The entrepreneurial life is great, but it’s also stressful. One of the most stressful components is figuring out the right portfolio of clients. Should you have one, or 10? How much of your income should come from each?
While the answer varies for every business, here’s some advice from veteran soloists on how to diversify without spending your life hustling for new revenue.
Every free agent needs one core or anchor client. Career blogger Alexis Grant defines this as "a client that pays you a good chunk of what you need to earn every month, and on a recurring basis." Bonus points if the work is pleasant and doesn’t take too much time or mental pain.
"If your model revolves around recurring work, you will spend less time trying to land work and more time actually doing the work," she says.
But note the caveat:
If you do, you risk going adrift. Caitlin Kelly, a journalist and author of Malled: My Unintentional Career in Retail notes: "It’s terrific when you find a regular anchor client—or several—who love your work and want plenty of it."
But she warns no situation lasts forever. "I recently lost a fantastic gig with one client—who had become 50% of my income stream—when an editor I loved got promoted and a new person took over that spot," she says. Losing half your income is never a fun situation to be in; Kelly now spends much more time reaching out to potential clients.
Target at least three decent-sized clients so no one is the bulk of your business. Above all, there’s variety, notes Melanie Padgett Powers, a provider of social media content strategy, editing, and other services.
"It rarely gets boring," Powers says. "Sometimes I'm proofreading a magazine about parking garages, while other times I'm writing features about minority lawyers or advances in optometry. And I get to research and play on social media a lot and try out new strategies for my clients. All of that keeps me energized, motivated, and excited to 'go to work' every day in my home office."
You may also decide that an anchor client no longer represents the right direction for your career. Walking away from 25% of your income is tough, but walking away from 60% is tougher. People get stuck.
One solution? Aim for multiple recurring clients, with each constituting no more than 25%-35% of income. Powers says she has three recurring clients that together come out to a bit more than 50% of her target. That’s a good start, and then the rest can be one-off or occasional projects.
Even if you have plenty of work, smart free agents treat their networks as a client that must also be tended.
"If you’ve put your network in place and actually cultivate it so potential clients come to you, you can count on that network to come through when you have capacity," says Grant. You’ll be offered interesting projects that can become the non-anchor parts of your business.
That’s Minal Hajratwala's strategy. She teaches several online courses on creating proposals. She also takes on a few coaching clients. Coaching work ebbs and flows for her, but she says she has it all figured out.
"I have pretty good luck bringing in more clients if I spend more time on social media, so that’s also within my control," she says. When she needs it, it’s there.
One of the best parts of running your own show is that you can choose to bend your rates because you’re passionate about a cause. While you don’t have to do this, over the long run it can keep you motivated.
Powers says she recently helped a public library foundation learn how to more effectively use its Facebook page to educate the community about the need for building a new library.
"I charged a little less than my hourly rate for this because I really believed in the cause and knew the group had a small budget," she adds. "I felt the few extra pro bono hours were worth the personal fulfillment."
Windfalls don’t just happen. They require some investment of time—however small—along the way. So the final piece in the portfolio should be a few "hey, you never know" investments.
That short e-book you write probably won’t become a bestseller, but it might. You likely won’t win a fellowship that pays for you to travel the world for a year taking photos, but you definitely won’t win if you don’t apply. Save some energy for purchasing the free agent equivalent of lottery tickets. Over time, you just might cash in.