Last week, I was forced to take an impromptu vacation.
With Hurricane Florence barreling toward the east coast of the United States, I was persuaded to flee north by a combination of The Weather Channel, scaremongering Facebook posts, and calls from my parents.
The result? A few days in Gettysburg, Pennsylvania and zero work accomplished, despite having my laptop in tow.
(I don’t know about you, but I always overestimate my ability to get anything done when on the road.)
For my area at least, it was a bit of a non-issue. I think a few trash bins blew over, but weather is unpredictable – and evacuating was the right thing to do.
But guess what?
Even though I took the entire week off, my finances were unaffected. People, presumably those who weren’t in the path of a hurricane, still bought from me last week.
It was a good week.
Many of us pursue freelancing for the freedom.
We want to be able to evacuate our homes, either for hurricanes or for getaways to the Caribbean, and have as little impact as possible on cash flow.
Based on the discussions I’ve had with so many of you, the real draw is financial freedom… and the leverage that freelancing affords over full-time employment.
However, freelancing is still tied to you and your time.
If you’re off exploring a battlefield in Gettysburg and not billing a client, you’re not making money.
Products, on the other hand, are super sexy.
After all, some Internet stranger can show up at your doorstep, plug in their credit card, and send you money while you’re off doing your thing.
It’s the ultimate dream.
And for many freelancers, it’s their end goal.
Is freelancing a means to an end for you? Do you want to supplement, or even fully replace, your income through the diversification that selling digital products affords?
If so, continue reading.
My battlefield musings last week led to a few ideas that you can use to help you build products while freelancing.
Can you really build and sell products online? Really…?
Products cost money to build.
Even if it’s just you doing all the work, there’s both an opportunity cost and a real cost associated with building products.
- Opportunity Cost: The money you could be making by spending that same time doing client work.
- Real Cost: It’s not free to exist. You have rent, grocery bills, and all the other things required to keep you afloat.
I think we sort of idealize “dorm room startups” because they’re created by entrepreneurial teenagers. But while these kids lack in experience and technical knowhow, they probably don’t have meaningful income otherwise (so little to no Opportunity Cost) and their expenses are minimal or subsidized by their parents (little to no Real Cost.) They’re able to dedicate time and energy in a way most of us can’t.
But for those of us with expenses, dependents, and clients who would love us to spend on time on their business rather than ours…
How can we seriously commit to building products?
It’s too risky. What if no one ever buys?
What if it’s a bad idea? We all know that most new ventures are flops.
It’s time consuming. I don’t want to spend all my nights and weekends. I don’t have the energy.
The big question you’re probably asking yourself now, and have been asking yourself for a while is…
“Can I actually build and sell my own products? Can I get random Internet strangers to pay me money? Can I make a meaningful dent in, or fully replace, my income?”
I want to talk about clientstrapping, or building products while consulting.
It’s a riff on the idea of fundstrapping, which was popularized by Colin Nederkoorn in 2017 and Rob Walling earlier this year. It’s also similar to Amy Hoy’s “Be Your Own Angel” strategy for staying afloat by selling workshops and info products while you’re, say, starting up a software company.
My experience with products
In 2008, 100% of my income was consulting work.
At the time, I was a full-time freelancer, and I was just starting to think about and act on scaling up an agency.
In 2011, I launched Planscope, project management software. At the time, my agency had 11 employees and cost around $100,000 a month to run. This was my ticket out of consulting (or so I thought.)
I did the usual startup-y things with Planscope…
- I spent about half a year building the thing before launching it
- I thought I couldn’t juggle running an agency or Planscope, so I shut down the agency to focus fully on the software startup
- To my credit, I did build an email interest list and emailed it regularly while building Planscope
This software startup really never did remarkably well.
At it’s peak, it made around $5,000 a month. When I sold it in 2016, it was just under $3,000 a month.
Coming from a business where I was needing to bring in at least six-figures a month, it was… yeah, peanuts.
I had to find freelancing work again, because Planscope’s income just wasn’t enough.
But at this point, I’d already tasted freedom. And I despised my client work… every hour spent on so-and-so project was an hour I could be selling, marketing, or building Planscope.
Eventually, I released a book (called Double Your Freelancing Rate.)
And then a workshop (the now-retired Consultancy Masterclass.)
And then I did another book (the now-retired, and soon to be reborn, The Blueprint.)
And then a few more courses, conferences, and products…
And about 3-years into products, in around 2014, I was able to “retire” officially from consulting work and could survive entirely on product revenue.
Don’t do what I did!
There’s a tremendous amount of survivorship bias in my story.
The work I did for clients was totally unrelated to my product stuff. And I started out with software, which is something I’d come to greatly resent. (Only now do I feel confident enough to start a software-as-a-service business again.)
There exists a better way.
And it’s a more reliable, more repeatable, less risky way to graduate from freelancing to products.
This is something that I started to really think through when I gave a lightning talk at Business of Software last year, and has been the topic of many a conversation amongst industry friends of mine.
For the first time ever, here’s exactly what I’d do if I…
- Were a full-time freelancer right now
- Didn’t have much of an audience or following online
- Didn’t have access to capital
- Wanted to escape freelancing by selling products
Clientstrapping: Funding product development via client work
I want to talk a bit about what I’ve been working on for the last two and a half years.
You may or may not know that I helped start a software business (RightMessage) almost exactly a year ago. But, unlike my first software business (Planscope), it was a totally different experience – and in the end, significantly more successful.
With Planscope, I jumped head-first from random consulting work into software. I did quite a bit of traditional startup validation and built up decent interest, especially considering no one knew me at the time.
The problem was that I hadn’t developed an idea, or really confirmed a business model, that people would put down serious cash on.
This time around, I did things differently:
- I developed a hypothesis (personalization, done right, increases sales)
- I then found a handful of clients who would pay me $10k+ to personalize their website
- I consistently shared what I was learning and doing online, and built up a non-freelancer audience of companies that were interested in increasing conversions
- I then created a course that covered automation and personalization, and primarily sold the course to the following I had built up (rather than my Double Your Freelancing list)
- The course sold well and I iterated a bit on both the content and positioning
- Then, and only then, did I create software to implement much of what the course taught
In a nutshell, I:
…Developed a website personalization consulting offering and sold a handful of clients.
I was able to test out how to actually sell personalization to someone – which meant a laser-focused approach on the benefits of personalization, and overcoming any sales objections. I also had to figure out exactly what this service offered, and while it differed for each client, I eventually started to come up with a standardized list of things I’d do for each client.
…Then learned how to sell personalization at scale by offering a course.
It’s relatively easy to teach somebody how to do something. It’s much harder to build software or tools that do it for them. By creating a course that encapsulated all the experience I gained doing these consulting projects, I was able to sell at scale (via a proper sales page, etc.) a course that people could sign up for and buy at any time. It’s priced high enough that there’s a bit of back-and-forth involved in most sales, but I’ve been able to distill down into a sales page everything I learned selling personalization in person.
…Then created a software product that makes it easy to personalize your website.
After I’d validated that people were willing to spend a lot of money on the outcome that personalization provides through a handful of high-touch, custom consulting gigs, I then turned that experience (both in sales and implementation) into a course that taught people how to personalize, but still required them to write the code / do the work themselves. Only after I was able to talk with enough customers and ask them if they wanted turnkey software that helped put into action what I taught in the course did I decide to break ground on software – and I had a pretty good idea of what had to be built and why.
Consulting → Training → Turnkey Products
Do you see how different this trajectory was from something like Planscope, where I did the usual “ask people if they struggle with project management” thing?
If I could go back in time, I’d first sell a handful of project management coaching engagements with agencies.
This would give me inside access into how other companies manage projects, and allow me to really develop curriculum that would help other companies manage projects better.
Next, I’d turn all this coaching experience into some sort of self-study course – or even a live group training workshop or course.
I should have enough insight into how agencies manage projects and enough experience on closing agencies (1-on-1) to figure out how to sell at scale. And because the price point would be, understandably, lower than coaching, I should be able to capture a lot more customers, data, and overall revenue.
Finally, if I had enough experience on the sales and fulfillment side of helping consultants better manage their clients… then I’d break ground on software that implements my project management philosophy.
And I’d probably have enough rapport with the customers I already have to pre-sell them on what I’m building, especially if I can tie how I’ve already helped them with the software I’m creating.
The best part is throughout this whole experience you’re not starving.
You’re making good money consulting, and you’re also learning a lot about the top-tier of the market you eventually want to serve with products.
And once you create a training product that you’re able to sell at scale, you’re going to learn how to do low-touch sales. You’ll figure out how to use email marketing and sales pages to do much, if not all, of the selling for you. Oh, and you’re still making great money, especially if you’re still consulting.
Finally, if this specialized niche consulting works out and you’re getting great feedback and results from your training product, you should then know whether it makes sense to actually go and build software.
And guess what?
If you don’t want to build software, you can stop at the training stage.
It’s totally up to you.
Many of my friends – Claire Sullentrop, Jane Portman, Eric Raio (who I just met with today), Val Geissler, and plenty of others – are doing exactly this…
They’re consultants who really focused in and executed on delivering great results via consulting gigs, and are keenly aware of the businesses, needs, and stated objections of the people they’re selling to.
Then they’re packaging this knowhow and experience into training products.
And a few of us crazy ones are even building software 😀
What I’d ask you to think about is this:
- Is consulting just a means to an end for you?
- If so, what’s this end? Forget the medium (like software) – why is this “end” so important for you?
- What great idea do you have?
- How could you start selling that idea THIS WEEK to clients? Without needing to do any upfront R&D work? Without actually having a product?
The best products emerge from existing deal flow.
After you’ve aced how to sell and market-at-scale a specific outcome, turning that outcome into something packaged and then selling that is like the ultimate business cheat code.