At various points in my career, I’ve taken on freelance consulting projects with early-stage tech companies. Unfortunately these arrangements didn’t always end on the best of terms with my clients, because we failed to communicate clearly about the terms of our agreement.
One of my first gigs was with a small online recruiting startup. The compensation we agreed to was a combination of a monthly retainer and a bonus for architecting and signing a partnership with one of the large online job boards. Things started off on the right foot. I knew I should get something in writing before starting the work so I borrowed a freelance agreement template from a consultant I had hired at a previous startup. We signed a three month contract and agreed to revisit at the end of the term.
The three months quickly came and went and things were going well. I had a signed Letter of Intent with a large job board and was making great progress with a few others. I continued to work and assumed because I was still working and reporting on progress that I would continue to get paid per the terms of our original agreement. I also assumed that if the company wasn’t planning to pay me they would let me know.
Not renewing the contract and clarifying the terms was as much my fault as it was the startup’s. It would have been really helpful if both of us were reminded that the contract was ending and prompted to renew.
After about a month and a half, I let the company know that my monthly payment was two weeks late and requested my money. The CEO informed me that we were out of contract and he was not going to pay my monthly retainer. He assumed that I knew this and assumed I was continuing to work solely for the opportunity to close the pending deals I was working on and make my commission.
Not renewing the contract and clarifying the terms was as much my fault as it was the startup’s. It would have been really helpful if both of us were reminded that the contract was ending and prompted to renew. This would have forced the conversation and could have avoided what turned into a very disappointing end to an otherwise positive engagement.
I never did get paid for the extra month and a half of work. It wasn’t worth my time or money to fight it and without a contract I figured I didn’t have much of a case anyway. I chalked this one up to a learning experience and moved on. Hopefully by making it easier to get things in writing we (Shake) can help people avoid these painful lessons.