I’m Not A Bank

Continuing my series of posts on business topics, one of the things you find as a solo freelancer is that everyone has a story.  Everyone.  Sometimes stories are straight from the heart and other times they are complete facades.  Reality is most often somewhere in the middle.  Part of the challenge in any initial set of discussions is discerning what is fact and what is spin.  The goal is to both properly sell your services and mitigate risk.

I’m a developer and mathematician so the first thing I look for in a conversation is whether or not the prospect talks to me like a mathematician or developer.  It’s always good for a people to be enthusiastic and optimistic about their business, but I’ve found code words like ‘this is going to be big’ or ‘this will revolutionize’ or similar phrases to be warning signs.  Charlie Van Loan at Cornell once told me at a supercomputing conference that “there’s really nothing new under the sun.”  I’ve come to understand the wisdom of those words over the years.  There are so few truly ‘big’ and ‘revolutionary’ ideas that on the basis of probability alone, the likelihood of the prospect’s claim is small at best.

And, what difference does it make to a developer?  Big does not describe the programming or math problem to be solved.  If my rate is $X per hour, then it’s still $X per hour whether the prospect’s idea is ‘big’ or ‘small’ or somewhere in between.  Big may sound like there is lots of money to be spent, but in reality ‘big’ is likely a setup to entice you into compromise now in exchange for possible future gains.

Trust me when I tell you emphatically that if you compromise today, you will compromise tomorrow and forever more.  There are no big gains in the future, except for the client that consistently takes advantage of your good will.  That sounds crass, but it comes from personal experience and the experiences of hundreds of other freelancers via private communication.

Big or revolutionary is not a story told to a developer.  It’s a story told to a bank, VC, or Angel as part of a request for funding.  I’m not a bank.  I’m not a VC.  I’m not an Angel.  I’m not a savior of any organization from its past mistakes or experiences arising from bad luck.  Don’t  tell me that the development budget is exhausted because of some unexpected complications or that the pitfalls of outsourcing have only just been understood or that a partner just withdrew from the organization.  That’s what you tell a financial organization or investor as part of a solicitation for a cash infusion.  Don’t make your very first question to me, “what is your rate?”  Why should you care if you have yet to determine if I’m the best person for the job?  Don’t tell me that you have such a hard time collecting payments from your clients.  That’s just fodder for a later excuse that my invoice will be paid after you receive payment from your clients, which is nothing more than a form of implicit financing via floating payables.  Financing is provided by banks, VC’s, Angels and other financial sources.

I’m not a bank.  I’m a developer.

If someone understands that you are an artist, copywriter, developer, or other service provider and they talk to you like a bank, beware.  That conversation is simply designed to provide an initial cover that is later used as an excuse to dilute the value of your time through free or heavily discounted services, or by implicit financing via arbitrary float of their payables.

Now, having said that, I do often help local business that have experienced some bad luck, but I do it with the attitude that it’s one step away from pro bono work.  Like the admonition to not gamble with money in Vegas you can’t afford to lose, I don’t help anyone with time I’m not willing to write off.

So, in conclusion, pay close attention to how people address you.  Do they talk to you like a service provider or a bank?  If it’s the former, then keep talking.  If it’s the latter, then be careful.  I don’t know about you, but I’m not a bank.

Good luck with your business!

Losers Breed Losses

I’m going to switch gears for a while.  Don’t worry, I’m still working on open-source stuff and you’ll see some new posts shortly.  I’ve received several inquiries about the general process of doing business as a solo freelancer.  I can’t claim to have a lock on the perfect strategy for success, but I’ve been doing this since 1997 and will be happy to share my experience.  It also provides an opportunity for others to share their expertise.

So, in that spirit, here is my first tip.  I’m eternally grateful for a past opportunity to work with Paul Jones, considered by many to be one of the greatest commodity traders of all time.  Despite the numerous trading monitors, charts, and advice generated by his support team, Paul’s greatest asset is a small handwritten piece of paper in his office.  The hand scratch reads, “Losers breed losses.”

The point is that losing positions tend to not turn into winning positions.  Losers don’t breed winners.  They tend to breed more losses.  Paul approaches a trading day with the attitude that every single open position in his portfolio is a loser.  It must *prove* itself to be a winner.  We tend to take the opposite attitude with our business positions.  We presume that decisions we make are destined to be winners. We think that bad times will turn around and a losing posture will turn to a winning one.  Sometimes, it happens, but at a substantial opportunity cost.

My business began as a 3D animator and plug-in developer.   I had character design and animation experience not matched by other programmers and C++/math skills not possessed by other animators.  It was a really nice niche and I had a lot of money and time invested in that niche.  Not just money, but emotional currency as well.

Yet, every morning, I told myself it was a losing position.  It had to consistently prove itself to be worthy of continuance.  Early after the new millennium, several factors came to the forefront that proved to be the writing on the wall for my so-called niche.  The business strategy failed to prove itself a winner, so 2003 was the year I gave up 3D and re-branded myself as a full-time programmer.

Interestingly, the niche that proved to be successful for the last nine years was something I never would have predicted coming from a C/C++/scientific programming background.

Something called Flash.

Nine years is a nice ride and I’ll never be successful attempting to predict the next nine years (nor will you or any of the silly technology pundits).  I’ve never been a <insert_the_fab_language_of_the_day> developer and never will.  Every day, I wake up with the presumption that Flex/Actionscript is a losing strategy.  It must consistently prove itself to be a winner.

Because, losers don’t breed winners.  Losers breed losses.  Try considering your business decisions in the same light and best of luck to you!

Gates’ New Venture?

So, how many people thought Bill Gates would really ‘retire’? bgC3 is described as a ‘think tank’ and could simply be a way for Mr. Gates to stay involved in the development of technology.  Think tanks do have a way of spinning off new companies of which Gates could simply be an investor or the whole operation could be a disguise fora new venture.  If so, is there a first right of refusal for MSFT on any new technology in exchange for funding? That’s about all we have at this point; questions and speculation.  Here are a couple announcements if you’re interested,

Tech Flash

Crunch Gear

In the spirit of the season, perhaps we should have a poll 🙂