Self-Employment and Business Models
One of the problems with self-employment is that it sounds ethically dubious. I would have to tell someone else my services can improve the success of their business. But I don't really know any such thing. To make a living, I would have to say it, on no grounds whatsoever.
To illustrate... Every time I have been between employers, I've done jobs as a freelance graphic artist. And yet I was still so radically underemployed as to be essentially unemployed. I get almost no work because I don't know how to drum up business for myself. That's something I still dislike doing. I can't tell them that my services will help them in some way. I don't know if it will. I do art because I want to do art, not because it will help somebody. I just provide it, and let them decide whether it's worth it. This is not selling. (This is also why I undercharge. I don't want to think about its value to them.)
Business coaches tell me they can train me to succeed in my self-employment. I don't know if I can believe that. They have to tell me that to make a living, whether it's true or not. Then there are networking groups. I've been to these. It's salespeople selling to other salespeople. The whole culture of self-employment looks shady from outside, and I do not trust that road to lead to much of anything but mutual predation.
The basic problem is figuring out a business model. This always involves modeling the desires and plans of other people (both businesses and customers), and these are people who I do not yet have the experience to know or understand. And the only way I see to break in to that understanding is by lying and claiming to already have it, and screwing a whole lot of people in the process of learning it.
The great thing about a nine-to-five salaried job is letting other people worry about whether what they have hired you to do is actually worth money to someone. Whatever I do, I prefer it to be something I do because I like the task itself. In order to make a living at it, it has to help somebody else's values and goals, but that isn't the point. It's ironic that as a "self"-employed person I spend all my time thinking about how to give other people what they want, and as a non "self"-employed person I spent none! In which one am I truly working for me?
Secondarily, what I do should have meaningfulness to achieve my values in the world, in a way I understand. The cause of Free and Open Source Software does that, for instance. But here is a painful realization I had-- the improved success of somebody else's business involves cause-and-effect relationships that I can never really be sure about. Oh yes, I've memorized the reasons that Open Source Software will accomplish it, and I can present them convincingly. My presentation is really awesome. But I didn't discover those reasons through witnessing them in action. I trust other people's wisdom that it will help businesses succeed. Every strategy in business is just speculation, but business consists of convincing people to do things, so you have to fake confidence in a decision that you can never really be sure is the right decision. That's what makes me feel ethically uncomfortable.
I know that I have another motive for saying it anyway. If I am going to be honest with myself (and I'm crazy about that), I have a predisposition to trust other people's wisdom about Free and Open Source Software business models. My only real motive to love Free and Open Source Software that it doesn't involve money! It lets me stop thinking about business motives and think about humanitarian principles where I feel confident and comfortable. I know for a fact, for instance, why the average person should want to ditch DRM. The same reasons that I want to ditch DRM apply to others. Personal experience about something I care about, and although it applies to all of us, I care about it because one of "all of us" is me. So the Campaigns Manager bit with the Free Software Foundation would have been a slam-dunk job if I had only applied for it four days earlier.
Comments
atdt1991 on Jun. 13, 2007 6:07 PM
I think your perspective is skewed, if I may.
You say you have no way to prove that your assistance will absolutely and definitely improve their business, and that is to some small extent true.
However, you're ignoring comparative evidence. Initially, you may have to rely on statistics for businesses who do and do not use services like yours. Or, you will have to offer your services at a discounted rate for the exact reason that you are unproved. That is a perfectly resaonable solution.
However, as a self-employed person it very much behooves you to ask about your performance from each client, and even ask for statistics if they are willing to offer them, that relate to your performance. At that point, dog willing, you'll have improved their business in a real and measurable way, and you can then use those statistics and that word-of-mouth to convince other people that you can do the same for them.
Is it an absolute promise? No. Are they paying for an absolute promise? Not unless it's in the contract, and it just isn't. They are paying for your services, whether they are succesful or not - your incentive to do well in a measurable way is for repeat business and verifiable results.
When I apply for jobs as a video editor, they absolutely expect to see a portfolio. They do not want to just assume that I know how to edit, they want proof. It doesn't mean that there is some ironclad proof that I will do something amazing and unique for them, but if I've done amazing and unique before, the odds are better than otherwise, and that's all they ask for.
matt-arnold on Jun. 13, 2007 6:16 PM
All of this is true so far as it goes, but why do they need any video editing at all? That is what determines your choice of whether to go into video editing, which is analogous to the choice I'm trying to make in this post. Why will a video editor, any video editor, help their business, and how do you know there is enough of that in the desires and plans of the world around you, to form your business model around that and say "my business model is to offer video editing"?
I've started asking the subset of people I know who seem to be making a living (a discouragingly small subset indeed), this question: Did you sit down and strategize a personal life-plan business model rather than trust to luck? I know a lot of people who need help with that right now, to know how you sat down and worked through that.
atdt1991 on Jun. 13, 2007 6:38 PM
Mmm, Why a client needs video editing varies as wildly as the actual subject. Am I interested in videotaping events, which may require recording for posterity and/or advertising purposes? Am I recording commercials, to put a person or company's product (their baby, after all) in the best possible light and expose it to the world? Am I recording weddings, a matter of both posterity and artistry, where one must be dedicated to someone else's vision of themselves to make them happy? Are you editing a film, maybe something entirely about art and expression, a collaborative work between you and the director?
If I am a video editor, or a videographer, I may do any of those things, or I may do all of those things. I have chosen a skill that allows me to express myself, to pursuade, to tell a story. How I do that, and what quantities of those things are used, depends entirely on the project. I may want to get into exclusively editing films, for instance, but my skills do not dictate that I must starve until I can do that.
As for "How do you know there is enough of that in the desires and plans of the world around you to form your business model around that and say "my business model is to offer video editing", the first thing you have to ask yourself is, what is your priority? Do you want to offer a business, no matter what that business is, and thus your model is whatever is most effective? Do you have a skill you would like to apply, and are searching for a business that will be most effective with taht skill? Or do you have an exact inspiration for a business that you want to "make work"?
Because that is what the library is for, that is what business students are for (believe me, many instructors are looking for real-world examples that students can use to create business plans). Download some sample business plans and take a look - you research what is going on around you, prices and time for the work you want to do, see if the numbers work or if you need to modify your business in some way to make it function better. Maybe your target demographic is off, or you may need to move your anticipated location in order to get business from people more likely to need your product/service.
This isn't as nebulous as you make it out to be - there are statistics available for everything, and one writes a business plan first to show themselves whether something is possible, and then to show the rest of the world how it will be possible. Sometimes you have to do Primary Research - IE pick up the phone and call potential clients and -ask- them how interested they would be in a service like yours.
Because every variable can not be known, we have "risk". It is your responsibility, as the person in charge of your own destiny, to assess whether accomplishing something is worth taking the risk that you will not accomplish it, and how well defined that risk is is nearly entirely defined by how much study and research you are willing to do (or willing to pay for, as the case may be).
If you jump into a business without making any effort to determine whether it will be successful compared to others and based on the product you offer, that's LUCK. Maybe you'll do great, maybe you won't. Research creates MANAGED RISK, which is, in my opinion, a different banana.
stormgren on Jun. 13, 2007 7:03 PM
Well said.
Market research goes a long way to seeing if there's any viability.
From my POV, it's not only managed risk, but there is a certain amount of luck and chance. Bad luck can be over-ridden by tons of effort, but sometimes, it's a matter of the wrong timing.
atdt1991 on Jun. 13, 2007 7:15 PM
Well, the reason there is risk at all is that there is uncertainty. If you'd like to call that luck, then certainly, they are equivalent. However, relying on luck without any study means that you don't actually have any idea what the odds are, or how to improve those odds.
Oh, and thanks :)
stormgren on Jun. 13, 2007 8:02 PM
Well, I make a distinction between luck and uncertainty. There's always uncertainty.
But sometimes, random things happen that one cannot predict or plan for really, that can change outcomes for better or worse. Those random things I lump under "luck".
This being said, I will agree. If one doesn't do their homework, one cannot expect to coast on random chance alone.
matt-arnold on Jun. 13, 2007 8:01 PM
Because that is what the library is for
Great advice. I'll go to the library and ask a librarian for books on how to research the choice of a career.
atdt1991 on Jun. 13, 2007 8:13 PM
Heck, we have a bunch of librarian friends who would be happy to help you, like Rikhei.
atdt1991 on Jun. 13, 2007 8:13 PM
Also, if you'd like, I might be able to get you in touch with my good friend Scott, who is a career counselor, and whip smart. He does not, alas, have an LJ, heh.
tlatoani on Jun. 13, 2007 6:38 PM
Well, I'm making a living. And no, I didn't sit down and strategize much, even when I had my own business.
phecda on Jun. 13, 2007 6:12 PM
This reminds me of a quotation (can't remember who said it now): "Any idiot can paint a picture, but it takes a real genius to sell it."
You need an agent/manager because it's clear you a) don't understand business, sales and marketing, and b) have no real desire to understand. No one would have heard about Salvador Dali if it hadn't been for his wife Gala relentlessly pushing his work. This is also part of the reason why galleries put such a markup on art work. Now, if I want a signed Dali print it's going to cost me upwards of $10K.
Just saying...
matt-arnold on Jun. 13, 2007 6:22 PM
I've spent a significant fraction of my life doing things I don't like to do, and business, sales, and marketing is just one of those things. So it's not like I can decline to do it. Life does not give any of us that choice. Each person's life is a business for which that person alone is responsible for the outcome. We each can either do it well, or poorly. So I'm grappling with it every day.
phecda on Jun. 13, 2007 6:38 PM
What I read is that you want to create, but you don't want to be involved with the mechanics of selling that creation, or targeting your creative process to a market. E.g., you don't want to "commercialize" your art.
In that case you need to link up with someone who can commercialize your art. Successful artists (e.g., Rodin), network with potential customers, sometimes tailoring their work through commissions for what their patrons want. Others work through agents or galleries to sell their wares.
So, as much as you dislike the commercial attachments of money and the supposed constraints this would put on your creative process, this is how artists have worked for millenia.
You produce the pretty thing. You either keep it, or you trade it for some commodity that you need.
And I apologize, you actually do understand business at some levels. I read the prospectus you put together for donors to Penguicon. There is a clear understanding of the quid pro quo process involved in sponsorship.
You just need to take the leap that occasionally prostituting your creative process is not going to destroy it.
atdt1991 on Jun. 13, 2007 7:01 PM
I kind of think of it as the equivalent to eating - it requires you do something you may not approve of in theory (killing another living thing), but that is precisely the stakes of survival, and your choices are to kill (directly or by proxy) or die. You can choose to only kill "lower order life", but that only a matter of degree.
Similarly, in order to survive, people must trade something they can do for the symbols of someone else's labor in our post-barter capitalist economy. If you can live off hunting and gardening on land someone purchased for you, fine, but otherwise our choices are limited only to what skill, and who for. I've accepted these things as granted facts and I think the important thing is to say "This is the situation. NOW what do I do with it?"
For instance, I do video editing in a company with some of my friends. We shoot independent film for many reasons, but one reason is that we each have a day job where we do things to accomplish someone else's goals, and we want to do something for ourselves. I could choose to work for a company making important documentaries, perhaps - I would be working toward a common goal that I believe in, and they would be paying me because they would have investment, and the investors would get paid presuming the movie made money in sales.
This is the system we work and live in - capital is required. Do you (in the general sense), reject that, or attempt to accomplish your own goals from within that system?
(PS sorry for the numerous long comments, I rather hope the conversation is useful. They're just my (fairly humble) opinions, even on what is 'fact' and what is not.)
atdt1991 on Jun. 13, 2007 6:47 PM
I consider putting my best foot forward a matter of both self-confidence and of honest assessment - I need to present my skills in the most attractive way possible, or I am not helping a person accurately decide how and whether I may be used for their purposes.
If I do not have confidence that I can create something worth my cost, no one else will be convinced either. If I am genuinely concerned that I am not worth my cost, I need to do something about that to make myself worthwhile.
I do not think I am at all dishonest in the interview process. Now, I don't tell an interviewer how i was late that one day, or how I got yelled at once, but I do present my experience in whatever way will most interest a person. I am competing with other people who put their best foot forward, and even some people who present themselves as more accomplished than they are.
To put it a completely different way, a job interview is a potential challenge. Getting the job is simply the part where you say, "I can do this". The rest of the job is proving it, to yourself as well as the people who hired you. If one only accepts challenges that one has proven they can accomplish by having done it before, a person never does anything at all.
rachelann1977 on Jun. 13, 2007 7:31 PM
I think I see your dilemma. Ultimately, you come from a somewhat unique perspective. You feel you were sold a bill of goods as a child, namely Christianity, and you do not want to reflect that behavior in any way shape or form. You work very hard to avoid that, and while I admire that about you, I think it can cripple you at times.
Selling your services is about belief, to some extent, to the extent that art is about belief that a thing is "pretty" or "good" or whatever, but just because a thing is subjective doesn't mean you have to lie to sell it. You honestly believe you do a good job with what you do. If a person tells you what they want, you are confident that you can produce it. If they tell you what you they think their customers will like, you will do that, You may occasionally have input into what their customers may like, if you have some familiarity with their customer base. That's all you have to say in the beginning. If you get more work, gain more experience, get more feedback, then you'll have more information to go on, and you can present yourself more fully. That's just how it goes. It's not an exact science. It's not black and white, good and evil. Just figure out what you already know how to do, figure out what you can learn, and leave the ultimate unknowns for the days when you have time to ponder.
matt-arnold on Jun. 13, 2007 7:47 PM
"If a person tells you what they want, you are confident that you can produce it."
Yeah, that has always worked out just fine. But if they don't come to me, I have to convince them that they want art, then it all breaks down. This is not a choice between me and some other graphic designer. It's a choice between professionals and free clip art. I have to convince clients that art is actually worth paying the going rate. For that I have to understand the specific business model they use, whatever that may be among the millions of business types that can use art.
This is a question of what career to go into, and where to get the information to figure that out. All jobs are businesses, whether you are a cubicle wage slave or self-employed. My life is a business, the choice of career is a business decision, and it's as simple as that.
rachelann1977 on Jun. 13, 2007 11:30 PM
"This is not a choice between me and some other graphic designer. It's a choice between professionals and free clip art."
It's not really a question of business models, the way I see it. It's a question of personality. Companies inevitably choose a personality, whether they are aware of this or not. What you are really offering them is a chance to have a little choice in the matter, if they are willing to pay for it. And it IS worth paying for IF they have a "saleable" personality to depict, if you know what I'm saying. Now, you don't need to say that. NOT saying that is really just a matter of politeness. It's the same reason why our T-shirt vendor at PCon didn't go around saying, "I can't make people laugh if your joke isn't funny."
matt-arnold on Jun. 13, 2007 8:15 PM
I think I see your dilemma. Ultimately, you come from a somewhat unique perspective. You feel you were sold a bill of goods as a child, namely Christianity, and you do not want to reflect that behavior in any way shape or form. You work very hard to avoid that, and while I admire that about you, I think it can cripple you at times.
You're probably right. Very insightful.
stormgren on Jun. 13, 2007 7:43 PM
Matt, hate to see you struggling with so much of this...
A couple of points I wanted to address:
Then there are networking groups. I've been to these. It's salespeople selling to other salespeople. The whole culture of self-employment looks shady from outside...
I'll have to strongly disagree on this. Mostly because you're painting the self employed with a very broad brush, and I'd really not like to think of myself or a majority of the people I do business with as shady. There's really no difference between owning a business and being self-employed, it's really just a matter of scale.
...and I do not trust that road to lead to lead to much of anything but mutual predation.
Well, the networking groups are terribly useful for someone who is just getting started, in terms of generating leads. It allows one to come into contact with people who might need or want your services that one might not otherwise get to meet. Nobody is forcing anyone to accept services from anyone else. If people don't want what you're providing, they won't take it, but it might open doors that otherwise wouldn't exist. It's cheap marketing.
If you're self employed, or own a small business in a more formal capacity, you *have* to be a salesperson, strategist, marketer *and* do the actual activity you set out to do.
Networking, be it through groups or through friends, family, or past business associates, is a very powerful tool. My current large contract gig was obtained because a friend of mine referred me to the client. Never, never underestimate how this will work. It's an inertial thing, sure, as you build up satisfied clients, eventually you'll start getting leads just because one of them happened to mention to an associate or a friend "Hey, you said you were looking to have a logo (or whatever) done? I know a guy who can do that." The groups help bootstrap this process.
It's ironic that as a "self"-employed person I spend all my time thinking about how to give other people what they want, and as a non "self"-employed person I spent none! In which one am I truly working for me?
The smartass answer is "both of them".
The longer answer is that if you're providing services and/or products to a customer, part of operations is, indeed, making sure that you're keeping your customers happy, and providing what they asked for. The advantage is that if you have a customer that's not worth the effort for the return on it, you can walk away when the job is done, and not take any future business with them.
Every strategy in business is just speculation, but business consists of convincing people to do things...
Yes and no. It's speculation, but it'd better be reasoned speculation. That being said, it's not so much convincing people to do things, but convincing them that thing (that they're probably predisposed to do) should be done by you.
...so you have to fake confidence in a decision that you can never really be sure is the right decision. That's what makes me feel ethically uncomfortable.
Well, frankly, it damn well shouldn't be fake. If you have no confidence in your work, or in the solution you're proposing, why in the world are you proposing it? It should be reasonable, it should be thought out, and the tradeoffs, if any, should be accounted for and noted. There is no ethical conflict if you're straightforward in what you want to do and you're not going out of your way to mislead your client.
matt-arnold on Jun. 13, 2007 8:00 PM
First of all, I did not intend to draw a distinction between the self-employed in one-person companies and any other, larger type of business-starting entrepreneur. They are both self-employed for purposes of the terminology of what I wrote.
I said looks shady and predatory. Naturally there are both fish and sharks swimming in that vast sea. I'm pointing out my lack of confidence in distinguishing them. Without distinguishing them, knowing they're both out there doesn't help me say with confidence "because I can trust my new associate, you can trust me to pay my part of the rent." "Instead of paying the rent I'm going to pay this networking group, and trust that this will bring in more money than it costs."
If you have no confidence in your work, or in the solution you're proposing, why in the world are you proposing it?"
Like said. To eat. I already told you there are no solutions I understand well enough to be confident in proposing them. You eat even though it costs the life of the one you eat. I don't like that and that's what I'm struggling with.
I guess I should have been more clear that I'm trying to change careers to something that actually works, and I don't know how to research what to get into. That's what this is all about.
atdt1991 on Jun. 13, 2007 8:21 PM
You are one of the few people I would propose this to: I would suggest going to the library (a modern one with recent books) and pulling out some books that teach a few of the things you're looking at.
I think you will find that you have a great head start in some of them, and you'll pick up not only some new knowledge, but some confidence in things you were already pretty sure were true, but didn't have proof.
Also, relating to trade associations, I think they are incredibly useful for exactly this sort of learning. Many people in large organizations are more than friendly, and are willing to help someone else learn and grow.
atdt1991 on Jun. 13, 2007 8:45 PM
"I don't like that and that's what I'm struggling with."
Here is how I think of it (since I've pretty much peppered this whole entry with my thoughts):
Money is a symbol that represents effort, time, and skill in a quantity that is constantly in flux. It represents value, and while that system is easy to corrupt or "game", it is not inherently evil. Just flawed. The fact that it varies from person to person depending on their income per year is what keeps it from making sense - if one dollar equalled one minute of any one person's time, life would be awfully different.
When a person asks me to do something for them that they cannot, they declare the value to them of that work. If it is art, they are showing me that value to them as represented by money (which, let us remember, they received for X hours of their own time/skill/work). It is not the ONLY value system that matters, and in fact may mean much less than, say, the accolades of your peers, but it is the only value system that provides us with survival.
If I were to ask someone to do something for me when they have no reason to provide me with it as a personal favor, I would expect to pay for that thing. I am expressing how much value that thing has for me. I am giving up some of my time, my effort, for their product or service.
I think that's an honorable thing, in that context. When I save money, I am banking my time and effort at something I can do, towards something I can not (farm, weave, build, etc).
I believe that I have something to contribute that is worth someone else's money. I may be at the beginning of my skill set, I may have much to learn, but my time and effort still has value, and deserves to be respected that way.
YOU are an intelligent man, capable of adapting and learning much, whose mental processes give you some unique advantages and perspectives. You're also creative and capable of expressing through art, and that makes you valuable.
Clip art is boring, basic, and never expresses exactly what you need - too much text on a flyer and you need the arm behind the guy's back instead of overhead? Too bad. You take what someone desires and bring it to life, give it form, express the wishes of the person or company requesting it.
I could spend a day looking through vast CD's of clip art, or I could hire someone to make something for me. Which is a better use of my time? (The answer, if I were a business owner, would be clear.)
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