Ask HN: How much?
I have been freelancing for almost a decade, and I still never know what to say when a prospective client asks me this question.
Given that I have always worked alone, and given that I have never talked to anyone about this topic openly, my response has always been based on personal intuition. Now I wonder if I am underselling myself.
I am not sure if this is a taboo topic among hackers, but my impression is that such a thing does not really exist. But given that I don't know any hackers who freelance personally, I have a real need for getting some more datapoints. If I don't know what others are billing, and I therefore bill significantly less out of my own ignorance and misestimation of effort, I reduce the average price at which others are able to charge. The compound effect of this is tha we are all running like hamsters on wheels for very little money.
Between 16 and 21, I made 5 to 10 HTML-only websites for between $2,000 and $5,000. I also made 3 to 5 flash-based intros/websites for between $5,000 and $20,000.
At 21, I made a .NET-based windows desktop app for $50,000.
At 24, I wrote a RoR web-based app for $100,000.
These were all freelance projects built by me from scratch while doing HS and Uni.
Does anyone else feel like sharing what they billed for contract projects (not subcontracting gigs, client-direct only -- before any type of broker takes their cut)? It doesn't have to be something you did personally. Maybe you know what the company you worked for billed for developing a specific type of app. The results will only be interesting if we get numerous data points, and the best way to motivate more responses is to respond yourself.
90 comments
[ 1.7 ms ] story [ 166 ms ] threadiPhone rates seem to top out at around $200/hr, and iPhone devs "feel" like the hardest consultants to hire right now, so there's your range.
Note that these rates bear no resemblence at all to what a big firm would get. There are all sorts of other risks big firms mitigate that you can't. [%]
[%] (to wit: the risk of negotiating with your brain fully engaged)
You say iPhone devs top out at 200/hr. What do pen testers, (not necessarily at the Matasano level) top out at?
http://swz.salary.com/salarywizard/layouthtmls/swzl_compresu...
The average full-time web developer salary is 70k. I'm not saying I don't want to make $150k+, but I just can't find any way to substantiate the claim that I'm worth that much.
Just because you have 70,000 listed on your annual pay summary - does not in any way mean that's how much your company spends to keep you employed. When you are a freelancer - you take on a lot of those costs yourself.
Freelancers make more because they accept risk. Customers pay extra to mitigate scheduling risk, recruiting risk, and project risk.
(Yes, you're not viable if you can't at least pay freelancer overhead and still have a living wage, but that has nothing to do with what your bill rate is.)
Everyone should listen to tptacek, he is absolutely right. It is the value you can deliver, not what your actual cost is. A good web site can be literally worth millions. Deliver the final product, end to end, and you can charge a good proportion of that. 70k is "sitting down money" and most good web devs should not accept anything like that.
100k/year gross working only 20 hours a week is pretty badass if you ask me. The average (full-time) web developer salary according to salary.com is 70k/year.
Didn't you say you used RoR? You're okay with using other folks high-level code, but you think interacting with them will pull you towards the middle of the bell curve. Interesting.
This will almost surely be damaging to your career and education. If this means that you are too easily influenced or cannot identify a good influence, then I would focus on improving that in yourself.
Surrounding yourself with intelligent people in a field such as this is incredibly important. You are missing out otherwise.
it also means that the employer bears more of the risk if the work is harder than originally imagined.
(Now, I also agree with your points about why charging a flat rate is better; I'm just pointing out that there are also reasons why charging an hourly rate is better.)
Now GBP 550/day at 28 as a Linux architect and infrastructure software developer.
Addition: did the math at www.oanda.com (currency conversion). GBP is LESS than what I thought: 1.63842 USD.
So, that's 900 bucks a day, resulting in $ 110-120 USD/ hour.
Someone should take you up on $120 per hour being low!
I got paid $500 to make http://www.solafcars.com (works in multiple languages, includes an admin panel, everything on the site is editable). I would assume your RoR app was much bigger, but let us know how it compares.
I know I got underpaid though.
Joke aside, I suggest using Django in such low budget projects if the admin is a selling point. Will save you some time at least (In Django a very slick admin is automatically there for you). Best of the luck.
You are delivering a tool which sells new automobiles. A single sale is worth thousands of dollars to the dealership. If they are achieving ROI on the first sale they make as a result of your website, and you're expecting that to eventually be in the few sales a day range, you are DRASTICALLY underpricing relative to the value they perceive the website as delivering.
I second the opinion that your pricing is off by one or two orders of magnitude.
How do you actually achieve market prices?
I'm aware that there are massive differences in how much you can charge based on location, but I still feel I'm hitting more resistance to my asking prices than I should be. As far as I can tell, it's not a quality issue. I've had repeat business from almost all my past customers and none of the others were unhappy as far as I can tell, and I've had zero downtime for over 6 months now after starting 15 months ago.
Yet, if I give a straight hourly figure, 90% of the time I'm either told it's too much or I never hear back at all. I do a little better when quoting a fixed price based on the same hourly rate (plus buffers, etc), but many times the work is too ill-defined to come up with a definite offer, so it comes down to giving an hourly rate, with the usual result.
I've had the most success and repeat business with extremely time-sensitive projects, or projects that have gone off the rails and need turning around. I charge about 50% more if I'm basically being asked to work day and night. Once the work is done and done well (and it always is), I can generally get future projects at the standard rate with no major trouble.
I've reluctantly tried the loss-leader strategy of charging less on the first project, and as expected it's not terribly effective.
So as far as I can tell, the issue isn't so much the price as proving I'm worth it. How do you guys handle referrals, references, etc.?
A lot of my work involves NDAs (as it's often subcontracted), which makes referring to existing work and customers extremely difficult. I have a few customers who are brilliant and who I can use as references, but as far as I know, nobody has ever followed them up. Other than literally becoming known by everyone in the area, what other options do I have? Am I expecting a higher conversion rate than I should be? How do I go about finding more well-paying customers?
Maybe I'm tending to the wrong niches, too. My background is mainly in high performance computing, game tech and web apps.
- I've had zero HPC freelance work, and no leads either. No clue where to find them.
- I've had a sizeable amount of game tech programming, but getting reasonable money from game devs seems to be like squeezing blood from a stone.
- The web app business can yield better results, but there's a sea of awful programmers (who seem to exclusively know PHP for whatever reason) out there who call themselves web developers. Their hourly rates are dirt cheap, but their efficiency is lower still. I still can't reliably get this through to potential customers.
- The easiest money is in business-y/enterprise-y development. Except the only way I seem to be able to do this is via subcontracting, which is suboptimal because it's the middle man getting the reputation.
I'm not sure what other areas are more lucrative. Embedded stuff seems like a good fit to my skill set (game console development isn't far off) but I have no clue how to even find potential customers. I'm not sure how or where best to sell myself to enterprise-y businesses.
Intermediate tactics:
* No matter how your SOW/MSA is structured, don't quote prices in terms of $/hour.
* When you get rate pushback, follow up with a bid for a smaller or more constrained project. Slip scope. Never slip your rate. You'll never get it back.
* Include a support retainer or annual/quarterly maintenance price, instead of giving that away for free.
Short answer: by turning down projects that are below your threshold
I'm slowly getting to the stage where I can afford this, but I've only built up about 6 months of runway, and it seems nobody starts projects in winter, which meant I came this >< close to running out of cash in February. I'm trying to avoid a repeat performance. Is it adviseable to turn down below-threshold projects purely for reputation's sake?
No matter how your SOW/MSA is structured, don't quote prices in terms of $/hour.
Easier said than done. I keep doing this dance where I'm avoiding giving an hourly figure, but end up going nowhere. Do you have a more specific suggestion for how to go about doing this? Also, what does 'MSA' stand for in this context? Too many meanings for google to be useful.
When you get rate pushback, follow up with a bid for a smaller or more constrained project. Slip scope.
Thanks, that's useful. Thinking back, that's happened by accident a few times, but I'll consciously encourage this in future. Some customers seem to fear this though: it seems they're afraid I'll build something only I can maintain and then charge them crazy money later. Maybe this happens. I don't know.
Never slip your rate. You'll never get it back.
Yep. I expected that, had to do it once or twice anyway. No fun at all.
Include a support retainer or annual/quarterly maintenance price, instead of giving that away for free.
So far, I've just billed individually for any but the most trivial maintenance. (e.g. 15-minute fixes to bugs that were blatantly my fault) How do I avoid scope creep on flat fees without it seeming like a raw deal to the customer?
If your BATNA is "lose house, live in box", the bill rate discussion is academic. Steadily raise your rate with new clients. Many consultants will advise you to build a steady pipeline and then raise your rates until you're turning away enough work to be 50+(Nx10)% utilized.
You can quote prices in fixed project dollar amounts (or by the milestone), and then cap your hours in an SOW. If you're working with procurements departments, it doesn't matter, since they're doing the math automatically. But don't offer up a $/hour amount.
I have less development consulting experience than many of the other commenters here do, but what I'd probaby do with regards to bugfix support is:
* Have a formal acceptance process, at the end of which the customer is responsible for signing off on the deliverable. Most large projects I've worked on are QA'd by the customer as well as the vendor.
* Have an escalation ladder for bugs, from cosmetic to data-loss, and have SLA time frames for free fixes on anything other than "cosmetic".
* Offer an up-front retainer contract for rapid (=better than SLA) bugfixes, changes, or feature requests, pointing out that if the customer does not opt for the retainer, feature additions and subsequent revisions will be full-on new projects subject to whatever your current rate and scheduling terms are.
Something I've learned in the past 4 years: scheduling risk is something many customers will pay to mitigate.
You get a good model that helps to answer that question, and you've got a sellable market product.
Here are some of my stats - most projects I have worked on cost around 10-20k, average around 75-100 an hour, and take approximately 3 months of part time effort. I've done maybe 15 to 20 projects of this length/cost. I like projects of about this size because: I am not overwhelmed, it allows for nice quarterly vacations ~ a week each, the requirements aren't overly complicated, I have free time during the day, and the projects don't drag on forever. I freelance in Austin, my wife covers me on her insurance, I'm in my late 20's, and have done this for 3 years.
I have bid on a few 100k-size, year long projects, but have not been selected for any of them so far. So it goes.
That would make it easier to compare.
Not that I think that was the intention.
Now that I'm unemployed, I really think I need to reevaluate what my work is worth and start asking for a decent rate when projects come my way. The comments in this thread are definitely telling me I'm selling myself short - both in freelance projects and in what I fought through to earn what I earned at my last job.
Enjoying this thread. :)
If you are serious about web apps, then scaling the back end comes into play, which means getting into distributed systems. Networking, security and SysAdmin become relevant as well.
I think it's fair to charge up to $100K with a college education and/or work experience in the field. Other professions do so as well.
Go pick on other professions: i.e. banker bonuses, real estate commissions, union rates, lawyer rates etc.
Although, I admit... this example is really just a CRUD app, with no advanced server back end.
http://www.cartalk.com/content/columns/Archive/1999/October/...
I've rarely done software development contracting, but I spent several years as an IT contractor (with a lot of scripting, and simple web-based UI work to make it possible for non-technical people to carry on when I've gone). I started at $95/hour, and by the end was quoting $150/hour with a four hour minimum for off-site work, and eight hour minimum plus expenses for on-site work (with a $1000/day discount rate for multiple days).
Most of my development work over the years has been product-focused, wherein no one client paid for the whole thing. I would build as generally as possible, retain ownership, and sell the result to many customers. I wasn't very good at this for the first five years or so, however, and ended up doing a lot of development for pennies on the dollar. I would talk to a potential customer, they'd say, "We wish your products could do X and Y." and I'd think, "Yeah, I bet a lot of people would like that", and would offer to provide it for some ridiculously low price ($199, or whatever) as a plugin for my existing product line...spend two or three weeks working on it (and sometimes money for icons, design, other developers, etc.) and then never sell another copy of that plugin. I suggest not doing that.
Here are my rates. Btw I see no reason to post this anonymously. It's ok to charge money =)
- HTML Website $1500+ (without design)
- CMS $2200 - $12000 (without design)
Normally I'm using fixed prices, but in case someone specifically asks for my hourly rate I quote $70/h. Note: I ran this business part-time while doing my bachelor. Since I'm now a B.Sc (since last week) I think I might increase the rates. Guess that's appropriate, right?