The Ruby Freelancers Show 030 – How to Prepare for the Lean Times
Panel Eric Davis (twitter github blog) Evan Light (twitter github blog) Charles Max Wood (twitter github Teach Me To Code Intro to CoffeeScript) Discussion Preparing for lean times Cash on hand Marketing (BCP - Business Continuation Practices) List of productive activities Bank account fuel meter Emergency funds Acquiring skills Small but consistent jobs $15,000 In Income From An EBook, How I Did It: Jim Gay Prioritizing your expenses Changing your style of living and knowing what to cut Networking Reviewing expenses Wish list of companies User Groups Knowing what’s coming before it does: line up work Get Clients Now!(TM): A 28-Day Marketing Program for Professionals, Consultants, and Coaches: C.J. Hayden Focus on sales Cash flow vs income Getting paid up front/deposits Getting organized Having next steps CouchDB and Me: Damien Katz’s RubyFringe Presentation Picks iPad + Linode, 1 Year Later: Mark O’Connor (Eric) Damien Katz Relaxing on CouchDB (Evan) Regrets of the Dying (Evan) The 7 Habits of Highly Effective People: Steven Covey (Evan) Mac Power Users (Chuck) NPR Sunday Puzzles Podcast (Chuck) No More Mondays Show (Chuck) 48 Days Podcast (Chuck) EntreLeadership Podcast (Chuck)
[Are you a busy Ruby developer who wants to go to their freelance to the next level? Interested in working smarter not harder? Then check out the upcoming book, Next Level Freelancing: Developer Edition – Practical Step to Work Less, Travel More, and Make More Money. It includes interviews and case studies with successful freelancers who have made a killing by expanding their consultancy, develop passive income through informational products, build successful SaaS products and become successful rock star consultants making a minimum of $200/hour. There are all kinds of practical steps on getting started. And if you sign up now, you'll get 50% off when it's released. You can find it at NextLevelFreelancing.com]**[Hosting and bandwidth provided by the Blue Box Group. Check them out at bluebox.com] **CHUCK: Hey everybody, and welcome to episode 30 of the Ruby Freelancer Show. And this week on our panel, we have Eric Davis. ERIC: Hello. CHUCK: Evan Light. EVAN: Hi! CHUCK: I'm Charles Max Wood from devchat.tv. And this week, we are going to be talking about How to Prepare for Lean Times. EVAN: Making the space where Jeff Schoolcraft would normally be. CHUCK: Yeah. So would we be talking about how to prepare for lean times and then if we have time, we'll get into what to do when you hit lean times if you're not prepared? EVAN: Yeah, that sounds cool. That’s what we are talking about doing right, then maybe doing the second there's another episode if we need to. CHUCK: Right. So what do you guys do to prepare for lean times? I have to say I'm not very good at this, so I'm looking forward to hearing what you have to say. ERIC: Sock away cash, [unintelligible] big barrel of rice, some dried beans. EVAN: [Laughs] CHUCK: Hey, there we go. ERIC: I like how you're laughing because I actually have all of these. CHUCK: I don’t know who Eric’s barrel distributor is. ERIC: I said “barrel,” but we have couple of containers of rice. Like, we have a lot that we normally go through, but then I have a whole I guess 20-25 pound bag of white rice siting in the bottom of our pantry. And then I have a whole shelf in there of dried beans, which is more of me like, “Oh, this one looks yummy.” And never cooking it. EVAN: Okay, so that’s not the emergency supply of food though. [Chuckles] ERIC: No. But I mean, having cash on hand is actually what I really do. CHUCK: Yeah. It seems like the best way to go. I mean, I kind of got thrown into freelancing without having that kind of an emergency fund, and I haven’t been very good about saving money to make sure that I get one. EVAN: And this is the episode where you are going to be told by me at least, you probably should because you never know when you might actually see things dry up a little. CHUCK: That’s true. EVAN: It's going to happen. And once it happens, obviously, there will be no warnings. CHUCK: Yeah, it's kind of hard. I have to say just because you get the needs met and then you're just kind of like, “Okay, now I wanna do whatever it is that I wanna do.” EVAN: Well, it's the same thing as I was about to mention as another way to prep. I agree with Eric, its marketing. Marketing is one of the things that you need to be doing, so that way you keep the leads coming. You need people to know that… and I still don’t really like that word, “marketing” but you need the people to know that you are out there and what you have to offer. And if they know that, and it's something that people want, that way they know to come with you. So if you are not doing that, then you're more likely to have lean times. And even if you're doing it, you still could, but the more you’ve done it, the less likely you are. CHUCK: Should we call that business continuation practices? Is that better than marketing? EVAN: Continuous Business. It's the continuous integration. [Chuckles] ERIC: BCP? CHUCK: Yeah, something like that. EVAN: But I completely agree with Eric. When I went into this, I went in with about a year’s worth of cash in the bank. That was partly from some circumstances. I think I've mentioned this on another episode a while ago, but I was an overpaid government contractor, and our costs just weren’t meeting our living expenses. So naturally, we save money – a little. But then I realize we can get by with less, so that we had about a years’ worth in the bank. Now we have about a third of a year in the bank, after doing some master renovations on the house. So I'm feeling a bit pressured because I’m used to having that extra padding in there just in case. But yes, money is certainly a part of it. Another thing is this almost gets into what to do in leant times because in terms of prepping for it, having a list of either products or productive activities that you could do if you had more time. And when I say “productive”, I mean things that potentially either grow your worth, which feels like to me that’s a very capitalistic way of putting it, but I really should say, “To grow you as a developer is,” really more how I feel about it. Or working on a product that you care about, which hopefully, you can sell to other people or a service or something. So keeping that list of ideas like Eric was saying, he's got like 100 things written down somewhere. CHUCK: So I wanna ask a couple of questions about that, but I wanna move back to saving money just for minute. Just because we heard Eric’s approach to a lot of these when we talked about finances about five episodes ago. But what’s your approach to saving? Do you just sock away whatever you get extra, or do you sock away a certain percentage? How do you approach that? EVAN: I'm not the best at budgeting by any means, but what I usually do is I just use the number in the bank account as a barometer. And as long as it stays above a certain amount, I feel comfortable. I should be growing it more, but lately, I've been spending it a lot. So I need to regrow it. So basically, it's like a thermometer; right now the thermometer reads too low. Or more like a gas tank, a fuel meter I guess is a better metaphor. Right now, the fuel meter reads too low. I wanna get it back up to at least six months to about a year. And yes, it's socking away cash, as far as I'm concerned. CHUCK: So when you get too low, do you just work more? EVAN: Yeah. And that’s what exactly what I'm starting to do now. Lead started pouring in all of a sudden. I'm going to see how many convert, but now I've got two clients who are going to keep me very busy, instead of one client who's keeping me very busy, and it seems like there are more coming. And yeah, I'm going to try to serve all of them if I can. And also I mentioned episodes ago too, that I took the summer pretty slack, so I came in to the fall expecting to bust my butt. But I knew I was spending a lot on these bathrooms for with my wife. So I knew I was going to bust my butt to pay for them. So it was kind of plan. Which ironically, for planning for lean times, the first part of it is you have to plan. CHUCK: Yes. And I think it's interesting because the emergency fund is there for emergency. It's not just for when you don’t have work. So, if things come to the critical point with a family member or something else, then you take care of it with that as well. EVAN: Yes. It means that you don’t have to worry about where the money is coming from. You’ve got that money. And if you sock away enough, that you wouldn’t worry too much about being unemployed for a bit, then throwing it at an emergency, is not even the blink of an eye; you just do it because you know you need to when you have the cash. ERIC: I'm literally just having this experience because I had the birth of my daughter, and I basically chose to have a lean two months, because I decided not to work. And now, I got back into work and trying to scale up. But like you said earlier, not having marketing enough there, it takes a bit to go from zero work back to where it was. So being able to be at the hospital with my wife and recovering and say like, “I really don’t have to worry about work. I'm going to just eat some of the emergency fund there.” And we drew down because we actually have two. I have one for my business, and then we have a personal one. And we both drew both of those down a little bit, and then when she went back to work, and then I went back to work, having that there was like, I don’t have to panic and run out of the emergency room, and, “Oh, I got to do some client work today.” EVAN: And that’s exactly what I did this summer. I mean, not my wife giving birth, but working a lot less and not worrying about it, because I knew I can afford to. ERIC: Yeah, same idea. Same principle. CHUCK: The other thing that you were talking about was having a list of productive activities. Now, do they all have to be projects? EVAN: No. they could just be skills that you want to acquire. And I'm speaking for myself here and this gets into what to do, as I said, versus the plan. But for my experience is with what I had my one, two month lean time, I guess it was a few years ago, having a list of things to do kept me sane because otherwise, I'm just watching the bank account go down all the time, not earning any money at all. And psychologically, it's punishing. Which reminds me, that brings me to another important point; if you can just get a small, but consistent job, it's better than nothing because a lot of life is… our life really are how we perceive them. And it's easy to beat yourself up if you don’t have any work. I know I've done it. Other people probably do it to. If you have at least a trickle of money coming in, it's something. Psychologically for me, having a small client is better than no client. CHUCK: And I think it gets down to, “Okay, atleast we can pay for food.” And then it's, “Okay, atleast we can pay for food and the mortgage or the utilities.” EVAN: Right. It's not that you don’t have any money, but the drawing down from the savings. Sure it's there for emergencies, but drawing down on the savings is nerve wracking because you just keep drawing, and drawing, and drawing over time. And so as long as you are putting something back into it, then you can feel like you are doing something right. And I think that is certainly better than not having that at all. I think there's more to it than just the numbers is what I'm saying. You need to keep yourself motivated. It's easy to lose faith in yourself in trying to be a business while you are trying to find work in between gigs. CHUCK: Right. Anything to add, Eric? ERIC: I agree with you need to have something to do, to just keep up the energy because I've run into this when I first got back, I was having a hard time even doing three hours of work a day, because I would just be unmotivated. There isn’t like this attainable goal that I could see in the horizon. And so, I had that problem and then I kind of started building some of that stuff around, and now I'm back up to like kind of full time 7-9 hours a day. But one thing I've kind of want to disagree with Evan is he said, “a product.” I'm all for making products, and I think they are great for freelancers, but if you don’t have any income, making a product is probably not the best thing for you to do, just because there's a lot to it, like behind the scenes. And once it's out there, I mean, Evan you talked about this with your iPad app, I mean, once it's out there, you’re going to have kind of a raised expectation like, “Yeah, this might make me a couple of thousands of dollars a month.” And then you make only $12/month. EVAN: I completely agree there. Going into products, you have to be realistic chance that it won’t change any money at all. That that’s one of the ways that I tend to look at products. It's more to me about doing something to stay busy, where I'm acquiring skills that I want, than usually it is about trying to build something that’s specifically… if there was a particular product that I really cared about so much, I would be building it on my own time, even while I had work. And I would invest in it by working less to work on the product. If I were working on a product in my own time because I had nothing better to do, then it's because I have nothing better to do, and that’s not going to be the best kind of product. So, it's a valuable point you raised there. I don’t want it over emphasized working on a product. I really wanna emphasize building up skills that you think will be useful that interests you, I think is the most important part. So Chuck, am I allowed to mention the person who is not here yet, that’s going to be here? CHUCK: Sure. Go ahead. EVAN: Okay. So Jim Gay is starting on the podcast next week. I'm not going to be here for that, but… so I guess I have another pick. He wrote a blog post recently about his experience writing a book and making money off of it. Writing an eBook on software development and making money off of it. I [unintelligible] him about that about how much effort he put in with versus how much he's earned so far, because I know he's put a lot of time in. And based on his current earnings, I suspect it's nowhere near his hourly rate. Granted, he's not done earning on it yet, and he's still working on the book. My point though is that he did something that mattered to him because he wrote this book, because he was so fascinated by this topic, that he wanted to learn more about it. And so he chose to invest his time in it, and he got to do something that he really cared about, and he got to make money doing it by sharing it with other people. And that to me is awesome. So this is the kind of thing that would be hard to do, holding down a contract job possibly because writing a book is from everyone I’ve talked to about it, because I occasionally dabbled with the idea, it's a pain in the butt. It takes a lot of effort. And so I believe he was doing… I'm not positive, but I believe he's doing less contract work while working on a book. But he did something that mattered to him, something significant and he got paid. And to me, that’s about the best thing you could do on your job. Other than maybe help other people, which if that’s a personal thing [unintelligible] that’s a good thing. CHUCK: Yeah. So one other thing that I wanna bring up before we start talking about what to do when you hit a lean time, is possibly budgeting. And when I talk about budgeting, I'm not talking about saying, “We're going to spend this much on this, and that much on that.” But I'm talking about prioritizing your expenses. And I kind of alluded to it before. You put it in order of what is most important. You pay for food, you pay to keep the lights on, then you pay for mortgage, you just work down the list. And if you know that is and you know that your money is going to be restricted, then you know which things are going to be paying for, and which ones you should not. EVAN: Okay, so one of the first things I learned, and I did this coming out of the government working for a startup and taking the big pay cut so I could work with the startup, is that usually, we're respective of what we're doing, we can get stuck doing what we are doing by [unintelligible] golden hand cuffs. The expression meaning that we get used to our style of living, that we're unwilling to change it even though it might improve our style of living. So to that extent, when we move out here, and I started working for the startup, it was all about, “Okay, what can we cut back on? What things will be cheaper about? What things don’t we need to be spending money on?” And I very quickly realized that living on half of what we were living on before really wasn’t that hard. CHUCK: Yeah, it's just knowing what to cut. EVAN: You are right, what to prioritize. There are certain things you don’t really think about much. You're going to have the mortgage, you are going to have the energy bills, those aren’t going to change much; you have to pay your insurance and what not. But you can cut off the premium cable services. You could actually no have an iPhone. Oh my god. Because the cost of owning something like an iPhone is kind of something like $4,000 over two years, when you total up the cost of buying the thing and the service, something ridiculous. There are a lot of different little expenses that you can churn back and that are going to add up into an awful lot of money. And oh yeah, don’t eat out so much. This is the one that use to kill us when we were in Virginia that we would go eating. We would eat out all the time. Cooking at home will save you tons of money. CHUCK: Absolutely true. Is there anything else that you can think of talk to about, in preparing for lean times? I mean we did talk about marketing, but I don’t know if there's anything to add on that. ERIC: When you are preparing, like if you have work right now, keep marketing even if it's like a trickle, like try to have regular that you are doing marketing-wise, or just even networking. Not like, “I'm social networking on Twitter,” but just talking to other people. So if the lean times hit, you have these kind of warm connections you can kind of rekindle easily, versus it's like, “Hey, I don’t know who you are. I'm asking for work.” Another thing I do, I don't remember how regularly, but atleast once or twice a year, I'll actually review my expenses, especially on my business side. And I'll look at stuff and be like, “Okay, I'm paying $100/month for this. Is it really worth it?” And so that kind of lets me audit things a little bit here, a little bit there. And on the other side of it is I actually can sign up for new services and try them out, pay for them a little bit. And I know in the back of my head that I'm going to actually reflect on this and see if it's actually really worth it in the long term in a few months. And so I've done that to kind of try stuff out, see if it doesn’t quite work for me and kill it off. EVAN: So I'll admit what you're saying, Eric. You said a lot of what I was going to say too, and that’s cool. To me, knowing lots of people, it comes kind of naturally to me because I just like people. But to that extent, keep a wish list of companies you wouldn’t mind working full time for as an employee, because that’s always one of the final fallbacks is get a job, you get a full time job, instead of being a freelancer, give up the business. And so if you keep the list of companies that you’d like to work for and you know people there, well then ping on those people and check to see if they might potentially need someone at some point or if they might be interested in you at some point if things are to change, if they would be willing to work with you remotely or if you would have to move or what not. Feel them out. If you know people you might wanna work for, then have that as a backup plan. ERIC: Yeah. That’s what I do is like, my wife and I have talked about it, like if worse come to worst, then nothing works and all these problems like I'm close to Portland. I can commute everyday, and Portland is big with this. I know two companies. I know the people there personally that are hiring. And it's like, the Portland Seattle area and like when you include that, there’s a lot of people hiring. And that might be just the market cycle we are in, but for right now, if you can’t make freelancing work, you could probably just get a normal job. And on the side note, some companies might be okay with you moonlighting on the side. And that could be another thing is maybe you get a job that’s not necessarily like tech, like you're not actually programming stuff, but it's just straight 9 to 5 and when you clock out, you are done. And then you can do moonlighting on top of that. So there's a bunch of options, like if lean times turns into a really long lean time and it's like, “Okay, my belt is already tightened.” CHUCK: One thing I wanna point out with that too is if you are going to go back to a full time job, and it's also a good way of marketing in general is going to the users groups, because that’s where the local companies or the guys that work for the local companies are, and that’s a good way to get your foot in the door. EVAN: Not only that, but those are the ones you probably would want to work for too. CHUCK: Yeah. The other nice thing is that in a lot of cases, those companies that are local to you that you may want to work for full time as a last resort, you may be able to work something out so that you can contract for them instead. EVAN: It feels so “first world problem” to talk about this last resort. “Oh no, we are going to take a full time gig working for a company that’s probably kind of [unintelligible]” What Eric said that the market currently is pretty good for us, as long as you are decent at what you do, you'll land okay. It's just a matter of how you language and where you land. CHUCK: Yeah. Okay, so what happens when things slow down? You have most or all of your contracts complete or they decide that they are out of money or whatever, and so they let you go. What do you do? EVAN: First thing I try to make sure that I have good enough relationship with the client that I know it's coming before it does. So I know what their budget is, I know where I am in their budget, so that way, I can be planning for it before it happens. And when I know that, I've been pretty good about being able to line up work that dovetails nicely with leaving the client he's running out of cash, and then starting work for another. If you don’t have that warning, then you get that grinding of gears where you don’t have work for a little bit. In either case, what I’ve done is I basically revert to the Get Clients Now book, which I wanted someone to mention that in this podcast because marketing, marketing, marketing is very important to avoid the lean time. People need that you are there to be able to hire you. So I step up my marketing game as either I know I'm cycling down on the client, in that I don’t have leads at the moment, or if I cycled out and I need work. ERIC: What I do is… if it's lean, like I don’t have any clients at the moment. And so it's like, “Okay, I'm heavily focused on marketing.” And something that Evan didn’t really say, is like I actually heavy focus on sales. So if a lead talks to me, normally if I'm busy, it might take me a day or two days to get back to them and if I'm completely booked, it might be like just like short emails, “Sorry, I don’t have time for you.” But when I'm lean, I'm like within a few hours of replying people, when I have very, very hard core follow up. And that’s gotten me projects over the long term. So if things are really tight, I'm like, okay, not aggressive or pushy, but I'm more frequently I stay up to date, I make sure I don’t miss a follow up schedule or any of that stuff. Another thing is you can really ask for the sale more. Like if you are talking to someone and you don’t have any work, you can say like, “Look, what would it take for us to get a contract on this right now, so we can start next week?” EVAN: That’s a pretty hard sell. ERIC: Yeah but I mean, don’t beat around the bush as much and kind of have a bit more confidence. And most of the time, especially when we're talking about entrepreneurs or like CEO level, they are going to respect that kind of confidence, and they know you're not just being pushy, but you're just trying to make sure you are not wasting four weeks talking about something. EVAN: Assuming they are talking to you, and they are serious about potentially doing work, then it makes sense to just close that deal. You're right, I didn’t talk about sales, but everything you said, I already do. I just don't really think about it consciously, but on reflection… except for the hard sell part. I've never been good at that. I feel very uncomfortable doing that. That’s just me. I think what you said sounded perfectly reasonable. ERIC: Yeah. In the same context, you might have talked to them for half an hour or an hour and hash it out. And it seems like it might be a good thing and it's between this semi-hard sale, versus like, “Let’s have another follow up conversation in two weeks.” EVAN: Another thing that I do, I feel like maybe I'm not reciting things from Get Clients Now, but maybe it kind of feels like I am, is that I start pinging on at least one lead, one contact, one person a day. I reach out to a network of people that I know who either might have work or might know who might have work. And I ping on them at least one a day. Sometimes just one. It's just a matter of how anxious I am or if I really just want a little downtime. Frankly between clients sometimes, I do want a little break. If we're really talking lean though, I aggressively ping more than one person a day. And the catch is of course, it takes time, you're beating around the bush, it takes time to develop work, so even if you are generating leads from this process, it still takes several weeks usually for these stuff to pan out. Occasionally, you get one of those client’s, “Okay, I need you yesterday. Sign a contract on and off you go.” I've had some of those too, but then I've had just as many or more work. It takes a few weeks of discussing before there’s a contract signed. ERIC: Yeah. Even in non lean times, I've found it takes about a month from first talk to someone to one where it's actually like contract signed. And then it's depending, it can still be another month or two before the project starts. And then to even add on to that, depending on how you do your contract. It might be another month, and sometimes even two months before you get paid. It's a long process. EVAN: You are the only one who in the past, have dealt more with enterprise type clients though, right? ERIC: Yeah. EVAN: Okay. Because I have been working more with startups. And so, they really do come in two flavors. It's the, “We need help now.” Or “We need help yesterday.” I got one like that. I got one client a few years ago, or a couple of years ago, actually, was, “Can you be on a plane to San Francisco tomorrow?” What?! CHUCK: [Chuckles] EVAN: But quite literally, that was almost how the conversation started, which kind of had me floored. But working with startups, you get the guys, they have a tech team, but they realize they are in over their heads so they need help, and those guys want it usually immediately. I've had a few like that. And then you get the business men who are dabbling with an idea, and they just take forever, and they usually don’t close. Occasionally, they do. ERIC: Yeah, and that’s a lot of my client’s like you said are more enterprise-y or whatever where they are planning and they have budgets and all that. EVAN: They are bigger businesses, so they’ve got more process and it takes more time to get stuff done. ERIC : And honestly, when I was really busy, I was scheduling work about 6 months ahead of the time too. CHUCK: Yeah, but you're dealing with those corporate clients, you're dealing with the process that they have for accounts payable, whereas with the smaller companies, they are usually a little bit more along the lines of, “Oh, we got a check. We got to handle this now” kind of thing and so you get your checks more quickly. And so there's that too. And the other thing that’s helped me because I hit a lean time, I haven’t hit like major one that’s lasted more than a few weeks, but I'll sign a contract and I'll get the deposit, and then deposit can kind of hold things over until I get paid by them, and then I can re-inflate that and make it work. ERIC: Yeah, and that’s something that freelancers don’t touch on very much, but like more standard type businesses do, and it's cash flow versus income. If you invoice someone right now, you made income, but you don’t have the cash. And when you're going through a lean time, cash is king. And so if you do like what you’ve said Chuck, you had a deposit get half a month or whatever up front, your lean time basically just stopped. I mean yeah, it might have taken a bit before your next payment, but you were able to kind of pay your mortgage or get groceries, whatever the problem is. CHUCK: Yeah, so basically you’ve found a place that you can kind of jump to because you're at the edge of the cliff, you find a place to jump to, until you can climb back up. And it gives you that little bit of a lift to work around it. ERIC: It almost seems like if you are in a lean time, and you kind of like you're getting out of it, like say you’ve got some leads and looks like they are going to close, if you optimize and try to close the ones that are going to give you the largest chance or the largest amount for a deposit, and/or the smallest or I guess kind of the least process-oriented companies, that might be something to help us celebrate if you're really struggling against a rock, versus like trying to close a government contract, which might take three months after the contracts close. EVAN: Oh yeah. CHUCK: But at the same time, keep pushing the longer term leads. Because again, there's no guarantee that those smaller leads are going to close. They may close faster, and that’s good for you, but you don’t have a guarantee from them either. EVAN: I've had mixed results there too. I had one time when I was flooded with leads, and all of them closed. And I had one time where I had leads and none of them close. You never know. You really don’t. ERIC: Yeah. And that’s kind of why I said “optimize”. It's the idea of, “Okay, you have two emails, which one do you respond to?” Like maybe pick the smaller, the faster company over the large, more bureaucrat company. EVAN: Well, the other thing to consider if you are if you are low on cash, and you are looking for work, then getting that longer term contract is a light at the end of the tunnel that’s probably not a train. Because, Eric, you can correct me on this, but as an enterprise client, I would tend to think that they are less risky as a client in that they are less likely to just up and bail on you, whereas with a start up, you never know when they might run out of cash. ERIC: I would say more than likely, yes. I mean, I still had the same problem of the full startup or the PM in the enterprise basically going dark, which everyone hates. But I would say, the more enterprise-y companies, they are better at paying their bills on time, and they are better at like, “Okay, we have a contract. We need to honor this agreement until we can get out of it,” type idea. I mean, theoretically you're contracting with a VC startup or whatever and they go bankrupt, your contract could be void. EVAN: Or even if the contract isn’t void, depending on the laws of the state, they may never get around to paying you. ERIC: And that’s what I mean, you can basically just kiss that goodbye because the company is not there anymore. The legal entity is nonexistent. EVAN: Which is one of the reasons to take a deposit in the first place. But that doesn’t help you when you are already low on cash, but it's one way to ensure payment is have it already. CHUCK: That’s true. I actually had somebody on Twitter that basically, and I don’t remember exactly what they were replying to, but basically they said, yeah, most folks understand if you want them to pay upfront because they see the risk there for you. They'll pay upfront and then you don’t worry about not getting paid for the work that you did because you have it upfront. I don’t know if that works out all the time, I mean, some clients they wanna see work and then they wanna pay for the work. EVAN: I've had a few clients where they were utterly flabbergasted that I asked for a deposit. CHUCK: Yeah. EVAN: And I've only worked with one of those. I mean, I've worked with more than one client who won’t give a deposit, but those other clients were able to provide other insurances. I worked with one client like that, and he was a client I didn’t work for for very long. We had other issues. ERIC: One thing I can give out is the lean time if you are in it, or you’ve seen one coming up, like how lean of a time is it? Is it just you got whole things over for a couple of months, or is it like, “I don’t see the end of this at all.” EVAN: That’s another thing. For me, I usually have some amount of time or money that I'm willing to spend before I'll just say, “The heck with it. I'll go get a job.” And that is establish a constraint, because if you leave it open ended, you are just going to chew on your fingernails. It's going to be anxious not to spend the savings down anyway. If you put a finite stuff to where you say, “If I don’t get a job by the time the bank accounts down here [unintelligible] by the time the bank account is down here, or by this date then I will just go get a full time job.” ERIC: Actually yesterday, or maybe the day before, I made an index card, figure out how much I have in my emergency fund; what my burn rate is, which is how much I'm losing each month, just living; and wrote down the next few months. And I have a few months and I just have a little picture of a fire, which means basically that's the end of the line. And so working backwards from the end of the line, I figured I need to book a client. And if they are paying on that thirty, I need to have work done by this date, which means I need to have worked by this date, which means I need to have a contract by this date. So that gives me like, “Okay, I have a few months to kind of…” I don’t have to panic, but then when those few months are up, it's like, panic mode. Look for alternatives or whatever. EVAN: Right. So you were trying to firmly establish what the furthest possible constraint was, that you could get away with? ERIC: Yeah. And I mean, as you guys known, some of the listeners might now like I'm very much a planner, because I was stressing out. I think Monday. I was freaking out. I was thinking like, “Oh, I don’t have a client.” And I'm sitting on a decent sized emergency fund, so it's really not a problem for atleast two months before I really have to worry about it. But me being a planner, me seeing like you said, Evan, savings going down, I was panicking and that was making my work and my marketing suffer. So I sat down, did this and I'm like, “Oh, I actually have a bit of a cushion here. I can take it easy. I can chill.” EVAN: That brings me to another thing, in those sorts of times I think that’s also where getting things done is very applicable, because there are a lot of stresses on your mind, getting them all out of your head to do some kind of system where you can manage them is huge. And that sounds like you did that, and then you used that to generate a spreadsheet or something like that, I assume, where you were able to figure out, “Okay, when do I have actually have to have a contract by?” Even if you don’t go to that extent, if you make lists of all the things you need to do in order to try to generate work, then you’ve got a plan, you do have to stress about, “What am I going to do?” You know what you are going to do. You just have to do it. You just have to go at it. Which goes back to “have a plan.” We're saying a lot of that really, you just have to think ahead. CHUCK: Yeah. But at the same time, I mean, what you said wasn’t just that you need to have a plan. I mean you're talking about getting organized. EVAN: Okay, so not getting paid feels chaotic. So really what you're doing is finding order to the chaos. You are not rearranging the chairs on the decks of the Titanic, but it can feel that way a little bit, but it brings some order to that chaos. It can be calming and empowering. What Eric kind of alluded to and I've kind of alluded to, I think without saying it outright, is getting that work when you are in a lean time, you have to remain confident. You have to be able to believe in yourself. And if you lose that, then you need to get that full time job. CHUCK: Yeah. EVAN: That’s also a vicious cycle. If you don’t have work and you are panicked about not having work, when you talk to a lead, they are going to pick up on that even subconsciously and they are going to be like, “This guy seems shaky. I don’t wanna work with him.” And therefore, you cycle in deeper. CHUCK: The other thing for me is that I have plenty of work right now. I'm working pretty close to full time contract. These last few weeks, I've kind of felt like a refugee a little bit because there was so many things that I was trying to keep track of. And I hired a new VA, and I got a few other things organized. And it just gave me some clarity of mind. It just made it easier for me to deal with stuff in general, and just feel like it wasn’t suffocating me anymore. And I can only imagine if you have a lean time that last maybe a little bit longer than some of the few weeks that I've had where I didn’t really have a lot of work to do, that that’s got to be just totally suffocating. And so knowing where everything is, knowing where all the pieces are on the board has just got to take a huge load off. EVAN: Having next steps takes a lot of the load off. I mean, that’s very much a GTD thing, but knowing what you're going to do next if you're if you're still trying to get work, having that plan in place is comforting. If you don’t have that at all, then you're going to just be reaching its straws where, “What do I do next?” Then that’s another source of anxiety. Knowing exactly what it is you are going to do next like, “Tomorrow, I'm going to tweet this for or make this phone call or reach out and send an email to this company.” As long as you know you're going to do that, then that gives you something to hold on to other than just maybe working on your skills or if you have a hobby project or something like that to work on. CHUCK: Absolutely. Are there any other things that we can do at lean times that we haven’t talked about that we should cover? ERIC: Let’s review, so we talked about doing some more marketing, getting more aggressive of like sales or follow up stuff, reaching out to people that you already know, saving money, cutting expenses where you can, what else? CHUCK: Picking up new skills or projects, and making up a plan and getting organized. ERIC: One thing that I can think of and this is, “Do what I say, and not what I do,” type thing, but if you are having lean time, realize that it's not your fault. It could be economy, it could be a client dropped a project completely. There might have been things you could have done better, but that's not your fault. And even if it was slightly your fault, blaming yourself is probably not going to help you at all. And that comes back to the whole confidence stuff. If you get too hard on yourself, it's going to make everything else worse. So you kind of have to realize, “This is a situation I'm in. I just need to get out of it. I don’t need to really dwell on where I'm at and just move forward.” EVAN: Let me add one more thing because it occurs to me that this lines you to something I’ve been talking about at conferences lately. What's the worst that’s going to happen? The worst thing that can happen that your house gets repossessed, your cars get repossessed, it's a country song. Your dog dies. That’s about the worst thing that could happen, but if you are still alive, you still have your health, you still have your brain, you still have your family, even though it's stressful, you're still there and you can still climb out of it. You can still change it. And what I've been telling people a lot to because it's what I did, when I went through a… it wasn’t money, but it was an emotionally turbulent time because of my wife’s health. Well, it still is turbulent but not in the same way. But one of the guys who inspired me, Damien Katz, I'm glad to mention his name, he gave a presentation at RubyFringe several years ago where he went through a really rough patch where he got laid off. And he stuck to what he believed and what mattered to him. He kept working on CouchDB. This was before CouchDB was CouchDB. And he kept working and working on it. This little company called IBM came along and said, “Hey, we wanna pay you to work on it.” So what he did was he did what he loved and then he shared it with other people. And this comes out of Seth Godin. So I'm talking about kind of marketing after fashion. But my point is you can do what you love. And as long as you're fervent about it, you keep after it, but you let other people know what you’re doing, so that way people know what it is you're working on, that’s part of telling them what you have to offer. Then that passion and confidence will come through. And I'm not going to say it's the “secret” where the power of your mind gives you work, but your life will be better for doing something that you care about. And you'll probably be able to find work doing it. CHUCK: Makes sense. All right, well we need to get into the picks. Is there anything else we need to cover? I guess not. All right, let’s do the picks then. Eric, do you wanna start us off? ERIC: Sure. So this blog post came out a little bit ago. Basically, Mark O’Connor on the developer and basically he I guess about a year ago he started. His MacBook pro broke I guess high speed bottle intersected with the screen, and so it broke. He decided he didn’t wanna try to fix it and started working on his iPad. And so the post that just came out recently, it's actually a year of experience of actually doing all of his work an iPad. And he's using an iPad and then a Linode VM, which basically using screen, I think he use Vim and he actually uses like VNC and stuff he's actually able to do all of his work. And so this post is kind of like a year reflection about it. He talks a bit about how you can go to the park and work on stuff, and then if he has to take a conference call, he can disconnect, walk to a coffee shop and take the conference call while he's walking. So it's a lot of the freedom of space as a freelancer or whatever, you can work pretty much wherever, as long as you have access to in this case, a server that has Ruby or whatever. So I thought it's really interesting. I'm trying to kind of isolate a lot more of my stuff, not so much that I can travel and get out, but that if my laptop breaks, or if I find myself without my main system, I can still do stuff that I need to do. So that was an interesting post. I'll put up his 1 Year Later’s reflection. At the very beginning, he has the link to the original one, so you can kind of start there if you need to. And that’s it for right now. CHUCK: Okay. Evan, what are your picks? EVAN: I have linked Damien Katz’ presentation. I hadn’t gone digging for it at all. Eric got me to try to find it by typing stuff in the chat. Another one that I've been talking to people about, kind of ironic that Eric was talking about the quality of life kind of thing, because that’s what I'm going to mention. One of the things that helped me gain clarity is… or one piece of content, this blog post of that is called The Regrets of the Dying. Yes, it sounds fairly depressive, but it's about a woman who worked in a nursing home, and did she was around a lot of dying patients, so she made a blog post about the five most common things that people mentioned on their death bed, that they wish they have done differently. When you get right down to it, one of them is a little bit ironic, given the topic of the podcast, because I wish I hadn’t worked so hard. But then, some of the other ones are really elemental. “I wish I'd been true to myself.” “I wish I had the courage to express my feelings.” “I wish I’d stay in touch with my friends.” “I wish I’d let myself be happier.” One of the ones that I mentioned just a little bit earlier, in terms of the doing what you love and then just sticking to it even in hard times, to me, that’s very much the, “Be true to yourself.” That’s what I did when I left the government, took a big pay cut, went and worked with Ruby, and I didn’t expect I was going to get paid a lot more. But just by sticking to doing what I liked to do, it's come back to me. So I think it's a worthwhile list. If you haven’t read the 7 Habits of Highly Effective People, it dovetails very nicely with… I forget the exact principle in the book, but it was something about see everything from the end… CHUCK: Begin with the end in mind. EVAN: Thank you. You have it in front of you or have you read it recently? CHUCK: Neither. EVAN: You just remember? Good for you. [Chuckles] CHUCK: Yeah. Stephen Covey is actually a local. He used to be a professor at BYU. EVAN: I know he's out there in Salt lake. CHUCK: Yeah, one of my former employers. EVAN: Yeah, he was a local. He passed away, I think. CHUCK: Yes, he passed away in July. But quick story, one of the guys on the sales team when I was working at Mozy had married Stephen Covey’s granddaughter, and so for one of our work parties, we went up and had a barbeque at his house. And had the rest of the party was actually in his pool house, and so we all got to play in pool and things. And it was pretty cool. EVAN: That’s a guy whose hand I would love to have shaken. That’s a good, good book. Anyway, that’s it for me. CHUCK: The first pick that I have is a podcast, I believe it was started a bit earlier than 5x5 the podcast network came out. But I really, really enjoy it. It's got some great stuff on it. It's called Mac Power Users. They range from about an hour to two hours long, some of them are even longer than that. But they really go into depth, and cover some awesome stuff about what you can do with your Mac. And so the early ones, they kind of cover topics as a whole, so like networking or like the Dropbox quicksilver kind of things, and they talk about how they use them and how they work into the workflow and things like that. And I think they have one on key note, they’ve got a couple on like calendar stuff. I mean, it's just amazing stuff. And then they bring people on who use Macs and talk about their workflow on the Mac. So if you want a good podcast on how to use your Mac, and what's out there and what's available for it and then go check it out, it's Mac Power Users. I'm going to pick a couple of other podcast that I really enjoy. One of my favorites is kind of column, it's from NPR. It's the Sunday Puzzle podcast, and those are kind of fun to sit and puzzle over for a little bit to figure out what the answers are. Another one that I liked off and on that I'm going to also pick is No More Mondays. No More Mondays is a book written by Dan Miller. And he's allowed these two guys Justin Savage and Andy Traub, to kind of take the name and make the podcast out of it. And they talk about a lot of things related to business and running your small business and things like that, following your passion and that kind of thing. And if I'm going to pick that, I may as well mention the 48 Days Podcast by Dan Miller. And he talks to a lot of people who are either in work situations trying to get to the point where they can move ahead or get past those work situations, but he also addresses people who are self-employed, and some of the things they are dealing with. So I highly recommend that one as well. My last pick is the EntreLeadership podcast by Dave Ramsey. He wrote a book by the same name. And they interview these CEOs and people and they talk about these different aspects of running a business. And if you are like a solopreneur or something, some of the hiring and firing and dealing with employee stuff doesn’t always matter right away. But some of the other stuff like time management and managing cash flow and things like that, some of the principles behind running a successful business are just winners. And there have been just some amazing interviews on that show. So I highly recommend that as well. And that’s it for my picks. Is there anything we wanna go over before we wrap this up? EVAN: Yeah, there's something I wanted to say. We've all kind of had a lean time, and haven’t gotten through it or are getting through it. And as beginning freelancers, I get it's a scary thing, like specially if you’ve never done any kind of small business or any of that stuff. And so, not having clients can kind of get scary, and like what I was saying earlier, you can panic about it. So if anyone wants to like email me or maybe I don’t know if we have actual public email address for the show, if you just like need some help or like, “Hey, I don’t know what to do,” or even just, “I need to run this by you, this is what I'm trying to do.” I mean, I'm here for people. I'm sure some of the guys in the podcast are too. Sometimes you just need to talk to someone about it and get it out there, and you'll feel better about it. CHUCK: Yeah, absolutely. EVAN: I've done a little bit of that already. I get occasional emails like that. Yeah, I don’t have any problem with it. If someone wants to take up a lot of my time, that’s where I wanna bill them for the discussion, if it's going to be related to their business, like it's like an hour. CHUCK: Yeah, it's kind of the same here. I think that’s the same for any of us. I mean if it's going to take three hours a time, I don’t know that that’s necessarily reasonable considering that we're all busy, but if it's something where you just wanna hit us and get a few minutes or have us email you back or whatever. You know what I mean. If you wanna email us or something real quick, five, ten, I'm even open to maybe 20 minutes to help you out. So yeah, you just email and we'll see how much bandwidth we have, and whether or not we can help you out and offer you some advice. That’s fine. EVAN: I wonder if we just opened the floodgates. CHUCK: [Chuckles] ERIC: We reserve the right to ignore emails. CHUCK: Yes. EVAN: I generally never ignore emails, it's just that worst case, I usually give a short response. I mean from someone who’s emailing about freelancing. Recruiters, I ignore them. ERIC: For me, it always depends on how busy I am. Like I said, if it takes… if I'm still busy and it takes me week to get back to a lead, non-lead or non-critical emails might take a bit longer. But I just wanna throw it out there, I mean even if it's like, “Hey, I'm having a problem with this,” because I've gone through stuff. I've found links that might help me, and this can be just a quick one minute like, “Hey, read this or do what someone talked about in this post.” And I just think that might be a good help, especially during these hard times. CHUCK: I agree. I also reserve the right to say no. If I don’t have time, I'll just tell you because I don’t want somebody sitting there and waiting for me response if I don’t have time. All right, we'll wrap it up. We'll catch you all next week. Thanks for listening!