Hiring Freelancers for Your Startup? Consider These Pros and Cons

The benefits of hiring freelancers

If you’re considering hiring freelancers, there are five major benefits you can look forward to.

Flexibility

Freelancers can be an excellent staffing solution for companies that need the flexibility to scale their workforce larger or smaller at a moment’s notice. This level of agility is great for startups that are still determining what level of staffing they will need.

“Freelancers are essentially fractional workers,” said Lindsey Chastain, founder and CEO at The Writing Detective. “Employers may not need a full-time employee to complete the work needed. That’s a great place for a freelancer to step in. Employers also don’t have the expense of benefits for a freelancer.”

Cost savings

Another benefit of hiring freelancers is the price of services. According to a Global Freelance Income Report, the worldwide average hourly rate of a freelancer is $28. Although this is much higher than the average rate of $21 two years ago, it is still less than what you would likely pay an employee in a similar position. This is because of the total compensation — the full monetary value of salary, fringe benefits, and bonuses — you pay employees. In contrast, you are free from the cost associated with health insurance, infrastructure setup, sick leave and other expenses related to hiring and paying in-house employees.

“By hiring a freelancer, employers are able to work with premier talent without committing to paying a year round salary,” said Natalie Bleza, founder and public relations specialist at Natalie Bleza PR. “If you want to ramp up support around your business’s busy season or activate on a short-term project, you can hire a freelancer to take advantage of this cost efficiency.”

Diversity

Hiring an employee outside your city, state or country can come with a lot of extra steps that are often complicated for small businesses to tackle. This limits the talent pool you can hire from. With freelancers, you are not limited to one location — you have the power to search globally. This is especially relevant for countries, such as the United States and the United Kingdom, where the demand for tech talent exceeds the local supply.

“A freelancer’s fresh set of eyes on a project can be invaluable,” Bleza said. “Each freelancer brings their own experiences to a project, so having an outside perspective may be the key to unlocking success and removing blockers.”

Availability

Today, finding and hiring freelancers has become relatively quick and painless, especially with the rise of platforms that assist in finding and hiring workers online. Such platforms enable business owners to streamline the entire hiring process, from posting job offers to selecting and working with the best-fit candidates. You can also track your freelancer’s performance and choose a convenient payment model (hourly rate or fixed price), depending on the scope of work you need.

Skills and expertise

Hiring a freelancer means having the freedom of choice among varying skill sets. You can find workers specializing in even the most hard-to-find technologies or with background experience in emerging areas, such as artificial intelligence, machine learning and Internet of Things. This can be especially useful if you have a particular project or job that requires a worker with an advanced skill set.

The risks of hiring freelancers

If you’re considering hiring freelancers, there are five potential limitations to be aware of.

Missed deadlines

Many freelancers juggle multiple projects simultaneously to make the most of their time. However, they sometimes can’t realistically evaluate the scope and timing required to complete each separate task and put too much on their plate.

To cope with a growing amount of work, they focus most of their time and energy on projects that offer higher wages or have a deadline coming up. Consequently, they can fall behind schedule with other responsibilities and miss their deadlines.

Communication

Effective communication is integral to business success. However, you may find it difficult to communicate with some freelancers. Due to the heavy workload and irregular schedule of freelancers, their response time to urgent requests is often long compared to your in-house employees. This can become a problem if you need them to complete an urgent project with a tight deadline.

“If a freelancer is unresponsive in a reasonable amount of time, that would be a red flag. Another red flag would be lots of negative reviews or poor quality work in the portfolio,” Chastain said.

Reliable freelancers tend to have references and be proactively communicative, so screen for these qualities when bringing a freelancer on. Consider starting them out with a small project and see how they do before trusting them with more important work. 

Lack of commitment

Low commitment is a common issue among remote freelance workers. Due to the vast availability of choices and lack of contractual obligations, they may quit your project abruptly in favor of another or keep it on the back burner until the deadlines start closing in. If a freelancer decides to bail on your project at the last minute, you may be left scrambling to pick up the pieces. This level of instability can be a problem for some employers.

“The main disadvantage for employers is that a freelancer is not an employee and therefore not subject to rules employers may want the freelancer to follow,” Chastain said. “Freelancers usually don’t work with just one client at a time, so their time is divided. They may not be available at short notice as their time is booked.”

If you need dedicated employees you can count on, consider hiring a part-time employee or working with a temporary employment agency. Freelancers, unless you already have a rapport with them, may not have the availability to commit to your needs.

Quality control

Hiring a new freelancer is a risk. You won’t know for sure if they can do the job (or do it well) until you give them a shot. This can leave you with varying levels of product quality throughout your organization, based on each freelancer that comes and goes. What’s more, some freelancers may not have the necessary software and tools, which also affects project quality.

“If the freelancer is giving you sloppy work, don’t keep using them,” said Alyson Austin, principal and founder at Gaffney Austin, LLC. “It is too costly for a business owner to redo work we are paying for.”

Security

Transparency and security should be a top priority for startup founders working with remote freelancers. Employees are known to be the weakest link within any organization’s cybersecurity chain, and you can expect temporary employees and contractors to top that list. Freelancers have no loyalty to you, and yet they have access to your company’s systems, data repositories and process documents.

Remote cooperation often limits your ability to control the entire process. Therefore, it’s important to set clear security guidelines you want your freelancer to follow as well as conduct regular checks to ensure your assets are kept safe.

Tips on effective cooperation with freelance workers

If you do decide to hire freelancers to help you grow your business, here are a few important tips to follow for a solid working relationship:

• Ask your colleagues for recommendations or contact an experienced staffing agency to provide you with a base of reliable and vetted freelancers.
• Use platforms that provide guarantees and examine the online reviews and former work experience of potential candidates. Cooperation via freelance workplaces also simplifies the payment process between different locations.
• Explore the market specifics of your target country and consider the time and cultural differences before making any hiring decisions.
• Try to keep your team stable — work with trusted freelancers on a long-term basis instead of constantly engaging new people.
• Keep your communication lines open, arranging regular standups and video calls to ensure everyone is on the same page.
• Use a set of tools for task tracking, continuous integration and shared repositories to keep track of the team’s progress.
• Create a hybrid team chat where your dedicated employees can communicate with freelancers to maintain a sense of integrity between freelance and in-house workers.

Overall, cooperation with freelancers entails both benefits and drawbacks. Some of them might not live up to their promises or meet your expectations while others might help you solve a myriad of critical and urgent issues in a matter of days. However, by following the tips above, you’ll avoid a number of pitfalls and drive maximum value from working with freelance specialists.

Tejas Vemparala and  Igor Tkach contributed to this article.