How are freelancers billing you?

Suppose you're busy getting an initial version of your MVP up and running, and you've decided to hire freelancers to help you build it.

How are they billing you? Hourly? Or fixed price?

If the answer is hourly, you're probably throwing money out the window. That's because the freelancer has an economic incentive to bill you more than what's necessary, and not to be incredibly efficient.

It's even worse if done through recruiters.

That's not to say hourly is always bad. But for developing an MVP, where there's a lot of unknowns, it's almost universally bad, because it lacks accountability.

Instead, try and stake out initial feature sets that can be billed according to the value they bring your company. If you're lacking a technical co-founder, do a paid discovery session with the freelancer of your choice. Otherwise, if you're a CTO at this stage, you'll know what your MVP needs and what it doesn't.

Limiting what's being worked on doesn't mean being rigid. Communicate often and openly. But having a clear end goal in sight, for a fixed price, is miles better than "Here's 150€ an hour, please develop this idea and all the other ideas we have down the line."

Yours,
Søren