Ask HN: How do I get over my 100k wall? | Hacker News Reader

Ask HN: How do I get over my 100k wall?

17 pointsOutThisLife17 comments

First post, let me know if I'm doing something wrong.

I work as a "freelancer" / contractor for design agencies in the US doing web development. I've been doing it for close to 5 years, and each year until the last 2 have been growing:

1st year was 24k

2nd was 48k

3rd was 65k

4th was 98k

5th (this year) is 100k

I feel like I'm running out of steam though. I feel like I can't raise my rates, and my client base is fantastic all around. Great people, quick turnarounds, etc..

But I don't want to stop at 100k. I just don't know where to go from here. Has anyone else gone through this and overcome it?

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Assuming you want to stay a solo contractor, Alan Weiss' "Million Dollar Consulting" is a great book to read on this subject. It's written for soft-skill consulting (management, HR, etc) but is highly applicable for developers and technical consultants too.

His main angle is to shift towards "value based pricing" and becoming a true partner to your clients, focusing on producing business value (rather than code). This mode of thinking was a huge shift for me in how I thought about my work, choosing clients, and helped me get over that wall.

If you charged twice as much, and half your clients quit, you would make just as much and work half as much.

If I may misquote patio11: "Double your price!" :)

You can get some ideas from the real patio11 in:

http://www.kalzumeus.com/2012/10/10/kalzumeus-podcast-3-grow...

https://training.kalzumeus.com/newsletters/archive/consultin...

Thanks for the links!

This is the definitive guide:

http://doubleyourfreelancing.com/rate/

I like this gem I saw on StackExchange: "In consulting deals always ask for at least twice as much $/hour as you think is ridiculous!" (http://programmers.stackexchange.com/questions/162002/#comme...)

To chime in on what others have already said here as well, despite your own personal feelings on the matter it appears you most certainly can and should be increasing your rates.

One of the main obstacles I think you are likely to face however is that you are working through a middleman here where you are bound by the rates that they are in turn charging their clients.

With that in mind my advice would be to learn some basic sales skills and start working with these clients directly. That will be the single quickest way to increase your rates I would immagine.

Additionally, have you thought about branching out into other things than purely just straight dev work for clients? Is there anything stopping you from going down the path of say selling templates / code on places such as Themeforest or Codecanyon? That can turn into a nice source of recurring revenue for you potentially with minimal ongoing time investment.

The other obvious avenue for someone such as yourself is going through the training path. Putting together a course on any number of topics is potentially extremely lucrative as a number of others here on HN can already tell you.

Just wanted to say thinks, this hits it perfectly:

>One of the main obstacles I think you are likely to face however is that you are working through a middleman here

> "I feel like I can't raise my rates"

Why not? Almost by definition, if you have a fully booked schedule at your current rate, you can charge more. That's simple supply/demand labor economics.

Keep charging your current clients your current rate. But for all new clients, double your rate. As new clients start to pay you this premium, fire your worst clients and replace them with the new ones. Rinse and repeat for each new client, until you're about to drop your most loyal ones. Then you can kindly inform them that they either need to pay you more, or find another contractor, because you have clients paying 2x their rate.

If you've got a full schedule and client base already, I don't see why you wouldn't advertise a 2x rate to new clients. It's a no-loss scenario.

It's all about the residual income my friend (in addition to the great advice you've already received about upping your prices, although I get that saying it versus doing it are two different things).

When we create a website and/or webapp for a client we always charge 10% of the total cost of the build per annum for the hosting (if required), support and maintenance of that site. This means that each time we complete a project, we're topping up our residual income ad infinitum. This baseline of income is essential to my sanity, as it means we're not 100% reliant on project work to make money.

Happy to share more info, oh and props for growing your contracting gig to 100k - that's no small feat so don't be too hard on yourself.

Have you considered pursuing larger-scale government / corporate / academic contracts?

If you can stomach a bit of bureaucracy and long wait-times, competing for those kinds of contracts might be worth your time. Half the work is finding where the RFP's (requests for proposals) are being listed. Once you find some good sources, you might find that there is little domestic competition for many of the RFPs, and that you can get well-paying contracts that require relatively little work on your end.

Just a thought, hope it's helpful.

Rather than increasing your income you could look at lowering your costs. I am not sure how viable this is for you, but living in a lower cost location will have the same effect on your overall financial well-being as raising your income.

The ceiling you have run into in likely to be the result of the niche you are in. My guess is you are at the top of your niche - the way to raise your income is to look at moving into a higher paying niche.

You can't. Your skill set is ultimately a commodity, the price of which is governed by the market.

To go further you'll need to learn a new skill that is in shorter supply and/or greater demand.

Or start selling a product not tied to your hourly labor input.

Or recruit a network of subcontractors that you can farm work out to, earn money from brokering their labor, so you can do more projects with less personal time invested in each.

First, let me say that you've done great! Not giving up after your first and second year, seeing it through till this moment. Congrats dude :)

Thanks! It was tough but well worth it. Had (still have) a wife and a newborn to support, so you can imagine I was working night and day for a long time to get our dreams realized.

Charge more, get more customers, set up retainers.

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