Everything You Need to Know About Hiring a Freelancer: By Devon Campbell

Often when entrepreneurs are first starting out, they turn to freelancers to carry out tasks, rather than full-time employees. This strategy tends to be cheaper, requires less paperwork and onboarding time.

Here is a†rundown on how to successfully land the perfect freelancer for your project.

Where do I find them?

If youíve done even a little research into hiring a freelancer, youíre probably aware of the 800-pound gorillas of freelance marketplaces: Elance and oDesk. These are both great resources, as youíll find tons of freelancers from all over the world with a wide range of skills. They sound like the perfect solution for all your freelancing needs, but itís not all sunshine and rainbows.

Related:†5 Guidelines to Maximize†Freelance†Employees

As a freelancer, when I first started looking for work, I observed postings on oDesk for potential jobs. I frequently saw postings asking for ďWeb developer, no more than $2.50/hour.Ē Obviously, these ads are targeting freelancers in developing markets, but these rates lower the overall perception of value for the services Iím trying to provide in the marketplace. I couldn’t compete in that marketplace.

If you hire this way, youíll save a few bucks, but youíre going to have to overcome quite a few obstacles to get there. If you choose a contractor outside your region, will they be available to communicate when you are?

Imagine you wake up, review the work that took place on your project overnight, find a problem, and email a request for changes to the contractor. Your contractor likely wonít be able to deal with the problem until their next work day, and you wonít see the results until the following day. What if it still isnít right? Can you afford that sort of overhead for every issue that pops up? Also, you may run into language barriers, which make it hard to explain your vision.

Because of these issues, I have friends who just specialize in on-shoring web development projects. All they do is take over development projects that were originally sent off-shore. Most are now months behind schedule and well over-budget with plenty of work still to be done. Their clients bring them the work, because theyíve found itís simply easier all-around to deal with people in their region, even if the rates are higher.

Thatís not to say Elance and oDesk donít have great people from all different regions. They are out there, but they are constantly being squeezed by lower and lower rates. Some stick it out and some flee and †never to return.

Two of my favorite sources for development work are Gun.io and Authentic Jobs. These boards have great jobs that pay well. It may cost you a bit more, but it will be worth it to find the right person. Folyo is a similar board for designers. A quick search will reveal similar boards for various other areas of expertise.

Somewhere in the middle, youíll find Redditís forhire subreddit. The rates may be higher than oDesk, but itís not quite the caliber of Gun.io.

You may find that the best source of freelancers is your local community. Unless you live in the remotest of places, youíre likely to have some developers in a 50-mile radius looking for work. Local freelancers can be found in Meetup groups, chambers of commerce, business networking groups and groups that provide support to entrepreneurs. Ask other business owners who theyíve used. Maybe check around the coffee shop for someone using a computer with cryptic stickers covering the case.

Related:†3 Legal Precautions in Hiring†Freelancers

Being able to meet your contractor face-to-face will give you a much better idea if the relationship is a good fit. The Internet has broken down many barriers, but itís still extremely difficult to get a read on someone online. Meeting in person will give you a really good idea in just a few minutes.

How much should I pay?

Freelance rates are all over the place. I recently talked to a startup who has been quoted between $9,000 and $750,000 for the same project! How can you even begin to evaluate what is reasonable?

One approach is to evaluate pricing based on the effort you believe is being expended on your project. Talk to a friend with experience in software engineering to get an estimate. It might be worth your time to dive right into an introductory Thinkful courses (online school helping people advance their careers), so you can get an idea what will be involved in your project. Once youíve done this, you can probably ballpark a number of hours or at least get closer than you would have before. Some simple division will tell you what youíre paying hourly to complete the project.

Web developer rates in the U.S .generally range from about $40 an hour up to $300 an hour — and beyond.

But evaluating quotes just based on price can be counterproductive. It assumes that the time and effort of the freelancer is what you want to buy. Most likely, you instead want to attain some result from the service being offered.

An astute freelancer will realize this and change the conversation accordingly. They will dig deeper into your business, wanting to understand more than just your specifications for this project. They will want to understand how this project will impact your business and what other ways they could add value based on the way your business works. They will sell you on the results rather than on the process.

Related:†How to Make It as a†Freelance†Entrepreneur

Imagine yourself in each of these two scenarios. You talk to a developer about a project, and she quotes you $10,000. You pay and everyone leaves happy.

Now, imagine you bring the same project to a different developer who is also interested in your project. That developer spends half a day with you getting to understand every aspect of your business, makes suggestions and tells you you’ll receive a ballpark ROI for this project of $30,000 a year. This developer will do the project for $20,000. While thatís twice the price of the first developer, this new developer has already added value to your project by suggesting changes that will increase your return. They have also changed the product they are offering you: Instead of buying time and effort, you are buying a way to increase annual revenue by $30,000.

How do I pick the right one?

Even if you have the advantage of meeting your freelancer, itís a good idea to give them a relatively small job for starters just to be sure you can work well together. Shave off a small piece of the overall project and give them that first. Itís something of an insurance policy.

Whatever you do, please donít ask your freelancer to do speculative work or to complete a project for free with the promise of more work later. Itís disrespectful of the freelancerís time. If you canít afford to test the freelancer with a project and if the freelancerís portfolio and references are not giving you confidence, itís best to move on leaving everyone with dignity intact.

As mentioned previously, meeting in some capacity — be it online, over the phone or in person — will help you figure out if you can work with this person. Iím sure Iíve turned plenty of people off my services just by being myself. This works out better for all parties. Why would we want to work together for six months or even just a month if we donít get along?

Youíre almost thereÖ

Thatís right. Almost. Itís impossible for me to impart all the knowledge youíll need to hire the perfect person. Youíll have to try it for yourself to learn the rest. Your experiences will be unique and will shape the wisdom you take away from the bargaining table and into the next freelancer you hire.