If you’re just starting your business like I am, then you need to decide: Am I a freelancer or an entrepreneur? As my life had been growing increasingly complex, I was faced with this very decision.

Yes, this advice has been dispensed many times before. The point of this particular post is to share my story and persuade you to not repeat this mistake if you find yourself in a similar situation.

Drawing a line in the sand: I am an entrepreneur

My dream for a number of years has been to build Live Editor. I’ve had a vision for the product since around 2007 but only started acting on it recently.

Because I want to build a product (entrepreneur) and not trade hours in the day for dollars (freelancer), this dictates what I need to focus on:

  • Building a great software product
  • Experimenting with marketing strategies for the product
  • Building infrastructure for the product to run on
  • Supporting users of the product

Because I am doing this alone, I would seriously damage any chances of success if I shifted my focus to anything else. There are only so many hours in the day, software is hard, and I don’t want to create anything half-assed.

The deadly allure of freelancing

Consulting/freelancing is a choice, and it is right for some people. I have the privilege of knowing some guys who are natural-born consultants, excel at it, and I couldn’t imagine them doing anything else.

But, like I said, it is a choice. If you have very limited resources (especially time) and want to excel at what you’re doing, you cannot build a product and consult at the same time. I made a mistake in thinking that I could do both, even though I’m married, have a baby on the way, am shopping for a house, and have other social obligations that I do not want to give up.

Here’s how I was lured into thinking I could do both, and the reasons why it was flawed logic.

(Italicized headings should be ready in whiny guy voice.)

The guys at Basecamp did it. They were freelancers, built Basecamp, and eventually were able to transition to doing Basecamp full time.

Basecamp (formerly 37signals) were making a full time living doing consulting. They already had the resources to make a living off of their consulting and then build the product in their spare time.

It is different for me because I have a day job that pays my bills for now. My spare time cannot be split into consulting and building a product if I want to finish the product anytime this decade.

I need to build a customer base. Consulting will allow me to have a customer base that I can market Live Editor to.

Consulting is one of the worst ways to scale any kind of customer base. Think about it: you need to do hours of work to keep the client happy, and you need to be in constant contact with clients to keep bringing in more work.

All that said, there’s no guarantee that the clients would even want to be customers of your product anyway. And there is no guarantee that you can keep the client happy until you launch your product. Sounds extra risky to me.

I’ve finished 5 consulting projects over the past couple months. I feel better about it than creating my product.

It all started with one client, who loved what I was doing, so they referred another client. Then a family member referred some work. This momentum of “quick wins” barreled forward and felt great.

All of a sudden, I was juggling a few projects, when all I wanted to be doing was work on Live Editor. I felt trapped. I don’t want to feel like that again.

I need more money. Freelancing helps me pad the bank account.

At this time, most of the cost for building Live Editor is my time and energy. My biggest expense money-wise is hosting at Heroku.

Though their hosting feels pricey during this period of zero income, I cannot produce a scalable hosting environment anywhere near what they provide. As a one-man operation, I need to focus on the app, not the hosting infrastructure.

There is overlap between the consulting business and the product business. That’s efficiency that I can exploit!

Both businesses needed websites. Sometimes I can learn things for client projects and apply it to my product business. Both businesses deal with the web. Why not keep doing both, right?

I could imagine the killer scenario later down the line: the same problems that I’m experiencing right now, but I instead push the problems onto employees. They want to be working on Live Editor, but they need to figure out why the fonts aren’t loading properly on Client X’s website. So very annoying.

Stop it. Focus. Simplify. And stick to it.

Much-needed simplification after killing consulting

Now that I’m done consulting, these are the things that I can remove from my list of worries:

  • Building and maintaining websites for clients
  • Separate consulting website and marketing strategies for my own consulting business (or, better yet, I could market both services on the website and confuse customers)
  • Billing, communication, and other administrivia with clients
  • Finding more freelance work
  • Learning new things to support client initiatives that I don’t need for Live Editor
  • Another bucket of tasks to manage in OmniFocus

Removing these worries makes a big difference. It’s hard enough to start one company, let alone two at once.

My mentor once told me, “You know it is a good decision if you feel relieved after making it.” That’s how I feel now.