is relatively simple compared to other ways of doing business, but not easy in the absolute sense. As a business consultant I would say that even the simplest business is still quite demanding.
Who is a typical freelancer?
Typically full-time freelancers are individuals who operate on the open market under their own name and with a publicly declared area of expertise, profession, or trade — and this is precisely why we hire them. In short, full-time freelancers are self-employed experts operating on a free market, but there are many other definitions of freelancing including those that count anyone earning a small extra income on the side. With the broad definition, a freelancer can be someone doing less qualified and badly paid on-demand work (through an agency or some app), as well as an elite professional charging thousands of euros per day, or even a celebrity in a given field (a famous host, actress, chef, etc.). This vast diversity and variety is typical for freelancing. From the expertise point of view, typical freelancers are IT experts and developers, marketers, writers, translators and interpreters, trainers, graphic designers, creatives and artists, consultants, accountants, virtual assistants and other pros that provide business support or personal services. I should also mention trades or people who lease their assets. What matters is that one way or another these are free agents, professionals or experts who make their living on the free market.
What are the main reasons for people to stop freelancing?
There are many, including a lot of emotional ones. After all, emotional factors dominate the pros and cons of freelancing in surveys. Some people may find out that they hate being freelance, others may feel exhausted after some period of time, or just cannot handle the pressure of uncertainty and the financial swings that usually come with running a business. You may invoice thousands of euros in a single month and only a few hundreds in the next one. The costs also fluctuate. There may be a larger-than-expected tax bill or a sudden need to buy some expensive equipment or software and not everyone is able to manage it financially. One of the most common reasons to stop freelancing is therefore, quite logically, money. Freelancers who can’t cover their needs with their income either switch to employment or they keep on working for a single client as contractors. A personal business can’t be losing money long-term and in most cases it also doesn’t make sense to subsidize it from savings or a family budget. A more sensible decision would be to try again in a better way after some time, say, in a related field.
Facing uncertainty surely isn’t everyone’s cup of tea. Are younger people any different in this regard?
One of the annual Deloitte Millennial Surveys suggested that young people in developed countries prefer the certainty of a permanent job’s income, but ideally when it is combined with a freelancer’s flexibility. They prefer to work flexible hours, to work remotely from almost anywhere, to be able to choose meaningful projects to work on within a company and so on. Addressing this need for certainty combined with a greater flexibility is actually a good hiring strategy for companies looking for knowledge workers. The worlds of freelancers and employees are growing closer to one another. The coronavirus crisis is only accelerating this trend of wanting greater flexibility. I would say that younger people are more assertive when it comes to designing their own work and self-development is a natural concept for many of them.
How important is self-development in growing a personal business? How popular is it among freelancers?
Self-development and (self)education are crucial for freelancers. Independent professionals often have a great need to invest in their own development, which is logical, because they are the primary movers of their own success. Most of them also realize sooner or later, how important it is for them to stay healthy and take care of themselves. It relates to their diet, exercise, having enough sleep, the ability to balance their life and business in a sustainable way, etc. Another popular area for improvement is personal productivity or self-management, including finance. Any personal growth is then projected into an overall value created by their work (prices and incomes with it). Every freelancer who succeeds in working their way up to a higher standard of living, has enormous interest in keeping it. That also drives their motivation to keep on working on themselves, eliminate risks, grow and to be able to perform over the long-term in a stable way.
You dedicated a full chapter to personal productivity in your book. How to tackle it?
Freelancers are enormously interested in personal productivity, because this also has a great impact on their incomes. That’s hardly news. What has been changing over time though, are the trends and tools that freelancers use to boost and support their productivity. It is a very diverse subject, but if I had to simplify it, the usual goal is to improve the three major pillars of productivity. The first one is to have a good management over your priorities — from the deeper and permanent ones, over long-term ones, down to the weekly or daily ones. The second pillar represents the work with one’s energy and overall fitness. We’re human beings, not machines, and our performance therefore fluctuates over time. It’s useful to know when my performance usually peaks and adapt my work by planning around that. Our biorhythm is also greatly influenced by sleep and by having a healthy lifestyle in general, moving enough, eating healthfully, a reasonable consumption of alcohol, the absence of conflicts and so on. In this regard, freelancing can be compared to professional sports — for freelancers to perform well on a long-term basis, they need to be able to control their well-being and all the major performance factors. For some freelancers, the first two pillars are more than enough, but the rest of us rely on the third one as well — the tools of productivity. I’m talking about various techniques, apps, and productivity hacks. These enable us to manage a greater range of situations, coordinate teamwork effectively and so forth. But we all prefer different tools based on the nature of our work and personal preferences, so we need to experiment and try a number of them out to find the ones that fit and are able to stick.
You have mentioned that financial self-management represents a risk for freelancers. How far do freelancers go in preventing it? And what would you recommend?
Financial swings in terms of fluctuating earnings and costs are a major concern for freelancers according to all surveys. Freelancers often struggle emotionally even with minor, short-term swings. Sadly, one of the reasons is that they don’t pay enough attention to this problem and manage their finances more or less intuitively. For example, according to the 2018 Freelancing in America survey, only 41% of full-time freelancers understand their finances. That is truly alarming and based on my experience, pretty much the same elsewhere. Luckily, financial self-management can be improved substantially in no time. What I recommend is a gradual improvement of control over one’s own finances. In my book, I compare it to a conventional education, from elementary school to a PhD. First, there is the basic recording of monthly revenues in a spreadsheet, along with a nice graph or two. Then there is a financial overview with a strong financial reserve, and learning to watch your cash flow. Then there’s financial planning with alternative income scenarios. And finally, there are smart investments and savings for retirement and wealth management, with all of these levels logically combined in an effective and unobtrusive system that can be modified and amended in any way necessary. I really love to speak about financial self-management in simple terms, because a great number of freelancers really hate the subject, which is also a source of great anxiety. Starting small and gradually improving the control over finance is therefore better than going all-in into such a complex managerial challenge.
Incomes can be also improved by working for international clients. What are the recommended steps to do so?
It pretty much depends on the profession. It will always be easier, say, for a web developer than a massage therapist. Speaking international languages is obviously essential, especially English. What usually works are simple, rational steps: a comprehensive LinkedIn profile or interesting social media profiles, a well-written web page in English (see profiles in our Freelacing.eu freelance directory), or becoming a contractor for a single international client as a sort of test run. I would also recommend following or approaching freelancers, who have experience with international projects. You may meet them in coworking spaces, at meetups, in local freelance communities as well as online — we curate a large directory of European freelance platforms at Freelancing.eu, check it out. If you tell colleagues about your intentions, it is very likely that sooner or later you’ll get an opportunity to do something international. Go step by step and be patient, you don’t need to conquer the world all at once. Gradual improvements are usually better than sophisticated strategies that are not rooted in hard realities.
The Freelance Way seems to be your ticket to the international scene. What are your plans for it?
I’m truly happy that the book is being sold worldwide through Amazon and other vendors and I have already been getting lots of great feedback. We’ve agreed with my publishers at Jan Melvil Publishing and their rights representative Scott Hudson that the main goal is to form partnerships with local publishers all over the world to publish as many translations as possible. Some publishing rights have already been sold and we keep on working with renowned literary agents who represent the book in their respective regions. When it comes to my daily work, I am mostly involved with our new European platform Freelancing.eu, where we are trying to rewrite the rules on how freelancers can present themselves on the international level. Each member profile is written by a copywriter and it is open to the general public including contact details. We have been using the exact same model with our Czech platform since 2005 and it works great. As you can see, I am a strong believer in an open Internet and the free market for professional services.
This is an expanded version of an interview for E15 magazine by Jana Poncarova, a freelance journalist and best-selling author of several books, all related to women and their destinies in the 20th century and the modern era.
Robert Vlach is a senior business consultant, specialized in supporting independent professionals and business owners. In 2005, he founded one of the largest national freelance communities in Europe that is now being expanded into Freelancing.eu. In 2012, he founded Europe’s first think-tank for freelancers which meets regularly in Prague and other cities. He has been holding freelancing courses for more than a decade, and has consulted on over 300 business cases with individuals, startups, and companies. His book about freelancing became an instant national bestseller and is now being sold worldwide as The Freelance Way. Robert lives with his family in the Czech Republic and Spain.