7 Steps to Start a Freelance Business (With a Full-Time Job)

Omid G Feb 23, 2023

I made a lot of mistakes when I started my freelance business over a year ago.

It took me 10 months to figure out what I was doing, but it could have easily only taken one month if I had a framework for how to approach starting a freelance business.

My goal with this article is to equip you with the knowledge, tools, and resources to get your freelance business up and running — regardless of if you want to do it part-time on the side of your full-time job, or if you want to quit your job and become a full-time freelancer.

But before we dive in, let’s address some common questions.

Do Freelancers Make Good Money?

The amount of money you make as a freelancer depends on the types of services you offer and the types of clients you work with.

According to Fundera, freelancers contribute $1.3 trillion to the US economy each year. And according to the same study, the average income for full-time freelancers is around $68,000. Depending on where you live, this can be a great income.

This is why I always recommend people start freelancing on the side of their full-time job. Having just one client with a full-time job can make a world of difference to your overall income. And once you get the hang of being a freelancer, you may even make more than your full-time job.

So bottom line, freelancers can make good money. But the freelancers that I know that make a lot of money are the ones that niche down as much as possible and get really good at providing just one service.

How Much Does it Cost to Start a Freelance Business?

Freelancing, and starting a service-based business in general, is regarded as a low barrier to entry type of business to start.

The short answer is that it doesn’t cost a lot of money to start a freelance business. In fact, you can start with nothing. But it does cost you in time to acquire and deliver a skill that people are willing to pay for.

Also, depending on the type of freelancing you’ll be doing, you might have to pay for some software tools or even a computer.

How Can I Legally Be a Freelancer?

If you want to start your freelance career on the side of your "regular" career, you need to make sure your employer is okay with you doing so. Sometimes when you agree to work somewhere full-time there’s something in the contract that says you can’t work with similar companies in the same industry.

The other thing you want to be mindful of is taxes. Ideally, if you’re in the US, you start an LLC (limited liability company) that you use solely for your freelance business.

We’ll get into freelance marketplaces later in this article, but some marketplaces know that freelancers just starting don’t have a real business.

How to start a freelance business in 2023 (in 7 steps)

Here are seven steps to starting your freelancing business:

1. Identify Your Services

The first step in starting your freelancing business is to get crystal clear on what type of services you are going to offer.

2. Create Your ICP (Ideal Customer Profile)

The service you provide is important, but the types of clients you provide that service to determines your revenue potential.

3. Get on a Freelance Marketplace

You can find some great freelance jobs on Upwork — it’s by far the best freelance marketplace if you’re just starting out and want to go broad (IMO).

4. Sign Your First Client

The first thing you should do is figure out how you could position yourself as a subject matter expert.

5. Onboarding Your Client

The main takeaway is that you want to create a 10/10 experience for your clients from the start because it will help with client retention and growing your network.

6. Getting Paid and Managing Finances

When billing clients, it’s first important to know what your payment structure is.

7. Stay Organized With Your Full-Time Job

Committing to a 40-hour-a-week job while also potentially putting in another 5-20 hours a week on freelancing can be tough if you don’t know how to batch tasks together.

Conclusion

Learning how to start a freelance business can be a very fruitful endeavor. If you want to become a successful freelancer, you need to get really good at knowing what service to provide and to who it makes the most sense for.

Hopefully, this article gave you some insights into starting your own freelance business.

Happy freelancing!

Omid G Feb 23, 2023