If time is money in business, it should never be given away for free, right? Not necessarily. Let’s go over when you should work for free and when you shouldn’t.
Work For Free: Useful Skills And Experience
Most workers have experienced the Catch-22 of venturing into a new industry for the first time: You need the experience to get a job but can’t gain experience without a job. It’s the same in business.
It’s hard to make a case to customers or clients to choose your products or services if you don’t have skills or experience to back it up. Doing free work allows you to get around this dilemma and gain the experience you need. This way, you can perfect and launch your product or service and attract desired customers or clients.
Don’t Work For Free: Doesn’t Lead to Paid Work Eventually
Make sure you quickly move on to paid work once you gain confidence in your skills and experience. If the tools you will gain from doing free work aren’t of value in your specific business niche, think twice before doing free work. Your time would be better spent cultivating relevant skills elsewhere.
Work For Free: Valuable Exposure
The keyword here is “valuable.” Both budding and broke businesses alike may promise their hires exposure in exchange for free work. But you should assess whether the exposure you will gain from that business will be useful to your career.
Consider where you are in your business career. If you’re a new business owner without a reputation or an established business owner looking to scale up, exposure may be valuable. It all depends on who and how many will be exposed to your name and work.
The exposure could land you more or higher quality customers or clients if the free work will get your name in front of your target base.
Don’t Work For Free: Exposure Isn’t Relevant
Think twice before working for free if the business you’re working with to gain exposure doesn’t have an audience. The same applies if the audience doesn’t reach the target base you want your business offering to reach.
For example, let’s say you’re a web designer. You agree to create a free website for a magazine in exchange for a free ad in that magazine. If the magazine is targeted toward construction professionals, it may not give your business the PR boost you hoped for.
Work For Free: You Believe In the Business
Requests for free work are relatively common when dealing with start-up businesses with minimal capital. But these requests are easier to digest when they come from start-ups with a unique business offering. It also helps if the leadership team has successfully gotten businesses off the ground in the past.
These attributes in a business can give you financial peace of mind. Even though you won’t get paid now, the business team may have the background needed to drive results and pay you in the future.
Don’t Work For Free: No Faith In the Business
Working for free requires much more than bare-minimum enthusiasm for the business you’re working with. If you don’t believe in the business’s leadership or product offering, working for free isn’t a good idea. The regret of not being paid will only worsen as you progress in the business relationship.
Work For Free: Money Isn’t Everything
In the legal profession, cases are often taken up by attorneys on a pro bono basis for altruistic reasons. The same is true in other business niches. If you’re in it to help out a fellow business, the goodwill you will generate from doing free work for that business might outweigh the lack of income.
Don’t Work for Free: Money is Still Very Important
Compensation isn’t the only reason for going into business. But it’s a primary motivation for many entrepreneurs. It might be that you feel h2ly that you should be compensated for all your work. Or, you might not be able to afford to work for free. If this describes you, you should freely decline unpaid work.
If you don’t want to do free work, you can instead work for a nominal fee rather than none at all.
MileIQ’s blog does not constitute professional tax advice. You should contact your own tax professional to discuss your situation.