There’s a paradox you’ll discover as you’re building your team: even though hiring great people benefits everyone, nobody really enjoys the process. Agency owners struggle to write job descriptions, conduct interviews, and make judgment calls about the best candidates. Candidates hate the process of searching for opportunities, crafting resumés, updating portfolios, and feeling like they have to sell themselves to one company after another.
I’ve met thousands of creative and technology professionals in my career – and not a single one chose their career because they love sales. We’re creative! We want to create cool stuff! And the hiring process is really just sales by another name – the company sells itself to candidates, and candidates sell themselves to the company – which means we’d all like to get it over with as quickly as possible.
So, how do you best simplify and shorten the hiring process? By making sure your great new web developer sticks around so you don’t have to go through all this again for no good reason.
Data from the Work Institute’s 2019 Retention Report shows that recruiting and training a new employee can cost a business up to four months of their salary, not to mention any lost productivity during that time. The same study reports that the top two reasons for employee attrition are career development (22 percent) and work-life balance (12 percent).
Web developers are no different.
Sometimes they leave for more prestigious opportunities in Silicon Valley. Sometimes they’re seeking a company with more diversity on its team. Sometimes they’re offered an alternative with more flexible hours, more location independence, better pay, or all of the above. I’ve seen this happen in the best economic times and the worst because talented developers always seem to be in demand.
Unless you’re actively working to forge a long-term relationship with your developer, chances are someone else is working much harder to lure them away.
It’s most painful for the agency owner when a developer parts ways with a company and leaves key projects hanging – which, even in the best circumstances, is hard to avoid for an agency that always has many projects at various stages of completion. (Even if someone gives a month’s notice, they can’t realistically wrap everything up before they leave, and it might not be enough time to hire someone to fill their role.)
None of that sounds like fun to me, so I take a proactive – and, admittedly, somewhat extreme – approach to retention of my team: I want to build an organization that no one wants to leave.
And I want to continuously deliver the benefits – including top-of-market pay, location independence, schedule flexibility, and a culture of diversity and inclusion – that I know will set Howard Development & Consulting apart when competitive tech companies come calling.
Retaining high-end contractors, and how to not be Uber
Among the long list of tragic Silicon Valley outcomes is the perception that all freelancers and independent contractors are abused by corporations, and that everyone would prefer a traditional job if presented the choice. This is absolutely true of gig-economy companies like Uber and its many copycats – they’re so horrible to their drivers that California passed a new law in an attempt to compel them to treat people with dignity and respect. (The fact that this law was controversial should tell you a lot about the ethics of most technology companies.)
However, it’s not right to paint all independent contractors with the same brush. Beyond the realm of Uber, DoorDash, and starving-artist freelancers, there is a whole world of highly paid, highly skilled professionals who actually want to be independent. I know because I am one, and I have hired many of these all-stars to my own web development team.
This hidden world is full of widely experienced, highly skilled developers who are eager to stay with your company for the long-term. They could go work for Google tomorrow, but when they get those offers, they just smile and turn them away. They don’t crave so-called career advancement because they’ve already found their sweet spot. They’re not just earning an income that competes with the best in Silicon Valley, but they’re doing it in a way that provides flexibility and independence that none of the big-name companies can offer.
“Have you heard about those companies whose benefits include game-console rooms, cereal snack bars, top-chef lunches and dinners, nap rooms, laundry service, and free beer on Fridays? It seems so generous, but there’s also a catch: You can’t leave the office.
These fancy benefits blur the line between work and play to the point where it’s mostly just work. When you look at it like that, it isn’t really generous – it’s insidious.
These mainly exist at companies that work 60-plus hours a week, not 40. Sounds more like bribes than benefits, doesn’t it?”
– Jason Fried and David Heinemeier Hansson in It Doesn’t Have to be Crazy at Work
When you hire an experienced freelancer, you get someone with a wide range of experience (they actually do know all those frameworks and languages you’d find in an over-the-top job description). They’re generally business owners, which means they’re solid communicators, and they don’t need nearly as much training or hand-holding as in-house employees who are early in their careers. And because they’ve already arrived at their major goal – running a flexible, independent business – they’re happy to stick with you for years or decades.
Here are the top three ways to retain your best web development talent.
1. Provide a roadmap for career growth
One of the challenges of running a relatively small business is that your most valuable and ambitious team members often look up the ladder and see only you – which means limited growth potential since they’re not likely to take over your role as owner any time soon.
This is one of the areas where a big tech company can really appeal to a young developer – by showing a clear path to a career that’s bigger and better in many quantifiable ways.
To compete with that, you’ll need to get creative about how your company is structured and how you compensate your team as you grow. If you’ve been working with a developer for years, it’s likely they’re thinking about how they can someday become more than “just a developer” – that could mean managing other developers, shifting to sales or account management, or some combination of the two. I encourage you to nurture those instincts when you see them in your team because it means they’re aiming for growth that will be mutually beneficial – they’ll advance their careers and grow their incomes while helping you build a more valuable business.
For a long time, it was difficult for me to embrace growth. We’d get to a place where we felt like we were “sold out,” and then we’d slow down marketing and sales and focus on delivery. That was fun, but also set us up for stagnation and sometimes put too many of our eggs in too few baskets, exposing us to risk if a large client were to end their contract.
And even though we were making plenty of money with that strategy, it had the nasty side effect of stunting my team’s career growth – and more importantly, constraining their imagination about what the future might hold. If my five-person company is still going to be a five-person company in 10 years, then my team’s only real option for a career leap is to move to another company or start their own.
But if we grow to a team of 25, every one of those first five hires can see a clear path to a management role if that’s what they want to pursue. And as the company’s revenue grows, it gives us the fuel we need to provide bonuses, profit-sharing, or equity opportunities to managers who want to move to the next level. In other words, an ambitious young developer could map out an entire, successful, prestigious career path without ever working for anyone else.
Don’t grow for growth’s sake. Don’t even grow for your sake. Grow for your team, so you can give them the opportunity they deserve to build an admirable and enviable career.
2. The magic of location-independence and flexible hours
That said, if you’re used to hiring entirely in-house, there are some assumptions and approaches you’ll need to change to hire and retain great independent contractors. First, you’ll want to focus on remote work, because freelancers highly value their location-independence and time-flexibility. They’re also great at working remotely, and significantly more efficient than a typical in-house employee since they’ve been honing their work-from-home skills for years. Nobody in this group accidentally gets distracted by Netflix or Facebook after lunchtime.
And because they can take advantage of their location-independence to live wherever they want, they can earn extraordinary incomes while charging cost-of-living-adjusted rates that seem reasonable compared to the out-of-control costs of tech hubs like the San Francisco Bay Area and Seattle.
One of my team members, who lives in Toronto, recently asked a question that would flabbergast many employers: “So, do you mind if I work from Germany for a few weeks a year?”
No, I don’t mind.
In fact, I absolutely love it.
Not only does extreme location flexibility mean a huge quality-of-life boost for my team, it’s a competitive advantage that almost no other employer is willing to match. It means my team can weigh working for my company against working for a Silicon Valley powerhouse – and they can honestly decide that the lifestyle benefits of their current job are way better than the big guys can offer.
If you’re set on hiring in-house, you’ll need to be ready to compete with big tech companies – that means a high-end office space, a well-manicured reputation and an acceptance that, despite your best efforts, most of your best hires will move on when a more prestigious opportunity knocks. This approach works for some companies, particularly if you (as the owner) want to aspire to build a Silicon Valley-style workplace downtown in a major city.
If you prefer longevity, consistency, and working with a highly-skilled, widely experienced technology artisan – and you’re cool with granting more flexibility and independence in exchange for those benefits – hiring a high-end independent contractor is your secret weapon.
3. Independent contractors love retainers
I reached an inflection point in the process of building my team when I finally started selling a significant number of retainers – in my case, WordPress Assurance plans that allowed us to cover software updates, security, and support for sites after we built them. These retainers gave me the predictable revenue I needed to justify hiring a high-end web developer as an independent contractor while also committing to a significant amount of work per month – something that pretty much every freelancer craves.
For years, I took the opposite approach – calling on contractors only when they were needed for specific projects, then going dark for months at a time. The result was that I never had a chance to really nurture a relationship with someone who delivered great work – and even if I found a great candidate, they’d need to go pick up more projects as soon as we were done, which meant they’d potentially be unavailable the next time I needed them. This is a pattern I see creative agencies repeating all the time – they spend a ton of time and energy onboarding a developer, have one or two successful projects, then throw up their hands when that person suddenly gets booked out by other clients for months at a time.
Your goal is to be the client who books the best developers for months at a time.
That means building a flow of retainers (or a very steady stream of one-off projects) that allows you to provide your developer with at least 10 hours of work per week. I’ve found that 20 hours per week is the sweet spot since you’re likely to be the developer’s biggest contract, but they also have room to continue to serve other clients if they choose to do so. Your contract is also much more valuable to them because of its long-term, high-volume nature, which means you can agree on a rate that’s less than what they might charge to a client who only needs them for a few hours once a year.
The continuous engagement allows you to build a true relationship with your developer – so even if they’re working as an independent contractor and aren’t physically in your office, they truly become a part of your team, and they begin to share your goal of growing your company and delivering successful projects for your clients.
