How To Form An LLC

In the 200kfreelancer’s latest post on AARP’s Life Reimagined, we offered five questions to ask if you’re thinking of forming an LLC.

Most entrepreneurs form LLCs to protect themselves from liability. An LLC creates a separation between yourself and your business. That’s smart.

An LLC agreement. can also support collaborative decision-making, which is great if you have a partnership-style business. It doesn’t cost much to form an LLC, if you pick a low-cost state. Virginia, where I live, is one.

You can pay an online site like BizFilings a fee – often less than $50 in addition to the state’s fees – to help you with very basic formation documents. Before you pay even that amount, however, check with your state to see if you can file the papers yourself.

Here are the five questions we suggested asking:

1. Where will you form the LLC?

2. Do you need an attorney?

3. What will the tax implications be?

4. Do you want to form as a sole proprietorship instead?

5. Are you partners ready to sign an agreement?




Growing Your Business ,

A New Way for Experts to Share Their Know-How

The digital world has opened up many new ways for freelancers to find work that they can do from home. One of the most interesting new trends is the rise of marketplaces where professionals can share their know-how. The experts typically answer questions from the public for a fee.

In our latest post for the AARP’s Life Reimagined site, Make Money as an Online Expert, we look at how pros, ranging from appliance repair specialists to career coaches, are bringing their knowledge to online communities such as Pearl and Maestro Market.

Often, these sites are not just a way to make money. One attorney told me how much he enjoyed being able to help average Americans who might not ordinarily be able to afford to hire a lawyer by the hour. He helps answer their questions for $10 to $25.

The number of such sites is still relatively small, but this will be an interesting space to watch in years to come.

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Path To A Successful Pitch

I’ve been a writer/editor for 25 years, since the day I walked up the stairs into the office of the diamondback at the University of Maryland. I’ve been freelancing for the past 12.

I’ve never, in all that time cold-pitched a story. That is, I have never sent a pitch into a magazine or newspaper. (Once, I sent in a letter to the editor of the Wilson Quarterly and the editor asked me to write a book review. That might count.)

I’ve always found work by first establishing a relationship and then finding projects of mutual interest – in other words, by selling myself first, and then finding the ideas.

So, here goes. I’m going to see if I can successfully pitch an idea that I’d really like to see in print. In other words, I’m going to sell the idea first — and then myself. Most of my work has been in business journalism, so this is a departure in that way, too.

I’ve been working on a novel on-and-off for about five years that’s based on a story in my family. My work on it is kicking into gear. So I’ve decided to try and freelance a story based on the book.

Normally, I don’t think it’s a good idea to share a pitch widely, because someone could rip off your idea. But in this case, the story is decidedly mine. And as we all know, ideas are great, but when it comes to writing or any kind of art or craft, the execution is almost the entire value.

I’ll follow my efforts here on 200k.

So, here’s my pitch. My first step was to ask for the advice of someone in my network on a target market. I thought of Ralph Eubanks, who just became the editor of the Virginia Quarterly Review. He suggested the Atlantic, either online or print, so that’s my first target. I’m going to first dig around for the name of an editor to whom to send it. (I checked mediabistro’s how to pitch section, but they don’t have the Atlantic).

The recovery

Almost 100 years ago, my great-grandfather laid down on the train tracks in Elizabeth, N.J. He left behind a girl in a coat with shiny buttons – my grandmother — to finish growing up without a father.

Roy Humphrey was one of a generation of forgotten men: His death was covered up in my family, called a heart attack or a fainting spell. I uncovered his story by researching old family scrapbooks and newspaper files. My hunt for the truth about his suicide and why he had killed himself led me to Lower Manhattan, where he had worked as a Barge Inspector, to old medical records in New York City, and to the scene of his suicide itself, in the heart of much-changed Elizabeth.

Eventually, I found his grave – with the name misspelled – at Arlington Cemetery.

During the Great Depression, the suicide rate spiked to more than 160 per million, the highest ever. Unemployment, though common, was a badge of dishonor that many men could not tolerate. “Every family had a story like that,” family friend in her 90s told me, in an interview in an old farmhouse in rural Virginia. “We never talked about them.”

The suicide rate also rose during the recent Great Recession, though not nearly as dramatically. Our culture has untied, to some extent, the link between work and a person’s value. This story will look at the relationship between work and a person’s stature in society.

This piece for the Atlantic will reclaim my great-grandfather’s story and examine the question of shame. I will interview experts on suicide, unemployment and the legacy of family secrets to add perspective.

Suicide remains one of the most despised acts. In the middle ages, suicides were buried at crossroads, with stakes through their hearts.

The essential attitude remains unchanged. In researching my story, I encountered sympathy for my great-grandfather’s act: “I’m sorry,” said the historian at the U.S. Customs Office, though I never knew my great-grandfather and could not have been grieving. She wasn’t sorry for the loss, but for the shame.

The end of my story is an act of remembrance: traveling to Arlington to honor my great-grandfather’s service in WWI, and advocating for a correction on his headstone.

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Your Declaration of Independence

Often when I write articles for business publications about self-employment, someone will post a comment pointing to the failure rate of small businesses, as evidence that people should stick with traditional jobs.

It’s always smart to keep your eyes wide open when you’re considering starting a business and to test the waters by, for instance, launching it on a part-time basis or small scale before quitting a well-paying job. At the same time, I think it’s time to say goodbye to the outdated notion that a nine-to-five position is the only route to economic stability. It’s an illusion to think that corporate jobs are secure, unless you’re in a field like tech where there are talent wars. Many Americans will have no choice but to become freelancers, temps and contractors if they want to work in the future, given that a growing number of big companies are transitioning to a contingent labor force.

Viewing this change as an opportunity, not a threat can help you position yourself to thrive. Many people have already said no to corporate careers and are building successful businesses instead. Newly released data from the U.S. Census Bureau shows a growing number of “nonemployer” firms with sales in the high six figures or in the millions. (I was interested to see that folks in arts and entertainment businesses were among those best represented in the category with revenues of $5 million or more). Revenue does not correspond to the profits or take-home pay of the owners, but it can be an important benchmark of success.

You can find out more about these firms in a recent post I wrote for Forbes called “The Rise of the Million-Dollar One-Person Business.” In response to comments on the site, I will be following up with some more specific data about the highest-revenue nonemployer businesses within particular industries in the next couple of weeks.

Not everyone has what it takes to build a thriving small business, but seeing these numbers underlined for me just how many people do have the right stuff. If you’ve done your homework, don’t let fear of failure keep you from pursuing your dream of going independent.




Making the Break, Uncategorized , , , , , , ,

Working With Demanding Clients

You’ve just arrived at your hotel on a long-awaited vacation, and an email message from a client shows up in your inbox. He’s working this weekend and wants to brainstorm about a project. You know it isn’t particularly urgent and wonder if he remembers the three conversations where you mentioned you’d be traveling with your family this week. Your mate is already giving you the look that means: You’re not going to ruin our vacation by taking business phone calls, are you?

What do you do?

It depends. With your typical corporate or small business client, you could simply write back saying that you’re traveling this week and would be happy to call them at 9 am the first morning you’re back in the office, or even on the Sunday before, if that’s better.

But that might not work if your client is a very high-profile celebrity or executive who expects white glove treatment and pays you a premium to provide it–when he wants it. If you hope to keep the account, your message might have to be something like: I am sorry. I am about to get on a charter boat where there won’t be much phone connectivity. I’ll be back around 5 pm. Could we talk at 5:30 or first thing tomorrow morning?

In “High-Profile Clients: Worth the Hand-Holding?” for the AARP’s Life Reimagined site, we talk with self-employed professionals who work with elite clients frequently to get their advice on how to handle situations like this. I loved their creative solutions to the sometimes unreasonable demands these clients can make.



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Sample Pay Rates For Freelance Writers

Here’s a nifty piece about freelancing by Noah Davis, sent to me by my friend and colleague Judy Messina. You can check out some of Judy’s work here.

He offers some good insights about the media business, including this nugget of truth from Ann Friedman.

The digital-first publications, even those with massive amounts of venture capital, have decent rationale for their pay rates. The print outfits, however…. “I actually think it would be possible for old-school print outlets to pay better if they wouldn’t over-assign or if they didn’t have super-fancy real estate in Midtown,” Friedman said. “The notion that media is both a struggling industry and a glamour profession is totally ridiculous. If you’re a struggling industry that’s worried about declining advertising revenues, fucking pack up, move to Brooklyn, and stop triple-assigning every issue.”

He also shared some of his freelance pay, which is illuminating both because it is all over the map and because some of it was not bad:

The Verge paid him $750 and $1,500

Penthouse paid $750 and $1500

ESPN’s Grantland paid him $250

SBNation’s Longform unit paid $1,750

and an airline magazine paid a little less than $1 a word.

He also ghostwrote a self-help guide for a magazine for $40 an hour and helped launch a web site for $10,000 and “a little bit of equity.”

Nice. This pretty much jives with my experience as a freelancer, except that as someone focused on the business world (and finance, to some extent), I have always been able to land some regular contracts. I think they’re crucial to making a living.



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Why Is Anyone Grousing About Women Breadwinners?

It’s hard to have missed the hoopla about the recent Pew Research Center survey that reported that 4 out of 10 families with children under 18 now depend on the income of women who are the sole or main breadwinners.

The survey prompted lamentations by male commentators on Fox about what this trend portends for society. After editor Erick Erickson said in a broadcast “that more women being the primary or sole breadwinners in families is harmful to raising children,” as he later put it in his blog, Fox host Megyn Kelly took him to task, pointing to a battery of research showing that the children of working mothers are doing just as well as children of at-home moms. If you’ve gotten tired of hearing complaints about working moms, take a moment to watch the video. It’ll give you a second wind.

What really surprises me is that women’s working is still such a loaded issue. In couples where women work, it’s usually because the family needs their income. According to a 2010  study by the Center for American Progress, in families with the highest income levels, only 33.5% had a wife where the wife earned as much or more than her husband. But that percentage rises in middle-income and lower-income families. In 43.5% of middle income families, there’s a wife who earns as much as or more than her husband. For those at the lowest income levels, the percentage is 69.7%.

The research found that only about one in three families now includes a full-time parent who does not have paid employment. In short, it’s a luxury that few can afford.

Given that this is the case, why are are wasting time debating whether or not it’s good for society if women with kids are breadwinners. The fact is that many are–and they’re doing it for a very good reason: To feed and house their families.

The real debate should be about how we, as a society, can rethink the workplace to reflect this trend. Women’s lives are different from men’s. Even if they are breadwinners, they typically tackle more housework, as Elizabeth pointed out. The lower-income and middle-income women who are most likely to be breadwinners often can’t afford the support systems that parents in the executive suite depend on, like reliable, in-home childcare professionals and house cleaning services.

Big employers don’t seem to want to pay attention to this. Perhaps that’s because it’s more profitable for them to try to get their workers to do the jobs of 1.5 to 2 people for the salary of one person–regardless of the personal price that workers with families pay when they are expected to work this way.

Freelancing can be a good alternative to this situation for some women, but if you’re the main breadwinner, it does require a cash cushion of about six months of savings to ramp up, given that clients don’t always pay on schedule. For those who don’t earn a high salary, it can be hard to save this much ahead of time.

Hopefully we’ll see the evolution of some new freelance marketplaces that offer workers the chance to earn quick, relatively steady payments without the strict schedule of a job. Freelancing would be a more realistic option for some if they knew they could get steady work every week–on their own schedule–and could expect their paycheck next Friday. I wrote about one company, Rev, that offers this model for translators and transcriptionists. Are there more out there? If you know of any others, please let us know by posting a comment.












A Measured Response To Lean In

I’ve had two good conversations lately with female friends of mine, both with careers. One of them is a high-powered young woman on the fast track, thinking about having children and wondering about the effect on her career. The other is a woman with two elementary age children, working on a graduate degree and looking to get back on a career track – though in a tempered way.

Our conversations boiled down to the same thing: What is rarely discussed in all the conversations about women leaning in or walking out is the home factor.

Yes, women hold themselves back, aren’t good at self-advocating, and underestimate their abilities. But even once you figure out that you’re just as good or better than the men you’re working with … that doesn’t matter so much if you are still the one folding laundry at midnight instead of reading a report. It’s the impossibility of competing with men while you’re holding your household together that leads so many women to opt out, become freelancers or momprenuers — or to take part-time jobs. For people who find happiness on those non-traditional paths, that’s great.

To the extent that those women would rather be winning in a supportive workplace, and to the companies that aren’t benefiting from their skills, this remains a problem.

In just about every household I know, the greater share of the family duties still falls on women. We could spend endless hours talking why, but my thought is simply that when you’re trying to get things done, you fall into the comfortable patterns. Women by training and temprament are usually the more skilled at child care; to teach men to do what we do would take time and energy, which we don’t have.

In any case, some recent research by Mandy O’Neill speaks to how the inequity in home responsibilities holds women back. O’Neill asked why female MBAs end up making less than male MBAs, even after they start out at the same level.

Eight years after graduation, in the 1995 survey — by which time the MBAs’ income ranged from $15,000 to $2 million per year — women had fallen behind men. To see why, O’Neill and O’Reilly dug deeper into the data, which revealed an interesting answer: The number of hours put in at their jobs made all the difference. Quite simply, eight years into their careers, women were working fewer hours than men on average, even when compared with men who had the same number of children.

The research doesn’t oversimplify. Some of the answer probably has to do with the housework factor. Some might have to do with the nature of the organizations – the intense competition of the corporate world might turn some women off. Perhaps, she suggests, it’s a combination of the two: as the number of people at each tier of the corporate hierarchy is winnowed, their capabilities are more and more the same. What starts to matter most, then, are factors such as the hours a person is willing to put in and the willingness to relocate.

The Lifestyle, Uncategorized , , ,

Create a Killer Blogging Program

Lately, I’ve been getting a lot of calls from people who want help attracting visitors to their companies’ websites. Can I write a blog post or two every week for them?

Plans to publish a gigantic list of blog posts like this always give me pause.

Often, the folks who call have heard from a search engine optimization expert that they need to publish frequently to generate web traffic. But generally, I’ve learned, putting up a bunch of quickie posts isn’t the best way to do it. Frequent publishing may raise your Google ranking and pull in visitors–but if what you’re writing isn’t inviting (Read: entertaining and/or useful), it won’t be “sticky.” It may ultimately repel the types of visitors you’re trying to attract in the longer term. If what you’re really after is higher web traffic, it’s often smarter to invest in a web-based advertising campaign.

Here are some thoughts that I hope will be helpful to organizations that want to add a blog — and the writers who assist them. For some context, I am basing this on my past experience running a small business website with millions of page views a month and in working with private clients on blogs as a freelancer.

It makes sense to blog only if you’re trying to start a real conversation with your target audience–whether that means colleagues or potential customers. This takes time and effort, even if you hire a professional writer to help you. It may be simple to publish on today’s blogging platforms, but it is not easy to conceive and write high quality blog posts that really mean something to readers. Delivering quality, not quantity — in both your thoughts and your writing — is what matters.

Have you ever gotten cornered at a party by someone who talks at you nonstop about anything that pops into his head, without caring who you are, how you’re reacting or what you may have to say? Your instinct, of course, will be to flee. How you felt in that situation is similar to what visitors to your site will feel if you bombard them with so-so blog posts.

Contrast that to running into an intriguing new acquaintance who brings up something really interesting or funny, asks you about yourself and really listens to your answers. He  draws you into a conversation that changes the way you feel about something important–to the point that you’re still thinking about the conversation a month later. If you hear he’s coming to the next party, you’ll make an effort to show up and hang out with him. When you’re blogging, you want this party guest to be your model.

Before you embark on a blogging program, think about what you have to say that will be meaningful or useful to the people you want to reach. In what areas are you an expert? What topics are you passionate about as a professional? These are good sources of material for the blog of a company or organization. While every blog should be fun to read, keep in mind that if people want to read sports commentary or political ideas, they’re generally going to look to their favorite news sites, not the blog of, say, a tech company CEO.

To find the right writer to help you, look for someone who will help you brainstorm topics, focus your message and come up with a publishing schedule based on the best ideas you have to express. It could be that instead of two fast blog posts a week, you’d be better off with a great monthly blog that reflects your best ideas as a leader. In other cases, you may need to blog more frequently. Say you’re planning a giant conference and you’re adding great new speakers every couple of days. You might want to publish your blog each time you have a new speaker to announce. The best writers will be willing to help you match your publishing schedule to your ultimate goal, even if that means less paid work for themselves.

Don’t waste money hiring writers to deliver a series of blog posts without your involvement, based on news or information they’ve found on the web. Why bother posting generic material like this? Unless someone in your organization is willing to lend insight and expertise to the posts, this type of writing won’t help you make meaningful connections with anyone you’re trying to reach. It looks canned and insincere and, in the worst cases I’ve seen, unprofessional.

A great writing partner for your blog won’t behave like a dictation service. The relationship will be collaborative. Look for a writer who listens well to your ideas for a blog post but has the backbone to push back when you need it. The best writers will question you if your ideas aren’t clear or your words might backfire and hurt your reputation. They’ll lean on you to deliver quality–to the point that you may occasionally want to scream at them–because they will want your work to shine as much as you do. They’ll be willing to revise and polish. This type of help isn’t cheap. But you’re better off writing one post that really means something and goes viral than 100 posts that only two people read.



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Protect Yourself from Nonpaying Clients

There’s nothing more draining than chasing down payments for projects you delivered on time, months ago. The best way to avoiding doing so is vetting clients carefully from the get-go, to make sure they can actually pay you. But, as experienced freelancers know, this is more of an art than a science.

In “How to Avoid Deadbeat Clients and Get Troubled Ones to Pay,” our most recent post for the AARP’s Work Reimagined site, we offer tips from seasoned solo professionals and experts on how to minimize the time you spend acting as a collection agency.

It’s hard to turn down work in the feast-or-famine world of freelancing–or to operate from a position of mistrust. When in doubt about a client, I have a suggestion: Either ask for a deposit up front or set up an account on one of the major freelancer’s sites where clients must put money to pay you in escrow prior to the job. (Elance is one I’m familiar with, but there are several other reputable ones.) Have the client hire you through one of these sites. These middlemen will typically take a cut in your earnings, but you may find you have more peace of mind if you have some up-front assurance that you’ll get paid.

While the greater exposure we have to distant prospects on the web can be a blessing in some cases, it means we need to be more vigilant, too. Recently, I had an experience where a very small potential client who found me online lined me up for a project. The prospect asked for my federal tax ID number on a W-9 form, which I provided. Some of the other agreements this prospect then asked me to sign were very poorly written and started raising questions in my mind. When I was later asked if I wanted to receive future payments by direct deposit (and asked for my bank account information), I said I’d prefer to receive a check in the mail. The job suddenly evaporated. This may have had nothing to do with my refusal to provide a bank account number, but I had to wonder if I was being targeted in a scam. Now I regret having provided my tax ID and hope I have not become entangled with someone who plans to misuse it.

I would never back away from working with clients I don’t know. However, I’m now considering setting up an account on one of the freelance sites simply to avoid providing my tax ID until I’ve built a working relationship with a client who hasn’t been referred by someone I know. These sites typically act as the employer, so they’re the ones who receive your personal information. While you do sacrifice some earnings by involving a middleman, you are often free to move off of these sites to work with a client privately after a set period, such as a year. That should be long enough to know if a client is on the up and up.




Growing Your Business, Your Back Office , , ,