

Ask YC: Hiring a Freelancer with High Rates - iamdave

I'm about to hire a guy to add to the team who currently lives in the world of high-end, expensive freelancing.  Salary isn't very flexible since we're working on somewhat of a budget, and remaining conservative with our funds.<p>Currently his hourly rates are above what we're capable of meeting, but he remained optimistic about negotiations.<p>Have any of you gone through a circumstance like this, and if so what were your experiences in the long run?
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SwellJoe
If he's fantastic and believes in what you're doing, what about bringing
equity into the equation?

I ordinarily say, "Contractors don't get equity. End of discussion." But it
sounds like money is tight, and you have deadlines to meet and/or goals to
achieve that this person can help you achieve--that's what equity is for: The
things that you can't get any other way. If you can't afford him, then you
can't get it in the normal manner.

The other option: Trade equity to an investor for money--more than it takes to
bring this person on board. It's still giving up equity, but it'll probably
buy you more in the long run.

Or, keep negotiating. Rates are negotiable until one party gives a plain ol'
"No". If he isn't having to juggle jobs to make ends meet, he may be willing
and able to work on your project in order to do something fun. When I did
contract work, I lowered my rate all the way down to 1/3 the normal rate to
work on stuff I really liked. And when I could no longer give them my full
attention at those rates, I left the job and helped them in the process of
hiring a replacement.

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paulsilver
Agreeing with one of the options above - one of my friends who works with a
lot of startups will take a lower hourly rate in exchange for equity,
depending on the startup. I think the deal is he gets 1% of equity for X
amount of hours worked, with an hourly rate a chunk lower than he normally
works at. He seems happy with the deal and the client's happy with his work.

As a freelancer, I've been asked to work just for equity on various projects.
Normally this is by people who have a poor business idea and often no real
clue about how to implement their side (i.e. the business and marketing) side
of the idea. So if you ask a freelancer about working for equity, even if it's
a split deal with some money, please understand that you're going to need to
sell them the idea just as you would any other investor. iamdave it sounds
like you're not in this exact situation as you all ready know the guy.

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noodle
as a freelancer on the side, myself, i'd say that you should consider asking
him if he would be willing to scale back his hourly rate the more hours he
works on your project or the more hours you can guarantee him contractually.

i do this, as if i have a longer-term, solid project to work on, i know i'll
have that committed income stream, so i can afford to charge less since i know
i won't be having a dry spell.

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witten
Out of curiosity, what's the number of hours at which this discount kicks in?

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noodle
it really depends on the situation and the individual contractor.

in general, though, if you can offer at least 20 hours/wk for a period of more
than just one week, try making a deal. the more hours you can offer, the
better deal can be negotiated.

also, especially in situations like this, be nice/good to them. if you're easy
to work for, that'll be a good influence in your favor.

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bkbleikamp
I am on the other end (a freelancer who often quotes clients more than they
were expecting) and I would say you get what you pay for.

Higher rates probably get you better work, but they also include better
customer service, someone who is responsible, meets deadlines, etc. If the
freelancer can't guarantee those things, then ask why he is charging so much
more than his competition.

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iamdave
I would say you get what you pay for.

QFT. I have seen the quality of his services, we've talked about our own
personal ethics and approaches to development on the kinds of things my
company works for, and he's the guy I want on staff.

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gexla
You might consider just hiring someone as a w-2 or otherwise someone who has
never freelanced (or is not currently a freelancer.) Even if you could not
hire this person long term at least the person would be able to gain some
experience and cash.

The problem with freelancers is that they have lots of overhead. They may not
have to pay a lot for equipment or a building but they have limited hours and
many of those hours are spent doing non billable stuff. The overhead is in the
lost time keeping the business going.

A freelancer with a long term gig could lower rates a bit but many of those
overhead items still remain. Even with a long term contract a freelancer still
has to do marketing, keep sending out invoices, "maintain" the clients and
many other things that a non freelancer doesn't have to worry about.

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luciodribeiro
bjclark right on spot

