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(Last Updated On: February 10, 2019)

People decide to become freelancers for the same reason that they decide to start a small business. They want to be their own boss and open up new money making opportunities for themselves. But a lot of people still don’t realize that you can transition from one into the other. If you set up a freelancing service and you’ve started to find some good clients, you might want to start thinking about your next steps. If you’re lucky, you’re going to get to the point where you’re getting more work than you can handle on your own. This is where you can start thinking about turning your freelance service into a fully-fledged small business. But you’ve got to be careful because you’ve got a good thing going here and you don’t want to mess it up by overreaching. If you’re thinking about making the move from freelancer to small business owner, here are some great tips to make sure you don’t mess it up.

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Be Prepared For New Challenges

A big mistake that people make is thinking that owning a small business is just an extension of being self-employed. You’re already finding your own work, managing your time and sorting out your tax affairs. But there are a lot of extra responsibilities involved in running a business that you won’t be used to. Things like hiring and firing employees, leading a team, and dealing with all of the legal hurdles that come with running a business. If you aren’t prepared for those new challenges you’re going to jump straight in at the deep and sink straight away. Before you make the move, do your research properly so you know exactly what being a small business owner involves.

If you’re worried about meeting those challenges, it might be worth getting some formal business training before you start moving toward being a full-time small business.

Be Cautious With Office Space

You’re going to need some office space for your new company and you’ve got to be really careful here. So many people have failed because they spend loads of money on a massive office space that they can’t afford and burn through all of their cash. When you’re looking at commercial lettings, don’t get drawn in by a fancy sales pitch. Look at what you can afford and set a budget before you go, and stick to it religiously. Just rent the space that you actually need and then you can upgrade later on when you’re making more money.

Take It Slow

If you just hire 5 more people and a big office right away, you’re not going to get enough work to pay all of those people. You’ve got to start out slow and build it up if you’re going to do it without the massive risks. Just find one or two more freelancers and get them to help you out with the extra workload on a short term basis. If it goes well, you can think about hiring an office space and starting a proper business.

The most important thing is that you don’t jump the gun when you’re trying to make the transition from freelancer to small business. Take it step by step and don’t let your spending get out of control.  


27 / Nottingham, UK. Trying these things since 2007. Writing about these things since 2014. Doing this full-time since 2018.