Florian Korte shares an older but always relevant post on the reality of becoming a freelance consultant.
You want independence, great compensation & growth in your job? Easy, just become a freelance consultant! Well – not quite… ❌
The reality is a bit more complex and there are several trade-offs to consider. After leaving BCG at the end of 2021, I decided to dive into the world of freelance consulting. After a year in the business, I want to share my personal experience thus far:
Independence – a costly wish?
To me, this meant more control over which projects I tackle, how I approach them and at what times. Experiencing the feasibility of these aspects has been one of the best parts of freelancing in the past year – especially when being hired directly by a client.
At the same time, this meant limited occasions to co-create with a team, no immediate mentor on the job to guide you and being on your own through the ups and downs of project acquisition. In my view, this is an important trade-off to consider.
Compensation – a promising path?
When looking at some of the daily rates being paid in freelance consulting, it appears quite tempting at first sight. And yes, it can provide a sustainable and good living without having to take on any side jobs.
However, there are some things to keep in mind. First, when accounting for taxes, insurance & savings it leaves me with ~15% of my daily rate. Second, project payments can come with a delay (~1-2 months) – especially when being matched via platforms (which I still highly recommend!). One just must be aware of this in the beginning to avoid cash-flow issues. Luckily, there are public founder grants like “Gründungszuschuss” which may support you also as a consultant over the first 6 months.
Growth – an uphill climb on all fronts?
On a personal level, this year has taught me several things – also about myself. As a freelancer, you deal with a lot of uncertainty, and you realize that you are in charge for everything which requires ownership and drive. While it made me more resilient, it can also be tough and exhausting at times.
On a professional level, the biggest transition was to grow into a project lead role in terms of negotiating, structuring and running the project. It requires another level of client communication and management in comparison to a consultant role.
Outlook
Overall, this past year has been equally rewarding as challenging with an open end up to this point. Looking forward, I am curious to see how the freelance consulting market develops.
There is an uncertain economic outlook potentially impacting freelance demand, while more freelancers enter the market at the same time. Furthermore, I see mostly individuals being hired. It would be interesting to see whether there is a growing market for freelance teams with both sides profiting from the setup.
What are your experiences with the freelance market? I am happy to share more insights and support you when considering a transition to freelance consulting 😊