4 Career Progressions for Freelancers

You’ve surely heard of the corporate ladder, but what are the career progressions for freelancers?

Those of us who sell creativity in some form usually freelance part-time at the start, and those who stick with it eventually think, “Hey, why shouldn’t I be one of those people who make money while they sleep?”

Here are the first 4 stages:

• Moonlighter
• Hustler
• Lifestyler
• Diversifier

Based on 100s of conversations with freelancers, I’ve distilled the motivations, challenges, mistakes, and questions at each stage, as well as the main breakthrough and financial goal for each.

‍Moonlighters

Most freelancers I know start part-time, picking up freelance projects here and there. These folks have jobs. I use “job” here loosely to mean not just a full-time position somewhere but another set of obligations (e.g., caring full-time for children or an aging parent) that consumes most of their time and attention.

A designer may have a salary at a digital agency and create album covers and t-shirts for bands at night. A high school English teacher may pick up book editing projects during the summer. A stay-at-home photographer dad may homeschool his kids and shoot 10-15 weddings a year.

Here’s an unusual one I heard recently: My friend Matt’s dad served as a senior pastor at a church, but several months a year, he’d put on his CPA hat and prepare tax returns.

The motivations here will be familiar to most of you:

• Test the waters with the whole freelancing thing.
• Make extra money on the side for fun, bills, or a big purchase.
• Perhaps have a bit more creative freedom because 9-to-5 jobs don’t always scratch that itch.

It’s worth noting that moonlighting can start by accident, and the business can grow organically at first.

You start sharing illustrations online, stuff you made to please yourself, and Aunt Barb surprises you with a direct message: “Can I pay you to create a holiday card for my recruiting firm?” Aunt Barb is loaded, and that single project pays for all the gifts you buy that year. Suddenly, you’re wide awake to the extra earning possibilities.

The challenge for Moonlighters is three-fold:

• finding projects
• finding time and energy to split between them and managing the business itself, and
• juggling the many responsibilities and priorities.

In short, you must cut up the same small loaf of minutes and pass it around to many hungry mouths.

Of course, plenty of moonlighters figure it out, and a large number are content to enjoy the side hustle but keep it on periphery.

Moonlighters don’t need many tools because you don’t have many projects or tasks to keep straight at any one time.

The most common mistakes they make have, at their root, the muted sense of urgency:

• Undercharging, because you’re not counting on the income and can literally afford to
• Inefficiency and rather sloppy process because you don’t have to run a really tight production queue when you’re not counting on the money.
• More casual attitude toward brand and business building—e.g. having a strong web presence and up-to-date portfolio and getting testimonials and referrals

The questions, fears, and insecurities vary with the person:

• What’s the next most logical step for my business?
• How does one break into freelancing?
• How much should I charge?
• Where do I go from here?
• Am I doing this right?

The main breakthrough for Moonlighters is rising confidence in their ability to win projects and deliver outcomes while managing their other responsibilities.

The main financial goal for Moonlighters is socking away cash in an emergency fund, useful for its own sake in stabilizing one’s personal finances, but also important for runway if they were ever to go full-time freelance.

Hustlers

Eventually, some Moonlighters decide to take flight into full-time. The reason is often a growing dissatisfaction with a full-time job—the pay or people or slimy supervisor. Other folks have an experience like mine: being pushed forcibly out of the 9-to-5 nest.

When I got laid off in 2009 during the Great Recession, it was either flap like a drunken buzzard or sink like a stone.

I’m glad I lost my job though because I see, in retrospect, I had an entrepreneurial bent. When you do, you’re an iron filing caught between two magnets.

The safety, security, and predictability from a regular paycheck have their appeal, but mastery, autonomy, and purpose (or MAP, a la Daniel Pink’s work in that area) pulls at you too.

One day, the MAP magnet wins the tug-of-war, and you’re all in. No one to answer to. No soul-crushing meetings or icky performance reviews. Glorious freedom!

Well, not quite. Every career path has its own set of problems. As a newly self-determined solopreneur, I didn’t have to listen to my old creative director’s remarks on the holes in my jeans again. (“It’s called style, sir. You might explore it.”) But that didn’t change the fact I only had $486 to my name.

In four short days, I went from “I really ought to save more” to “Shifurrrgghhhhk!!!” (That’s the noise you make when your rational mind overloads with panic. A universal sound that translates to any language.)

The motivations of Hustlers are etched with the acid of painful experience into my memory:

• Find more, better clients (i.e., more budget and creative license)
• Sell non-differentiated services like copywriting and design
• Pretend you have a clue what you’re doing
• Try to be “competitive” with your prices
• Don’t screw up projects cos then what
• Make enough to pay bills
• Serve clients well

Freelancing isn’t cute anymore. It’s survival.

Once the external scaffolding of a team, boss, and routine disappear, we see the challenges we’re really dealing with.

It’s easier to hit a deadline when you receive a grade in college or don’t want to get fired, but when the small, red, cartoon devil version of your boss isn’t hovering over your shoulder and telling you to get back to work, you may find yourself with even worse coworkers who live in your mind: Procrastination, Second Guessing, Overthinking, Imposter Syndrome, and the biggest turd of them all, Scarcity Mindset.

Mistakes abound like dandelions on a dung pile:

• All the mindset traps mentioned
• Shoddy contracts (or none at all)
• Weak boundaries with clients (and generally supporting their bad habits along with your own)
• Offering all the services… the human equivalent of a bodega
• Non-specialized with weak positioning or none at all. You have a pulse, I’ll take your money.
• Undercharging. No surprise there. Your self told you you couldn’t afford to lose the project.

The questions, or rather the lit-up arrows pointing to breakthrough are these, among others:

• How do I depend less on referrals? How do I get a grip on my own marketing?
• How do I make more money without simply working longer hours?
• How do I raise my prices without losing all my clients?
• How do I specialize or niche down?

The main breakthrough for Hustlers is setting smart, strategic prices that reward their skill, efficiency, and expertise, usually by pivoting from charging hourly to flat fees, and establishing a morning marketing habit that makes them less dependent on referrals—and much more likely to get the clients they most want.

The main financial goal for Hustlers is paying themselves as much or more, after tax, as they made on salary at their last full-time position and beginning to fund certain lifestyle goals.

Lifestylers

I’ve coached A BUNCH of these folks who honestly remind me of me, circa 2017.

You’ve hustled, and from the perspective of Moonlighters and Hustlers, you’ve made it. You’re full-time. You’ve replaced the after-tax income at your last 9-to-5 job and then some.

You’ve gained confidence. You can do this.

That’s not to say you’ve got everything figured out. Oh no, the cracks are showing. If anything, the challenges are bigger, not smaller—new levels, new devils—and if you’re honest, you brush the borders Burnout Land more often than you’d care to admit.

Sometimes, you feel like a hamster on a wheel: find new project, deliver project, get paid, and around it goes.

You’ve been fortunate, you know that, and you’re grateful, you really are.

But you can’t help but wonder, “Now what? Is it 10, 20, or 30 more years of this? Do I just keep raising my prices to meet supply & demand? Do I create a product? Do I just tell myself to be content?”

We can get so focused on winning the next project and trying to achieve financial stability that we become something very much like creative workaholics. A client named Amanda expressed the dilemma perfectly in this question:

“What’s the point of all the extra income if I’m too busy to enjoy it?”

When you’ve been the solopreneur who knows what it’s like to have scary months, you may keep saying yes to everything, thinking just a little more cash in the bank would finally muffle the anxiety and scarcity mindset that have driven you for years.

Admittedly, I’m talking about myself here, but can you relate?

“Just one more month’s worth of savings in the emergency fund and then I’ll take my foot off the gas and start enjoying my life a bit more.”

“Just one more debt paid off or big purchase locked down and then I’ll start breaking up with the bottom 20% of my clients and start passing up opportunities and start… well… whatever it is that normal, employed people who can clock out do when they’re enjoying themselves. Go on more vacations? Grow basil? Finally organize the garage?”

The core motivations for Lifestylers are more subtle and have emotional shading of trenchant fear, effervescent hope, and everything in between:

• Not going back to hustling and grinding it out with smaller, less lucrative projects
• Trying to find work-life harmony and not let work, even if it’s mostly satisfying, crowd out other things that are just as important
• Learn how to make the same income, or more, in less time. Better leverage, come hither…
• Finding out what’s next because you’re a multipotentialite who doesn’t want to do just one thing, but many, and may not want your current and ostensibly “successful” freelance business forever.
• Get more support and delegate effectively… That’s a thing, right?

The mistakes are intertwined with the fears and motivations:

• Playing it safe now because in a sense you’ve “made it” and don’t want to lose what you’ve built
• Sustaining your business with predictable work, to support your lifestyle, but that work can become boring and/or unchallenging
• Creating freedom for yourself as a solopreneur but never spending it; you take less time off than an employee, and when you do go on vacation, you still worry about your business. You check in on your business while you’re supposed to be “away,” don’t really honor your vacation, and don’t gain the benefits of truly unplugging
• Your mind runs in circles and you struggle to design and finish experiments for what’s next because you don’t want to inadvertently blow up the livelihood you’ve already got. You’re more tentative and less decisive now than when you were a hustler and had nothing to lose by throwing stuff at the wall to see what stuck.
• You’ve developed expertise, and because you’re good at what you do and you know it, you find it difficult to believe someone else could do it as well as you. That belief makes it difficult for you to delegate, even though NOT delegating is part of the problem, which you’re well aware of. So you’re chasing your tail and still spending way too much time on $10/hour tasks, not $100/hour or $1000/hour tasks.
• Experienced as you are, pricing can still be a struggle. You want to be compensated for all your skill, experience, and expertise, but you’re often up against less experienced but cheaper “competitors.” Some clients use price for comparison, which isn’t fair, but you don’t always have a chance to explain why you’re worth it before they make a decision.

The questions at this stage get more nuanced and existential: “What now?” “What do I really want?” “What do I want my life to look like?” “How can I make my highest and best contribution to my family, community, and world?”

You start to look for ways to diversify your income because no matter how high you take your prices, freelancers and consultants are always trading time for money.

The main breakthrough for Lifestylers is getting better leverage through strong positioning, specialization, juicy offers, value-based pricing, an always-be-marketing practice, healthy pipeline, well-defined processes, and proactive mindset upgrades.

The main financial goal for Lifestylers is making the same or more money, in less time, and seeing less fluctuation in their earning from month to month, thanks to the strategic pricing and consistent marketing just mentioned. Consistent income creates a flywheel of paying oneself with “old” revenue, saving more, becoming pickier with the clients and projects you take on, and feeling more satisfaction overall with work, earning, and life.

Diversifiers

This is the stage where I am now, and I’ve experimented with the three primary ways that freelancers become full-fledged creative entrepreneurs:

1. Consulting, with a value-based pricing model
2. Scaling up into a lean agency with a team of contractors
3. Building an audience and creating one-to-many products and services to sell to them

Of course, Diversifiers, like Lifestylers, aren’t simply interested in more money. A certain amount of money covers the necessities and some niceties too. You might say it hits a pressure release valve. According to Daniel Kahneman’s landmark Princeton study in 2010, the number was $75,000. Adjusted for inflation, the number is now closer to $100,000.

What about after that?

Diversifiers have started optimizing for more time: time to draw (used to love to do that in college!), or go on field trips with the kids, or travel without needing to check the inbox.

There’s more to life than work, and more to work than money.

Diversifiers have also started to optimize for impact and true fulfillment.

Things like “service,” “impact,” and “whatever happened to that children’s book I wanted to write” come into play.

The focus shifts from “how can I make this work?” to “what do I want my days and life to look like?” and “what kind of work would I do for free?”

It’s no surprise that many freelancers who reach this stage want to reach back and give other freelancers a hand up through teaching, training, and coaching.

The core motivations for Diversifiers are as follows:

• Creative license. Either you let me do what I’m good at, or I’ll leave and find a client who will.
• Time affluence… Life’s short, and I want to do other things beside build my clients’ empires.
• Diversified income streams. Sure would be nice to be less dependent on service income…
• Getting better leverage. The desire for better results with less effort manifests in both more tactical, short-term decisions to shore up positioning and create juicy offers and in more strategic, long-term decisions to build an audience.
• Helping peers find their way. Once your mindset starts moving from scarcity to abundance, you realize just how fulfilling it is to inspire and help the next wave of Moonlighters, Hustlers, and Lifestylers.

The core challenge for Diversifiers is effectively starting over. Diversifying income streams (and optimizing for time and better leverage, not more short-term cash) involves new business models. You go from being the seasoned freelance veteran to agency founder or product- and audience-building rookie, and all the freelance experience doesn’t necessarily translate.

What your business, or businesses, need from you changes, and this can be disorienting and discouraging: “I’m good at [your freelance work], so why aren’t I getting better results with [new iteration of the business]?”

A drop in freelance income is natural as you begin to devote more time and attention to developing the business than simply delivering projects, but Diversifiers often misread this lagging indicator: “I must be doing something wrong because I’m making less money, not more.”

Despite their well-developed skills and domain expertise, Diversifiers make all kinds of mistakes:

• Building courses and other digital products BEFORE you’ve validated the offer with real people in the target audience
• Taking your eye off the client work marketing ball as you grow your audience and product business
• Starting new projects and ventures without getting the support you need (i.e., hiring a virtual assistant)
• Trying to hire contractors or employees before you’ve clearly defined your processes and created scalable SOPs
• Overestimating how quickly you can build an audience and replace service revenue with non-service revenue (affiliate commissions, sponsorships, product sales)
• Needing to be involved with every aspect of every project (because no one knows it and can do it better than you, right?) and becoming the bottleneck that chokes the growth that wants to happen
• Struggling to differentiate between reversible and irreversible decisions, not make the former fast enough, and developing a backlog, or what I call “cholesterol,” that inhibits the flow
• Imposter syndrome. Surprise! You didn’t think it was going to go away, did you?

Adroit management of all the details got you here, but that very same control which served you so well becomes the obstacle to growth. Unless you can trust others and create systems and processes that maintain quality and client experience—without your constant involvement—you get in the way of your own potential.

The questions at this stage have some of the same existential timbre as the questions Lifestylers ask (e.g., “What do I want next?” “What is my zone of genius?”), but they can get much more tactical too: “What’s most important right now?” “What do I need to start saying not to?” “Who can do this for me?”

You have to let go before you can reach higher. Nobody said it was easy. (Thanks, Coldplay.)

You have to decide what you want more: the comfort of control or the thrill of adventure.

The main breakthrough for Diversifiers is getting leverage through consulting engagements, having a team that functions as an agency, and/or packaging up your knowledge and process sawdust as digital products. Once you taste leveraged, non-service income, you can’t untaste it.

The main financial goal for Diversifiers is replacing a big chunk of service revenue with non-service revenue. High-ticket consulting engagements definitely give you the warm fuzzies, but generating $1,000s or $10,000s by sending out a handful of emails feels even better.

Career progressions for freelancers keep going from here, but I’ll past the baton to my friend Nathan Barry, the founder and CEO of ConvertKit, who wrote “The ladders of wealth creation: a step-by-step roadmap to building wealth.” Diversifiers curious about what’s next should give it a read.

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