Startups or Not

What I’m reading: Guide to Human Conduct by P. R. Sarkar
What’s on the iPod: Better Together by Jack Johnson

Back to normal. With Mom back home, I had about three hours uninterrupted to get some work done. I managed a good bit. I have a head start on the newsletter project, all parties contacted, and one interview already done. Let’s hope today is as productive.

Thanks again for all the comments and support for Writers Worth Week. And now, thanks to an online random number generator, here are the winners of The Worthy Writer’s Guide to Building a Better Business:

– Ronda Levine
– Mojo
– Jake P.
– LC Gant

Congratulations! Drop me an email and I’ll send you over your copy today. Thanks again, everyone!

On one of the blog posts I wrote last week, a small discussion ensued about what types of clients some writers avoid. One writer said she avoids clients who are startups and individuals. I can see that as valid. And yet, I can’t.

I too have had no end of issue with startup companies and the occasional single client. The first tends to put all its money into the trappings – shiny new offices, slick technology, and the best possible address for the price – and forgets that there will be additional expenses, such as contractors. One odd truth I’ve come across: the slicker the business card, the less likely they’re paying anywhere near your fee.

Yet there are any number of great startups that have planned and budgeted for contract help. The same with individuals. The difference seems to be in the contract itself. The strength of the contract at the outset is the best indicator of how well the relationship will work.

That’s not to say they won’t test it. I had a client that decided midway through a project that the fee we’d contracted at wasn’t something they were interested in paying any longer. They said “We’ll just pay $XX for this.” Right. And I’m going to fly to the moon next week.

What needs to be in that contract to protect you?

Sensible payment terms. It’s not enough to agree to three installments with the third coming “at the end of the project.” There’s the loophole – who and what defines the end? If you’re smart, you will. Always put a date on that end payment. I learned this the hard way when one project dragged on for a year.

Hourly limits. If you’ve not worked for the client before, make sure to spell out how many hours of your time that fee is paying for. Otherwise, that $3,000 fee could dissipate under 12 rounds of edits and months of back-and-forth.

Revision limits. Make sure you allow your clients enough revisions to get their project to a good place. However, don’t give them endless edits. That is interpreted as “Well, if we want to tweak this in six months or a year, we can.” I give them three edits, then we start charging my hourly rate for each additional edit or rewrite.

The number of people involved. You who know me know how I feel about posses – those friends, family, and colleagues who suddenly show up at the tail end of your project to give your client (and subsequently you) a ton of editorial advice. I’ve had client relationships dissolve as a result of the posse’s involvement. Now my contracts state very plainly the parties covered under the contract, those who aren’t, and what will happen if Uncle Fred now decides he can write better than the paid professional. The minute Fred appears, the contract is void and full payment is due immediately. And yes, I’ve had to wield that clause once or twice.

Project parameters. Spell out exactly what you’ll be doing. It clarifies it in everyone’s mind, and it helps you avoid project creep so your article doesn’t morph into a white paper or a manual.

Writers, what do you put in your contracts? What are your thoughts on working with startups and individual clients? How do you know when it’s a good fit?

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Comments

  • Eileen May 17, 2011 at 12:55 pm

    A startup business can be a good client if the business owner has started and succeeded in other businesses before. I've worked with a couple of serial entrepreneurs who were gifted in building profitable businesses. Very few people have that gift, however, so you have to be very discerning. Once you've worked for one of these folks with the golden touch, you can spot the wanna-be's a mile away (and avoid them).

    Reply
  • Devon Ellington May 17, 2011 at 12:56 pm

    I think I commented on that post. The poster said she didn't take jobs from start-ups or individuals. Now, I've been hired to write speeches and script doctor and all kinds of stuff by "individuals", and that's often the highest paying and best work.

    I've also worked for a number of start-ups, who have been great. Some haven't been, but you have a strong contract, and if it's a bad experience, you don't work for them again.

    Deposit, deposit, deposit. That way, you at least have some cash in hand, even if it gets wonky further on.

    Contract, contract, contract — that includes all the points you listed.

    My clause is two edits/revisions, wiht additional edits/revisions (which are two different things) and/or change of direction billed at my regular hourly rate.

    Reply
  • Cathy May 17, 2011 at 12:56 pm

    I don't use an hourly fee. I quote projects fees and I list the scope of services. In that I include things like whether or not it Includes consulting calls, the # of rounds of revisions included (typically two), the approximate word count, etc. I have a timeline, which includes a statement that is based on the client delivering all requested info. by XX.

    My terms include a 50% deposit upfront and states the work will not begin until it's received. If it's less than a certain $$ amount, the full fee is payable upfront.

    I think it's wise to be cautious about individuals or start-ups as clients, but with a tight contract and terms, you usually find out pretty early who is going to be a problem and I would just not take it on. I have had several successful projects with individuals as clients, albeit, smaller projects, but they knew the terms upfront and I didn't have a problem.

    Reply
  • Damaria Senne May 17, 2011 at 1:21 pm

    I've worked for individuals and start-ups who've paid well and fast, so I'm not averse to working with them. But I've also learnt to be careful – had a client tell me that since she didn't use the material I generated, she's not paying me.
    As Devon says, contract, contract, contract. That's what will protect you if things go sour.

    Reply
  • Damsel May 17, 2011 at 1:45 pm

    Great post. Thank you so much for the tips, and I'm looking forward to following the discussion in the comments.

    As a newbie, I'm scouting for sample contracts and advice in this vein. Can you direct me somewhere for those? Thanks!

    Reply
  • Lori May 17, 2011 at 1:55 pm

    Damsel, if you send me a note, I can share mine with you….

    Reply
  • Jake P May 17, 2011 at 2:57 pm

    Eileen makes a great point about identifying an entrepreneur with the "right stuff." I don't hesitate to work for someone who's been successful in other pursuits. If you just have a cocktail napkin and a dream, on the other hand…

    And my record for longest project drag-out was 18 months from first meeting to last — for a 10-page website! Talk about indecisive. And it underscored a principle I've experienced a couple of times over the past 12 yrs: If you're doing a job for a physician, estimate VERY high. You're gonna need it.

    Thanks for the good news on the ebook — looking forward to reading it!

    Reply
  • Paula May 17, 2011 at 3:18 pm

    Before I read Damsel's comment, I was already thinking, "Wow, you guys should compile a booklet full of sample of effective contracts for various kinds of projects." Seems like a potential money maker.

    Include a few contracts from related professions – graphic designers, freelance PR pros, website designers, etc… – and you'd have a fairly large customer base.

    Reply
  • Cathy May 17, 2011 at 3:25 pm

    @Damsel-If you'd like, I'd be glad to share mine as well. You can pick & choose what you like. My email is cathy@millercathy.com

    Reply
  • Lori May 17, 2011 at 3:58 pm

    Eileen, super point. If this is someone used to doing business, that's a great relationship to build. I guess my "business card" trick is my way of spotting the posers. 🙂

    Devon, you did comment. I think avoiding these clients is a bad idea, though I see where she's coming from. She was painting all individuals and startups with the same brush. Mind you, I've had my share of headaches with folks from both those groups, but I've had issues with magazines and established businesses, as well. Like you said, contracts are essential.

    Cathy, I think where some get into trouble is when they're negotiating, they're not paying attention to the signs. Bad clients give us signs – they want a reduced rate, increased work for that same rate, weird conditions on payment or work, freebies, etc. You can tell the problem children if you're looking for them.

    Damaria, I had that from an established client. The option to pay only if you use it isn't included. I get paid no matter what you do with the work produced.

    Jake, thanks for the advice. I've seen similar foot-dragging from clients. It hurts so much less when the client is paying at pre-set intervals. 🙂 Wow. Eighteen months. I came close – 15 – but luckily was able to convince the client I'd honor the contract if he'd just pay me already.

    Paula, good idea! Could be a great collaboration among us.

    Reply
  • Ashley May 17, 2011 at 4:28 pm

    I've been piecing my contract together for a while now. I think it's pretty solid, but I would love to see yours too, if you're willing to share.

    I've already included each of the points you made in your post. I have heard too many horror stories of project creep, and I like to learn from other people's mistakes in addition to my own, so I'm always sure to include exactly what is included in the project.

    I do have an admission … I don't use a contract every time. And I know I should. I tend to trust people and think they'll come through because *I* am trustworthy and come through on the things I promise. Sadly, not everyone is like that. Do you, Lori and commenters, always use a contract?

    Reply
  • Lori May 17, 2011 at 5:23 pm

    Ashley, if I've worked with the magazine or client before, I let the email agreement stand as my contract. But I'm clear in email and get them to confirm the payment, parameter, and expectations.

    Reply
  • Wendy May 17, 2011 at 5:34 pm

    Doing the happy dance for the winners! It looks like a great prize. Good job, Lori in picking the book as the prize to not just one, but four people. You don't see that very often.

    Reply
  • Lori May 17, 2011 at 5:45 pm

    One for every year we've done this, Wendy. Seemed fitting. 🙂

    Reply
  • Cathy May 17, 2011 at 7:18 pm

    So, you mean there's a method to your madness, Lori? LOL!! 😀

    Reply
  • Lori May 17, 2011 at 9:58 pm

    Occasionally, Cathy. 🙂

    Reply
  • Wade Finnegan May 18, 2011 at 4:41 am

    It is wonderful how writers are willing to share. I believe if we were in other businesses those contracts would be guarded secrets. I believed email communication could be used as proof of agreement, but I see now that I need to work on a contract. Any generic ones on the web to get me started? I'll do a search. Cathy and Lori I will send you an email if that is alright. Thanks.

    Reply
  • Lori May 18, 2011 at 12:01 pm

    Wade, generic ones can get you started, but they miss the details. Definitely send me a note.

    Reply
  • Susan May 19, 2011 at 2:04 am

    Approximately 90% of my projects are hourly at this point (and I shudder when I read that list, which is why I work hourly).

    I do have to admit, though, this year was the first time that I was bitten even with a contract in place (and to be honest I don't even know how enforcable they are). However, my goal this year: Learn more about contract. Probably hire a laywer to review contracts, too. Ugh.

    Reply
  • Lori May 19, 2011 at 5:14 pm

    Susan, it may be money well spent. I don't know all that much about contracts, but the little I've learned has made me dangerous. 🙂

    I like working hourly – except when you get a clock watcher. I had one client relationship flame out when she tried to keep me at two hours for a major rewrite. Even with my explaining how impossible it was, she was surprised when the result wasn't stellar. I was done with her. Spend what you need to in order to get it done right or stop pretending to be a professional business person.

    Reply