Pricing Yourself as a Contractor 101

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I’ve been self-employed for most of my career. Sometimes I talk to other people who are interested in leaving a full-time job to do some kind of contracting or service business. By far, the most common newbie mistake that we all seem to make is in pricing ourselves.

Take this useful blog post that breaks down employee income vs freelancer income in the US. It estimates that you need $140k revenue as a freelancer in the US to have the equivalent of $100k employee compensation. I remember finding calculations like that really useful when I first started a business. However, some people will look at the result and think, “Gee, I have to make 1.4x as much if I’m self employed. Can I really do that?”

No, no, no. That thinking is backwards.

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Leaving Google: Five Years On

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About five years ago now, I handed in my Google employee badge and walked out of the Sydney Google office to start a new life of self-employment. I figured I should write up this story because I got a lot out of reading Michael Lynch’s. As you can see, it’s still taken me a couple of years to get around to writing this post, but I finally told myself that if I don’t write it for the fifth anniversary, I never will.

This post is kind of long, but I hope it has something useful for new developers who are interested in working at a big tech company, or for big company employees who are wondering what it’s like to quit. I’ll talk about my story of getting into, working at and quitting Google, and what I’ve done since. Feel free to ask if you want more detail about something, though I already have a lot of blog posts to write, so I can’t promise anything in-depth straight away.

Also, at the risk of labouring the obvious: I haven’t worked at Google for five years, so don’t take this story as a literal description of Google today or what all Google employees experience. However, I think a lot of it’s still relevant to tech careers in general.

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Some Presentation Slides

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Here are the slide decks to a couple of talks I’ve given recently.

Being Self-Employed in Australia (at JAIT)

Because this talk is based on my own experiences, it’s particularly relevant to service businesses in Australia. But if you’re interested in being your own boss, anywhere or anyhow, you could find it useful. As I said in the talk, there’s a lot of stuff that feels obvious to me now, but I ended up learning the hard way.

Introduction to Infrastructure as Code (at RORO Sydney)

Here’s a common story: Devs write an app, and do all the right things like using source control and writing automated test suites. Then it comes to deploy the code, and they have to figure out all these things like DNS and server infrastructure. They hack something together using web UIs, but six months later no one can remember the deployment process any more.

This presentation was a really quick introduction to the tools you can use to get more app dependencies into source control.

Busywork

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My first small business wasn’t actually in the software industry. Back when I was a student, I did contract office jobs in the summer holidays to pay for things while I was studying. I got a feeling that I’d be happier self-employed than someone else’s employee, so after graduation I experimented with registering an Australian Business Number (ABN) and using it to do maths and sciences tuition. I went back to working for other companies eventually, but I learned a lot from the experience, and that know-how was extremely valuable later when I quit my full-time job to start my own little consulting business.

I might write more about that experience some other time, but for now I want to write about what’s been hardest for me to get used to: when you’re self-employed, no one cares how much work you do.

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