The Freelancers' Show 118 - Preparing For Freelancing: Finding a Niche

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The panelists continue their "Preparing For Freelancing" series and discuss finding a niche.

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REUVEN: I actually had a very, very nice dinner with my adviser last night. He took me out, it was great, everything was pleasant, except for the whole –. ERIC: But then the awkward kiss at the doorstep? REUVEN: [Laughs] [Would you like to join a conversation with the Freelancers’ Show panelists and their guests? Wanna support the show? We have a forum that allows you to join the conversation and support the show at the same time. Sign up at freelancersshow.com/forum] CHUCK: Hey everybody and welcome to the Freelancers’ Show. This week on our panel we have Eric Davis. ERIC: Hello. CHUCK: Reuven Lerner. REUVEN: Hey everyone. CHUCK: I'm Charles Max Wood from DevChat.tv – oh, I forgot! It’s Dr. Reuven Lerner. REUVEN: There. That. That’s why I took my dissertation [crosstalk] podcast. [Chuckles] CHUCK: Do you feel better now? REUVEN: Ugh – how long do we have? An hour? [Laughter] CHUCK: Curtis isn’t here because he’s recuperating from riding halfway across the continent. This week we’re going to be talking about finding a niche.  We know what your niche is, it’s writing dissertations. REUVEN: [Laughs] Not recommended for people who want a profitable consulting practice. CHUCK: Have you guys focused on niches in the past? I know Eric has. I can’t think of an instance where you said that you have, Reuven. REUVEN: I'd say that my niche is mostly – and this is obviously a wide thing – is web application development. I'm usually with Ruby or Python, but that’s a really, wide, wide [inaudible] and certainly, I haven't focused on one particular kind of business sector, one particular kind of client. Although I'm starting to think that that’ll probably be a wise thing to do. CHUCK: What about you, Eric? ERIC: Yeah. For a few years, I was focused on Redmine and ChiliProject and that stuff, and it got to a point where that’s all I did. I actually turned down regular, vanilla, Ruby on Rails work just because I was more efficient and I felt like I created more value working in Redmine and ChiliProject. Since then I've kinda left that and I'm focusing a lot on doing email marketing software and integrations and stuff like that, so it’s not so much a focus on one open source project or one technology, but more of one activity, I guess, you would say. REUVEN: I'd say just in the [inaudible] I’ll be finishing my dissertation, given that I was focusing on collaboration – online collaboration – I'd say that’s probably like my next step to start saying, “Okay, I'm really interested in this particular area.” But again, that's like a subset of web applications; it’s not a particular type of business or organization that I'm looking to work with. CHUCK: Yeah, but – and this is something we can get into. I think there are different kinds of niches. ERIC: Yeah. CHUCK: For example, you could focus on a particular industry, and that’s the first example you were talking about. You were talking about doctors and dentists as one that I've considered entrepreneurs and startups is another one I've considered where these are kind of verticals or areas of business. But you can also focus on specific types of problems; you can focus on – I know Eric’s been working on email marketing stuff – or you could focus on solving problems with integrating with Facebook. I think Redmine qualifies as this kind of a niche. Are there other types of niches other than those two that you can think of if you used to classify clients? REUVEN: Yeah, I think that's a good point. ERIC: [Crosstalk] it’s like a horizontal and vertical. Vertical is where you're sticking in one industry, and so you might do a bunch of different things in that industry, like you do everything for a dentist – you'd pull their website, you set up their servers, you set up their backups, all that stuff – and horizontal is where you do one specific service but you work with a variety of companies. In my case, I do email marketing and I'm focused on software companies, but I’ll help anyone else that has similar problems. Another kind of way is actually combining them both, so you do the horizontal and vertical. If you can find a market that’s big enough and it’s something that’s interesting enough, that’s like a niche of a niche, which can actually be pretty good. CHUCK: So what advantages have you guys seen from focusing on a niche? REUVEN: One of the things we discussed in a previous episode of the podcast is the importance of being able to say no, that if you have all of these different people coming to you, it’s important to quickly filter out the people and the projects that are not appropriate. By focusing on a niche, that definitely helps winnow down quickly. But I think a bigger reason is that it allows you to develop your expertise in one particular area. Just yesterday, I was talking to someone, and he had this project he wants to do. It sounded like I could definitely help him with his project, and he said, “Well, we wanna do it in PHP.” I said to him, “Listen, I could, but my business interests right now are in improving the stuff that I do with already a large set of languages. There are three languages, typically Ruby or Python or JavaScript; to extend that to PHP, I just don’t see this as aligning with my interests, even if it’s better for yours.” I want to become sort of a bigger fish in a smaller pond, rather than be in all the ponds, to stretch that analogy to its limits. CHUCK: Yeah, that makes sense. One other advantage that I see is just it’s easier to focus your marketing effort, right? Instead of saying, “I do web development,” you go out and you say, “I build Facebook apps” or “I work on Redmine or ChiliProject” or whatever, and so people who are looking for that specific skill set, their searches will line up with your marketing because you're not marketing to everybody; you're marketing to people who have that particular need. ERIC: Right, it’s about positioning yourself. You draw a little area in the sand – this is what I am, this is what I do, and that’s completely different than if you can actually do other things, if you could do –. This one keeps coming to my head because they did a good job, but there's a group that does performance stuff for Ruby on Rails applications. If you have a badly-performing application, they’ll tune it up and make it perform well. They can probably do new Ruby on Rails stuff; they could probably work in Redmine; they can probably do a lot of other Rails-type things, but they're known for their performance stuff, and so that’s how they attract customers. I don’t know their business that much, but for me, I would attract people that wanted one thing, and then once I had discovered that I could do a bunch of other things too, that kinda kept them sticking around. Once the first project was done, and my main skill wasn’t needed as much, I was actually able to keep them as a client because I had these other services that I knew but I didn’t actually have any market. CHUCK: Yeah, one other thing that I've seen is it’s easier to get referrals, in some ways, at least. I've done [inaudible] work for a bunch of entrepreneurs and getting referrals from them was hard because I'd be like, “Well do you know anybody who needs my help with building web applications” and a lot of times, it just wasn’t direct. It wasn’t, “Oh well, I have this friend that’s building web applications” because you're not building a web application; he’s building solution x for market y, and so they just don’t make that mental connection. But with something like Redmine or ChiliProject, the question becomes, “Do you know anybody who needs customizations for Redmine or ChiliProject?” and if they know somebody, they just make that mental connection and it’s really easy to do because it’s a specific problem that they may have been talking to somebody else about. REUVEN: But also in your example Chuck, there's a big difference between being able to help people with their business – I mean, at least in the perception, in the marketing, I think, being able to say, “I can use web technologies to improve your business and solve your problems” to “I can customize Redmine.” Customizing Redmine is a specific thing, but it’s also something that – the people who are going to know about that are already technical, so they're going to understand it a lot more, and they are going to be able to draw the line and say, “Oh, well if you're a Rails developer and you’ve done some work in Redmine, the odds are pretty good you could help me with this, or you'll just need to read such and such API docs” – not that I'm trying to belittle the amount of work that’s involved there – whereas if you're trying to talk to businesses, you need to be drawing those lines and saying, “If you have a problem, I can solve them this technical way. Nevermind what the language is; that’s sort of secondary.” CHUCK: Yeah. I guess in that case then, something like Facebook apps or integrations with Twitter would be a better example where they know that there's technology there to do it, and they know that they need somebody like you to do it, but they don’t necessarily – they're not technical enough to understand all the details and go into it. REUVEN: I think that’s a great analogy, yeah. CHUCK: And so they're talking to their other marketing buddies and their marketing friends are saying, “Well, it might be fun to get this app on Facebook, or get this integration into Twitter. It would help us with our marketing effort,” so it makes the connection and it goes to a very specific problem that they have, and they can give them a specific solution, namely, hire you. REUVEN: Yeah, absolutely. Maybe you guys know more about this, you have more experience, but it all seems to me that marketing to technical people is easier. For me, at least, as a technical person. If I can say I work on such and such technologies, then they see that fit right away, but it’s much harder both for me to explain myself and me to market myself to non-technical folks to draw those lines – unless they are, as you say, saying they're looking for something specific that’s technically on Facebook, Twitter, that sort of integration. CHUCK: Yeah, I found that’s the same thing. I have four podcasts, and three of them are directly aimed at technical people and the other one – this one – we talk about business but I still feel like with the panel and the guests that we get and things, in a lot of ways, is also geared that way. Talking to business people isn’t necessarily hard for me, but I don’t naturally gravitate to the issues and topics that they care about, unless they're things that I'm dealing with myself. And so if they're in a bigger company or in a different situation than I am, I don’t always gravitate to those problems. REUVEN: Mm-hm. CHUCK: Do you have any thoughts on that, Eric? ERIC: Not really. It’s like, what are your strengths? I can talk about business problems, but I'm good with someone who’s semi-technical, just because then I can actually draw on technical examples, or use those in my explanations. But it depends on what you're doing; if your niche is a technical product like [inaudible] Redmine, or if it’s you build whatever SAS apps for the medical industry, then most of the time you're going to be talking to someone technical, maybe even at the CTO level, but still a bit of technical stuff. But if your niche is in an actual industry and not necessarily technology, and you have the ability to kind of pick and choose technology, then I think you're able to stay more in the business realm with your discussions, and just use whatever technology is the best fit. CHUCK: Yeah, that makes sense. This is something that I've struggled with often on for a while, and that is how do you choose a niche? How do you decide what you're going to focus on? Do you just kind of accident into it? “Gee, I'm doing a lot of work on Redmine, so I'm just going to keep doing work on Redmine.” ERIC: Yeah, I mean, you can; that’s what happened with me. Or you can do research, kind of figure out, “Okay, of all the interests I have, which one’s the best commercial, viable market?” Or you can just jump around and try something, see if it works and go somewhere else. I don’t know – I haven't found a really solid way of doing it other than looking at your interests. Yeah, you can just happen to cross something, you can just look at what projects you're getting and which ones interest you. For me, I had a bunch of Redmine projects get referred to me before even I actually said, “I do Redmine stuff.” CHUCK: I think that’s a good place to start, is just what are you interested in; I find that I do that a lot. But when I fail to properly pick a niche, usually it’s because I don’t give it a long enough try, I think. Basically, I’ll try and find work in that niche for a month or two, and then I’ll see some new shiny, and I’ll say, “Oh well, I haven't put a ton of effort into this yet. I'm just a month in,” so then I’ll switch. Or I'm not sure if the market is really strong enough to support me full-time and so I’ll back off and try something else. Is there a good way to evaluate the market just to know if it’s worth continuing to pursue? REUVEN: Well, you can sort of look around and see – even on job boards and just from what people are talking about. For instance, it’s been clear to me that I want – I mean, the main stuff I've been doing over the last few years has been Python, and Ruby, and a lot of Postgres as well, both in terms of projects and in terms of instruction. I've been very fortunate that there is a complete cohesion between what was interesting to me, and what was interesting and useful for my projects, and what the market was interested in. But already over the last year, I've said, “You know, I really need to beef up my creds in certain new things; what should I be looking in?” The two things that looked really interesting to me were Closure and ember.js. I just decided that Closure is super cool and I have a warm spot in my heart for all things Lisp-related, but I just don’t think that the market is large enough to justify me going whole hog into that. [Inaudible] I'm going to try to spend more time on ember.js just because I sensed that the market is moving in that direction, but I could be wrong. But I definitely think that it takes more than a month or two. I'm expecting this could take me four to six months to really get the expertise I wanna need, and then for me to be able to find work in that, and then I could still be wrong. ERIC: Yeah, I mean it takes a while because depending on where you're coming at. If you're brand new, or if [inaudible] I basically tossed all over the stuff I did and started over, it takes a long time to kinda get all your marketing and position and all that stuff – either you started back up or switched over. I would think jumping from one niche to another after a month is really, really early. If you did it six months or maybe a year, then you probably have enough data. People just don’t know that that’s what you do, and people – your customers – they aren’t listening all the time, and so you might switch, but they might have missed the “Hey, I switched from Python to ember.js.” If they missed that, they might still be coming to you for Python stuff. But over six months to a year, there's a good chance that they might have heard it, or you might have become known, or done something else. Even if you're actually doing more outbound marketing like actually reaching out to people, you might have reached out to your network enough that actually they know you for that now. REUVEN: I should also point out that, there are people – just to continue the example I gave from before – there are definitely people who are doing full-time Closure development. In some ways, choosing a really small niche makes it even easier for you to become an expert and become in demand there, but it might also require a bit more patience in terms of finding more projects in it. CHUCK: Yeah, I think that really comes down to a lot of the networking and putting yourself out there and becoming a resource for the community, building your platform so that people are actually coming to realize that you are there. I think there are a lot of things that you can do to help that along, but you're definitely right. I mean, it’s easier to become a big deal in a smaller pond, or in a smaller market. Are there certain things that are too broad? I mean, are there certain specializations, I guess, that are too broad? For example, Ruby on Rails – is that too broad? Do you need to niche down further? ERIC: It used to be fine. I got started in Rails in 2005, and if you said you're a Rails developer like you, that was perfect, you were snatched up, and in fact when I was doing freelancing in 2007, that was fine. But since then, the Rails has boomed a lot; there's a lot more people, and so like everyone and their uncles says they know Rails and does Rails. So now, at this point in time, you need something more. I could say I've been doing Rails for a long time, so I have a lot of experience – that’s one way to niche in where I'm a bit different. I'm not like the other – I don’t know how many thousand other Rails developers there are – or you [inaudible] you can niche into a certain software thing, or you do Rails performance or something. It’s hard to really give a quantitative measure though because it depends on the demand side – if no one’s hiring for Erlang stuff, you could say that you do Erlang but it’s still not good enough, so you have to look at it from all angles. What I found is, actually, try a niche; try for a couple of months, see if you can get clients, and then if you're not getting enough, you're not getting noticed, then maybe you need to niche down a little bit. CHUCK: So not niche up? ERIC: Niche down –. CHUCK: I mean, back up into the next higher level and find another niche? ERIC: I mean, you can, but I think if you're not finding clients, you're not specific enough or you're not targeting someone’s pain enough, and so you're just like another dozen people, and so you're not getting clients that way. You'd wanna make it a tighter niche; maybe you'd do Rails for SAS companies that have over $50 million in monthly revenue or something like that where it’s very tight and you can actually build more marketing for that and become known for that area. Or you can play a bandit and go somewhere else. The other thing you can do is look for market data and see how many SAS companies have $50 million in sales and go at it from that way. CHUCK: These are a good place to get that kind of information? ERIC: You can get a lot of it online, like census data or – I've been using Hoovers quite a bit. You can do lists of people, and they get a lot of public data sources and private data sources, and some of the data’s kind of crappy, but it can at least show you market sizes like there's this many SAS companies in Oregon. I've been looking that up quite a bit recently, and if you compare it to how many in California, it’s a completely different scale. If I did specialize in SAS, I probably wouldn’t do local and just say, “I only wanna work with SAS companies in the Portland, Oregon area” because there are so few, but if I was in California I could say, “Well, I wanna work with SAS companies in California, like maybe in the San Francisco Bay Area, and that might be enough to sustain me.” I guess another aspect like, it depends on your service, too. If your service and your billing rate is really high-dollar, you don’t need a lot of actual clients. If you maybe got one or two clients a month, that might be all you need; you don’t need a bigger market, you don’t need a big niche. But if you're doing, say, just a generic WordPress installer or something where it’s not a high-value service, not a high-dollar service, then you're probably going to need a larger pool; you're going to need a larger niche. CHUCK: Yeah, that makes sense. REUVEN: Actually years ago – I guess it’s probably more than a decade ago – when I was putting up the version that I then had in my website, I explicitly rejected this whole idea of entering a niche or being a specialist on a certain kind of technology. These other web development firms, they have one technology that they really specialize in and we totally don’t do that. We believe in finding the right technology for you. At the time, I thought, “Oh, this is so great, because I'm not going to try and dictate things to people” and I realize, this was just driving me nuts, because everyone would call me and say, “Do you do x?” and I'd say, “Oh, yeah. We definitely do x.” or “we can learn it, we can work on it” and it failed to really help me build up a specialty in anything, or to be well-known for anything. And so in the last few years, even though I've been specializing on a few technologies – just that explicit reduction, just that explicit statement has definitely, I would say, improved the type of clients that I get. People call me up and say, “We know that you do Ruby on Rails; can you help us with such and such?” and it already focuses the conversation, which I found to be definitely helpful. ERIC: Yeah, and you can make multi-offerings like that work because there might be some places that have – actually it’s the prime example - some places have a PHP application that they're in the process of importing to Rails. Well, you can’t just get a PHP developer, and you can’t just get a Rails developer, but if you know PHP and Rails, you're an ideal fit for that. So it is kind of a niche of where the niche is of a company that has a mix of technologies they are using, and it could also be where you have this broad offering of we know we can learn everything, and you bring us in to do maintenance stuff. If you have weird servers in your back office that haven't been touched in 20 years, we have someone that knows or can actually learn the programming language just for that, and in that case, your value is the speed of learning and kind of the variety of learnings that you can do. CHUCK: Yeah, I really like that. And there are different, within web development stack at least, there are different technologies, whether it’s amber.js on the frontend, or Ruby on Rails on the backend, or you have the different database layers and you could use different database layers for different things. In other industries, there are a lot of things that you can do. I mean, if you're a photographer, you can focus on a particular type of photography, or different types of shots. You can do corporate headshots for entrepreneurs or businesses, or you can do family portraits. You can do all kinds of different things, and maybe they come back to you with the other kinds of business later on that you can also do, but by focusing there, you get all these benefits that we’re talking about. ERIC: Yeah, and if you can pick complementary stuff, that’s best. For mine, my main service is custom Ruby on Rails code for email marketing. I'd pitch it as email marketing, but I'm using Ruby, but I also know enough copywriting that I could write the copy in the emails and I can then hook up the conversion tracking through either off the shelf or custom software; I know how email servers send and all that. So all of these different things kinda combine together so that someone can come to me with a problem of “our email marketing’s not working” or “we need it more integrated” or just anything around that area and I can pick and choose from different skills and different technologies that I know to actually build – Okay, here’s the custom solution you need to improve your revenue through email marketing by whatever, 20%, 30%. CHUCK: Yeah, absolutely. So having a niche – you mentioned something about not being close enough to the pain that they have. So if you're building a niche around like that particular problem, or pain that people have, how do you identify that? Do you just go and talk to folks, or are there other ways of doing that? How do you take that and turn that into a niche? ERIC: That’s the best way – if you can talk to people or – it’s a little better if you can kind of read what they're doing. It’s like the psychology experiments where if people know that they're being watched or measured, they act differently than they would actually naturally, and so if you're actually sitting down interviewing someone, they're going to stress different points than if you were just watching them from afar or whatever. Finding out what problems people have – actually, not people but I actually look at businesses, not consumers – if I know what problems they have, find out what's either costing them time, money, resources like people, and kind of figure out, “Okay, here’s the problem they have. Using the skills I have, what can I do to solve it or make it less of a problem?” You don’t have to actually completely solve a problem, but you can make it less painful for them. Do that enough and talk to enough people and you can kinda see some patterns. Most businesses are 99% identical – it’s the 1% that’s different that makes them think they're unique, so if your service works for the 99%, then you don’t really need to do a lot of customization, at least as far as your marketing’s concerned. CHUCK: Yeah, that makes sense. REUVEN: I would say, I've sort of bounced over the years between choosing technologies just based on my own interests for clients who don’t care about what technology I'm using, and then if that’s successful, then I go and look for other people who need help with that technology because now I've accumulated expertise in it. Those of us who are technical – those of us who are programmers – I mean, if you're doing a good job at least, then you're always learning new stuff and you are probably –. The things that you think of as old hat from a year or two ago, those are still going to be cutting edge for most businesses, and so if you’ve used that first year or two the things that have come out to become an expert, then you're going to find that there are a lot more people two or three years down the road who need help, and who can benefit from your expertise. And so by being a little ahead of the curve, and using those things will have the curve on your own project, you can then sort of beat everyone else to market and then become the people that others will turn to. CHUCK: Yeah, absolutely. ERIC: And on the other side too, even if the fad or the event or whatever has already passed and it’s more mature now, you can also look at it on the maintenance side or on the end, like you know the stuff and you're willing to stick around and maintain it for a client, and that could be hugely valuable, because a lot of people that jump to a new technology, they jump and abandon all the other stuff. I've picked up quite a few projects because [inaudible] the Ruby stuff, because that’s when node.js came out and JavaScript got popular and a whole bunch of people jumped over there. That was the new thing to do, and so all of a sudden there's this big [inaudible] in the supply of Ruby developers, or at least Ruby developers who were willing to work with clients – that’s another thing. If you know and can maintain stuff pretty correctly, that’s very lucrative, and especially if you're a solo freelancer, you can get one or two clients with that and that's like, they’ll be long-term with you and you don’t have to worry about actually doing a ton of marketing because it’s so stable. REUVEN: Absolutely. I think I might have mentioned this in the podcast in the past, but it’s been pointed out to me that maintenance of existing COBOL code – and I don’t think there are too many people learning COBOL nowadays – but what do you know? It’s a billion-dollar industry now, just maintaining that existing software, partly because there's so much without them, partly because most of the people who know COBOL have been retiring. And so if you're willing to do something that’s a little less sexy but there's a big business need for it, you go for it; that can be a fantastic business opportunity. CHUCK: Yeah. So we were talking about niching into something that the market is kind of shrunk on, and so since people have moved out of it, it’s a good niche to be in because there's not as much competition. I'm curious though, say, four or five years ago, six years ago, Ruby on Rails was pretty new and so you can break into that industry and grow up with it. Is there a point at which you want to start looking at moving out of the niche, or niching down further within that niche that you previously had, because the market has grown so much to where there now is a lot of competition and it’s harder to stand out? ERIC: Possibly. I can talk about how I left Redmine, because I was there for – let’s see – seven, five years, maybe six years [inaudible] full-time and the market was still on kind of the growth phase. I was one of the first plugin developers, and by the time I left, there is a lot more of them, but I was still the person who’s putting out the most volume. For me, I just got bored. The problems that were in that niche that haven't been solved were not interesting to me, or it’s actually the same as the other problem with one thing changed. For me, I felt that a stain in that kind of niche and continuing to do that work was actually going to be holding me back both career-wise, knowledge-wise, that sort of things. I was actually behind the curve so much that I was feeling kinda left behind, and because I've always been a little bit on the early adopter side of some technology, it was an imbalance between how I felt and the work I was doing. And so it wasn’t quite resentment, but it was – I wasn’t enjoying it. I wasn’t getting stuff out of it that I got out of it in the early days, and so that’s one of the big reasons why I actually kind of left it. Basically, I have a blog post talking about; it’s like I want to move on for other opportunities. A little bit after I left that, I worked for kind of a startup tech thing on their project that we’re using a lot more modern technology, a lot more cutting edge, and I felt – not in power, but I felt a lot better about what I knew and my knowledge working with them because it fit me better. And so that’s something that you have to watch first, especially if you're doing the maintenance stuff. You can't just be you're cranking on widgets day in and day out. For some people that might be fine and that might be good especially if you have an outside startup or hobby or whatever, but I know for myself, because I knew how I worked, how I functioned – it just wasn’t good enough. CHUCK: Interesting. So you may move on [inaudible] or move into a different niche for different reasons, not necessarily because the niche is bad, but because it’s no longer a good fit for you. ERIC: Right. And I mean, there were more competitors, but the thing is, I was there so early on, I could factually say that I – with the exception of the guy who created Redmine – I'd been working on Redmine plugins longer than anyone else in the world, and I still have over a hundred open source plugins, which is – that just doors even the number 2 person. So even if a bunch of competitors came in, I could still say, “I have all this work, I have all this knowledge” and by that time I have actually designed a lot of the systems that I was using. Even if you don’t get in early, if you can produce a large body of work, you can have that sort of thing too. You can be the person maintaining the largest COBOL systems in the world, and that’s a benefit even if competitors are coming in or whatever. It’s still going to stay that way. CHUCK: Very true. REUVEN: I was in the Perl niche for a long time – I would say, more than a decade. I really tried to stay attuned to news in open source world, and it just sort of seemed to me, that things were starting to fall apart to some degree in Perl. Not overnight, but to some degree, little by little. I would still be getting plenty of calls for work in Perl, but I decided, you know, if I'm starting to see this now – as I said before – I think I'm going to see changes in my business in the next two to three years, so it’s time for me to look into specializing in other languages, and that’s why I moved more into Python and more into Ruby. And indeed, a number of years later, just because of the way growth was being managed with the language and then the community, we didn’t see growth in the other things. It’s definitely worth paying attention to, especially if you're using open source technologies, so what's going on and trying to get a feel for what the community is doing, so that you can just enough ahead of the curve for your potential clients. ERIC: I think that's actually important, is you wanna be ahead before your clients, not necessarily your peers. Your clients and the people you wanna work with might actually be a couple of years behind whatever that your peers are at. You jump into something that’s cutting edge for developers like – Swift just came out; it’s Apple’s new programming language – clients might not be moving to that for another five years. You can get in now and learn it, but you're going to be having to wait for the clients to catch up. But if you keep doing objective-C, which is the other Apple programming language, you can do that for three or four more years, pick up a little bit of Swiss stuff and then once the client starts looking at Swift, you're like, “Oh yeah, I know Swift already. I've been working on it on little projects here and there.” REUVEN: Yeah, when I go into a company to do Python training, for instance, those are the people who are learning Python, and by definition, they're new to Python, and most of them have been programming since C or C++ or C# for years, sometimes it’s been Java for many years, and they are shocked to discover that Python is older than Java C#. They're like, what do you mean this programming language as been around for 20 years? Just because it’s new to them and they did the [inaudible], it doesn’t mean that there's no business opportunity there. Eric, you're totally right. It’s all a matter of you relative to your clients, not you relative to the age of the technology. CHUCK: So, really quickly – and I know I asked about how to pick a niche before, but let’s say that you were coming into programming, brand new. You had a little bit of experience doing programming but nothing specific to a particular niche of vertical. What would you do to figure out what niche you wanted to be in? ERIC: I guess you mean that this person’s already freelancing, or they're full-time, or how’s that? That’s a bit more history. CHUCK: Good question. Let’s say freelance, and then maybe I’ll ask what's different or why it matters. ERIC: Okay. If they just jumped into freelancing, what I would do is look at what they’ve done either in previous jobs or if they had schooling or whatever. I don’t know very many programmers that just all of a sudden wake up one day and got started with programming. There's typically a reason why, like maybe they're interested in games or they’ve done some website stuff here and there, and so there's something that sparked their interest that kind of brought them along the path to programming; for me, it was actually games and building websites around gaming stuff. That would be the first thing I'd do because I think you need to have a niche that you enjoy working in, otherwise, you're going to leave or be very dissatisfied with it. Look at your interests there; maybe you have some hobbies or whatever; if you do some kind of sport or whatever – that might be a niche as far as like an industry that you can target or whatever. Other things to look at is do you have family members? Do you have a family member that’s a lawyer? I know, Chuck, your dad’s a dentist, so that might be something. Based on that, try to talk to people. Try to talk to family members, or friends, or friends of friends that are kind of in a niche you're thinking about; talk to them, see what kinds of problems they have, see what challenges they have in their business, in day-to-day. If there's stuff that interest you and you wanna take your computer to them and show them how they can actually do this thing a lot better, like quit copying and pasting stuff – just export it into Excel, and do this and do that – that can show you that you have a bit of passion around at least those problems, and that might be a good starting niche to start looking at. And then use the techniques we talked about: figure out if it’s large enough, if you need to go smaller or whatever. I think you gotta get in and get your hands dirty a little bit and kinda see the research you're looking at, the people you talk to – is that actually realistic for the niche, or are you actually seeing how it’s going to be, or is this just kind of a first impression? REUVEN: I remember there are also different sources of services that you can provide if you're just starting off. In many ways, the easiest way is to say, “Well, I know technology x; I’ll just go be a contract programmer at a company using technology x. Instead of them hiring a full-timer, they’ll just hire me.” Maybe over time, maybe you can become more of an expert; maybe you can become more of a high-level consultant specializing in certain kinds of solutions, but that'll also give you time to figure out if you're in these companies. If you're in a variety of companies in particular, it’s only going to give you lots of perspective on what people are interested in and what they're doing. I feel like I have a much, much better sense of what technologies and languages are being used over the last few years, just doing all the training and talking to people during lunch and finding out what they're using and what they're doing than I ever would have otherwise. ERIC: Yeah, that’s a good point. I recommended that to one person already where they had technical skills, technical experience, but they weren’t sure what area, what industry they want to focus on. We talked back and forth and ended up – they decided they're going to kind of subcontract under other freelancers and get exposure to all different clients, a lot of different industries, and then from there, figure out where they have a passion or where they have an interest. CHUCK: You have to say that's one question that I get asked quite a bit, and that is, “I don’t have a lot of experience so what do I do?” Because then they can niche down, sure, but they may not have experience or some way of showing off that they are capable of whatever it is that you decided that they wanna do. Do you start just kinda doing free – or in software, you can do open source work in that area to show off that you can actually solve problems in that niche? Do you find a company that works in that niche and make that go first, or –? ERIC: Both of them. I mean, it’s kind of the chicken and the egg. The ‘you don’t have experience, but you need to get clients’ and they need proof or something to kind of make them feel better that you know what you're doing. If you can do example, for programmers, open source is a great one or if you're a designer or copywriter, or you can make up a fake client – like a case study client and make sure it’s disclosed that this is not a real client – and write copy about how you would sell fitness product or whatever, if that’s [inaudible] fitness industry, and kind of show that so that you can take it to clients and be like, “Look, see, I know how to write in this; I know how to do this sort of thing” and get enough trust built so they kind of are your first or your second client. And then as you finish those contracts, [inaudible] you get testimonials from them – maybe you do an actual case study on them; you put stuff in your portfolio, and then that kind of bootstraps you into the next client. The idea is each time you successfully finish a client, you get more proof that you know what you're doing for this niche, and that makes selling the next client even easier. But the problem is you gotta bootstrap; you gotta have something that starts the process. It could be free work, it could be working, how to really cut rate for a family member or whatever. You're probably going to have to take jobs that you wouldn’t be taking in five years just to get the ball rolling, because once you get momentum going, then it becomes a lot easier. I mean, when I left the Redmine stuff, I guessed that I had a hundred plugins, which most of them clients paid me to build. Ahead of that, I had a bunch of open source work around it, and I still – this is a couple of years later – I still get a couple of leads asking for Redmine work. I got the ball rolling and the ball kept rolling even after I walked away from it, I went in a completely different area, but that kind of getting that thing started and moving took a bit of time. CHUCK: Awesome, very nice. Now, the last question I have is – and I know that a lot of the listeners here are software folks, but there are freelancers in other areas that also listen to this podcast whose work could go towards some of these industries. Are there industries that you know off that seem to be growing, that you're aware of? REUVEN: Do you mean non-developer industries? CHUCK: No, just industries that people can kind of target. For example, we keep bringing up medical and dental, and I know that that industry is growing a lot, especially with some of the initiatives like ObamaCare and some of the other –. I've been following the healthcare arena for a while, so there's meaningful use, there's HIPAA; there are a bunch of other technology concerns that folks have. Technology in medical is something that’s growing, but also just in other areas it’s growing as well, because all of these dentists and doctors need marketing and stuff, and so going in and doing photography for their website –. My dad takes pictures of people’s mouths, kind of before and after stuff, and so being able to go in and just do that kind of stuff – are there other areas that people could focus in that you think are growing or need a little more attention that the people can find a niche in? ERIC: I think you pointed it out right there. I mean, both the medical stuff, there's a lot of new government regulations that came out, that, in a way is putting more money or repositioning how money works in that industry, and whenever that happens, the industries have to do stuff. I worked for a medical startup or whatever type of thing a few years back, and those laws directly affected them and changed what they needed – what problems they had and what their solutions were. And so anytime there's money flow, whether it’s because of a big boom somewhere or a government regulations change – or even industry regulations change – they’ll need help, and a lot of times, when those happen, all of a sudden there's this huge pain and they don’t have enough time to staff full-time employees to take care of it, and so they’ll turn to contractors or freelancers, or third-party companies that kinda help fill the gap so they can, at the very least, continue operating. I think medical’s a big one for what you talked about. The publishing industry right now is completely turned topsy-turvy. If you remember back how iTunes and all the music industry – how all that happened – that’s actually happening to the publishing industry right now. It’s insane – some of those stuff – and I don’t know if it’s quite at a tipping point, but it’s kinda getting there where if you help stuff for that, there's money going in there, there's money getting repositioned, and it’s not necessarily like it’s a bigger market but that the payers are different, and the players might have different problems than what they had 20 years ago. Also, there's industries that are always big. The fitness industry, it’s always big; housing, market housing industry, it’s very cyclical and it goes up and down a lot, but that’s always a big driver of things. I mean, look at some kind of economic stuff or census data, or look at financial reports put out by stock exchanges and you can kinda see where the big movers and shakers are, and there's typically a few amount of time. CHUCK: Very interesting. I think that’s all great information there. REUVEN: I'm just always, always amazed by the breadth and variety of work that people do. I'm always fascinated when I meet someone, then I talk to them about what they do. I'm especially fascinated by when they work in this niche industry that I never would have imagined existed. We had on – what's her name? Joanna Wiebe, probably two to three months ago, fixing up people’s coffee. It never occurred to me, really, until we had spoken to her – and maybe this is extremely naïve of me – that you could have someone who’s a consultant, she’s going to different websites and help on their text. How many people do you need? Think of all the industries that are going online and all of them want to improve their conversion rates, and so there's this huge opportunity there for people who are willing to work in that industry. Even if it’s not like a particular industry that’s growing – it’s a niche that you can easily go into. I mean, it doesn’t mean it’s easy to be good at it, but all these businesses, all these industries that are going online are requiring more and more and more specialists to figure out copywriting, to figure out advertising, to figure out mobile, to figure out stability. I met someone years ago who was starting to specialize in making sure the websites were accessible, and she became one of the world’s experts in the accessibility standards, and now people come to her all the time to do consulting on that. ERIC: Right, and if you look at it, you can also look at big trends in people. Right now, the big thing is the baby boomer generation is starting to retire; they're getting older. That is actually driving some of the increase [inaudible] in the medical because it’s a large group of people who are needing more medical because they're getting older. Well, who serves that market? I know Joanna mentioned one of the copywriting things she did for a client of hers, which is like a long-term care center. I can’t remember the exact [inaudible], but it’s like each bed there, that center can make I think 20-30,000/month, and so her copywriting really helped them out. Well, if you know, baby boomers are getting older; they're going to need long-term care – that means long-term businesses are going to be expanding to accommodate that. If you can do stuff that actually helps them get the baby boomers, you're basically looking at multiple economic trends, what direction they're going, and you can specialize, be like the copywriter for a nursing home’s long-term care center, that sort of thing. CHUCK: Yeah. Another area that I can think of is technology itself, and so all of the supporting industries for that kind of thing where the technologist aren’t necessarily good at that stuff, like copywriting. But again, we’ve also got things like the indie game industry, for example, is coming up. Those folks aren’t artists, and if you're writing an indie game, you need artwork, and so coming to understand, “Okay, there's a niche here. If I can put together terrific artwork for indie game developers, then – they all talk to each other. If I get in the door in one or two games and put together terrific artwork for it, then I can solve that problem to.” And so it’s just another arena, another group of people that may need your expertise. ERIC: Right. You can drill down pretty far. I know a guy who – it’s a product; it’s not a service – but he built a product that is kinda like a plugin or whatever to a specific 3D rendering engine that games use and it started making him –. I thik it’s full time income now, but I mean, that’s like he’s targeting gamers who are also using this 3D engine, and who also need what this plugin does, because it’s not like a general purpose plugin. I mean, he's targeting them so good that as the indie gaming industry is growing, [inaudible] is just going to growing bigger. One thing – I’ll put it in the show notes – but if you really wanna see how deep a lot of industries go, you can look at the – it’s a sick cone, and it’s also the NAICS whatever. It’s N-A-I-C-S; it’s basically kind of a universal code of like, ‘this company does agriculture’ or ‘this company does this other thing’ and it’s a way for the government to categorize, and this is how they use their census data and all that stuff to see if there's growth in sectors. You can drill down depending on what it is, like seven or eight different levels, and I've used this with a lot of searches and stuff online, because you can drill down and figure out like ‘this is the code for, we’ll say, dentist practices.’ So then you can say, “Okay, let’s do a search, find all the dentists’ practices that are registered with this code in Utah, and you'll probably find Chuck’s dad in there. This is like a really common denominator way to see how businesses categorize themselves, and if you're targeting a national industry, it’s a really simple thing to do. CHUCK: Yup. One other thing I'm going to throw out there with niches and in marketing in particular is I did some work back when I was an employee; I worked for a consulting firm at one point. One of the clients they had – basically it was a limewire, and it connected to the same network that limewire did. But the way that they got their customers is that their customers would search for a particular artists, and so they would have a search related to a particular music artist, and the when they click the link it would take them this download our app and then go and find the music, by whatever music artist you want. They were having people sign up their droves, and the thing that was interesting was that it was really just 10 fans of this artist and 20 fans of that artist and 5 fans of this other artist, was the way they were having people sign up, and it cost them a whole lot less to advertise that way, and they were able to serve these basically niche interests by helping them find technically illegal copies of their music. I think it’s very interesting too that when you niche down a lot of times your marketing doesn’t just simpler and better; it can also become cheaper. ERIC: And it’s a lot more effective. Most large companies can’t afford to market at niches; they have the money for it, but the manpower to do 500 campaigns to target every sub-niche is not worth it for them – they don’t get enough return, but you as a small business, you can. That’s why people can still write software for the windows platform because Microsoft isn’t going to build everything for it, and there are some areas that Microsoft just basically say, “Yeah, go play in there because it’s way too small; it’s not worth our large business time” and advertising’s kind of the same way. REUVEN: I'm curious; if you are in a small niche, do you need to advertise less, or is your advertising just more effective? ERIC: I don’t know. It’s two different questions. You can advertise less probably because you're going to be getting responses better, but if you advertise more you become seen as everywhere, so it’s kind of like, “Oh, this company’s everywhere. They really must care about this industry.” It’s not an either/or, it’s more of an ‘and’ CHUCK: Alright. Well, I don’t know – are there any other things that we need to say, topics we need to cover before we jump into picks? ERIC: You can change you niche at any time – that’s kinda important. I didn’t get that at first, is what you pick as you niche and what you kinda put as the public persona of your company, just because that’s what you have doesn’t mean you have to reject projects that don’t fit that. You can if it doesn’t fit your long-term goals and you have enough work, but if you pick a niche and you're starving for work, you can still pick up projects that don’t quite fit that niche. Think of the niche as just making it easier for people to find you, but if people find you that aren't a perfect fit, that’s fine. CHUCK: Makes sense to me. Alright, let’s go ahead and do the picks. Reuven, do you wanna start us with picks? REUVEN: Sure thing. I've got one pick for this week. Tim Harford – I think I've mentioned him in the past – he’s a British writer who writes about economics. He’s just a funny guy, interesting guy, and writes really well. He came out with a new book in the last few months called – well, his first book was called The Undercover Economist. It was all about microeconomics and how economics can be interesting and affect you in your day-to-day life. So he just came out within the last month or two with a new book called The Undercover Economist Strikes Back: How to Run – or Ruin – an Economy, and if you’ve ever been curious about how economics works at the country level, at the full economy level, what countries can do to get in and out of recession and different schools of thought in economics, he’s just hysterically funny, very interesting, and really brings up all sorts of great points. I definitely recommend this book; that’s it for this week. CHUCK: Cool. Eric, what are your picks? ERIC: Okay, so I'm going to pick something one of the guests pick. Kirk Bowman picked this back in April; it’s by Freshbooks, it’s a free ebook called Breaking the Time Barrier. I actually had the chance to read it last week. It’s a pretty quick read, and it’s really interesting because it talks about value-based pricing and setting fees – all that – but instead of being the stereotypical, nonfiction book, it’s written as a story fiction-wise, where there's a character who’s a freelancer and he has this problem and dilemma and he talks to people. It’s a really fast read, but there's still al lot of good nuggets of information in there. And like I said, it’s free – if you are setting your prices or having problems setting price, this might actually be a really helpful guide to go through, and so I'm picking it a second time. CHUCK: Cool. I've got a couple of picks today – are both books as well. The first one is The Miracle Morning by Hal Elrod. I read it; I've only been doing it for a couple of days; I didn’t actually get up early this morning because I had a terrible tension headache yesterday and I just – it just wiped me out and I just wanted to make sure I could have a productive day today, which kind of sounds ironic since that’s what The Miracle Morning is about. I think getting up early yesterday tied into some issues that I had with my blood sugar and other things and just set me up. Anyway, it’s a terrific book and I'm really excited to get a little further into it. I've only been doing it, like I said, for a few days, but the idea is you get up in the morning and you go through a particular routine that sets you up for success for the rest of the day. He pretty much guarantees that it’ll change your life, and so I'm hoping to report in in a few weeks and tell you how it’s been effective or not. The other book I've been reading is the Steve Jobs biography by Walter Isaacson, and it is really, really interesting. I don’t know how much useful information there is in there, but at the same time, seeing the way that Jobs approached things with the Macintosh and approached things with a lot of the other things that he did in his life – it’s really interesting to me. Just to see some of the things and how they affected him and what his mindset was – it’s interesting. Reuven put in our little chat, “you mean by being totally crazy, manipulative and abusive” and there is a fair bit of that [laughter]. But at the same time, the things that he cared about and the things that he focused on, and just kind of the magic he created from it, it’s just really, really interesting. I recommend it as an interesting read; I've been listening to it on Audible, and it’s about 22 hours long – fair warning – but so far it’s been pretty fascinating, so I’ll pick those. In general, I'm becoming much more of a book person and Audible is a great way to do that. The other thing that I've done and I just wanna point this out as kind of a friendly tip is, I have a Kindle. The problem I have with the Kindle is that you have to have a light on in order to read it, and so I wanted something that was actually backlit, and I know that’s kinda backward from what a lot of people do, but anyway, I went on Amazon and I got a $60 Android tablet. If I'm feeling like reading on the Kindle, I’ll read on the Kindle; if I feel like reading on the table, I’ll read on the tablet. It does the Whispersync thing; it actually does Whispersync with Audible as well, so it’ll actually play from where you last were reading. It’s been really nice to be able to read actual books as well as listen to them, and I found that reading a lot of these books really makes a big difference for me. It makes me think about things differently; a lot of the technical books that I need to read don’t come in audio form because it’s hard to share code snippets and things over audio, but overall it’s been really good. My other pick is just going to be books, in general. Just go out and read. Anyway, so those are my picks. We also have a book club book coming up in August. We are reading To Sell Is Human by Daniel Pink, and we had to accommodate his schedule a little bit, but we’re excited to have him on the show. If you want to pick up the book, we’ll have links to it in the show notes, and we’ll be talking to him like I said, in August. Besides that, thanks for listening, and we’ll catch you all next week. [Hosting and bandwidth provided by the Blue Box Group. Check them out at BlueBox.net] [Bandwidth for this segment is provided by CacheFly, the world’s fastest CDN.  Deliver your content fast with CacheFly. Visit cachefly.com to learn more]

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