Neil Lewis - Innovative Entrepreneur

Solving problems by growing profitable businesses @neil_lewis

Why freelancers make great startup equity partners


You know I’m a big fan of working with freelancers.

You’ll also know from my many blogs and articles that it is not the tax breaks that really interest me – but it is the better business attitude.

Better business attitude?

Yep, freelancers have a different attitude to work from the majority of employeed staff – and I mean a far better one!

Freelancers understand from day one that what they do MUST make a difference. Freelancers that don’t deliver don’t tend to hang around for very long!

I’ve even produced a short summary of my book – 100 rules for entrepreneurs – giving 20 reasons why entrepreneurs should hire freelancers (which you can download here ).

However, there isn’t a week that goes by that I don’t see a startup business plan projecting future revenues building and employed staff numbers jumping….

… and it is always an early task of mine to remind the startup founders that non-equity staff rarely think like you (the founders); but many freelancers do…

The breakthough

All of which led me to a breakthrough this summer…

Essentially, if entrepreneurs want to keep putting fixed and rigid employed staff costs into their plans and miss the fabulous opportunities that working with freelancers offer, then what-the-heck, why don’t we build businesses with freelancers in the first place?

After all, what could be better than 10s or 100s of successful startups lead by ex-freelancers who want to work with other freelancers – because they just *get it* about freelancing?

Which is why I am looking to work with freelancers to build and structure 5 new startup businesses.

So how do we select freelancers for startups?

Freelancers who make great startup equity partners are people who are willing to take a risk.

They also tend to be strong team players – but equally, can bring an individual edge or perspective from their industry or discipline.

I’ve found the following two key steps work best for me when identifying who to work with….

…the first is to ask the freelancers to come to a fee-based workshop – in fact I’m running my next workshop in Manchester on the 12th of October.

This tends to separate out those who have the commitment to turn up from those who are ‘just interested’, but not really excited by the prospect of being part of a startup opportunity.

Secondly, using the eTeamTool – developed with Manchester Business School – we have created an entrepreneur assessment which allows us to spot the key strengths and weaknesses of each person – from the perspective of an ideal startup team.

Yes, we all have strengths and weaknesses!

Using the eTeamTool, we can then start to fit different people who have different startup skills and experience together, to form the strongest possible teams – far stronger than any one individual who is by him or herself.

The work, using this tool, that we have done with business accelerators such as Springboad, has enabled us to identify the strongest startup teams as consisting of

a) an original idea (typically owned by one of the startup team members)
b) a development / engineering team who can turn the idea into a prototype and then a functioning product (and products)
c) a market fit team – who can invent or persuade a market to adopt the new product or service, and
d) a senior non-exec with experience in that industry or sector (remember, non-execs were the first business people to go freelancer)

Effectively, a startup team needs to consist of at least 3 people – and possibly upto 5 (but unlikely more).

In some cases, there will be a senior and a junior member of the commercial or market fit team – or perhaps the development team – depending on whether the business is slanted more heavily towards business to business sales and marketing or technical developments etc…

Why freelancers make great startup equity partners

Which gets me back to my original point – why freelancers make great equity startup partners…

because freelancers understand better than most how working in a team – of different talents – is a strength – but critically, only when there is respect for the different talents being bought to the table.

So, in a nut shell, freelancers learn to collaborate successfully with people from different disciplines; and it is this experience that makes them idea as startup partners.

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I’m helping to launch 5 new businesses – all of which need startup equity partners. Join my startup workshop in Manchester on the 12th Oct and see where you might fit in…
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Written by Editor on September 26, 2011 and filed in Entrepreneurs, Featured, Freelance Jobs, Innovative Entrepreneur, News, Opinion , , , , , ,


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