How to Retain the Best Freelancer Talent While Building a Real Business If you can't afford a full time team, you really can't afford to alienate your freelancers.

As a startup or an established business, you may have already discovered the multiple benefits of hiring freelancers over full-time employees. It's actually a win-win situation. You can tap talent on-demand without overhead costs like insurance, paid vacation and sick time. This is especially beneficial when you're not sure where your business will be in the next 60 days. Freelance talent enjoys a flexible work schedule that they set. This allows them to create a lifestyle that suits their needs.

Freelancers number into the millions across the country. When you find the best freelancer talent that aligns with your business needs, you don't want to lose them. It's hard to find an amazing worker who gets your business. Keep in mind, your competition wants these exact people. Yet, according to research, many organizations focus on hiring and don't do much after they have found the talent to actually make them want to stay. This is the same for employees as it is for freelancers.

My business runs like a well-oiled machine because I have a team of reliable freelancers. It's the only way I've been able to scale my business in the way I need to grow. That's why I do everything I can to retain them. Here's what has helped me to retain some of the most amazing freelancer talent over the course of the last few years:

Recognize their value by paying them accordingly.

There are many companies out there that still believe that freelancers can be paid less than their traditional employee counterparts. In reality, they are already making less. They have to pay their own costs such as healthcare, office and supplies and retirement savings, not to mention the time in between gigs when they aren't being paid.

When I started out, I paid freelancers what I thought they were worth... which was very little. I didn't give weight to the expertise they had. I just thought, "hey, they are worth this much and that's what I can pay." I ran my numbers and said an employee was worth so much, so they are worth much less. I couldn't have been more wrong. I churned through freelancers weekly.

Years later, once I figured out how the freelancer economy works, things took a turn for the better. I first looked into the going rates for the type of freelancers I wanted to add to my team. Since I still didn't have a lot, I was honest with what I could pay and used them sparingly to not take advantage. Some freelancers willingly took slightly less because they saw potential to grow with me. As soon as it was financially possible, I raised their rates to the competitive amount. Over time, as their skills, knowledge and expertise increased, I compensated them for that. I now have several earning nearly double what their employee friends are making.... and it's totally worth it on my side.

Pro Tip: While you can negotiate with freelancers, don't ever low ball them. The result will be either low-quality work or the loss of that talented freelancer. Freelancers have a tight, supportive network. They regularly exchange information on companies that pay fairly and those that don't. You don't want to end up on their "list of low payers" because you'll never get talented freelancers to come work with you.

Deliver payment on time.

Freelancers deserve to get their money on a schedule, just like a traditional employee. Shamefully, many companies believe it is okay to let payments slide. Some even go to net 30 or net 60 terms, delaying days or months before paying. This frustrates your talented freelancers who rely on steady cash flow. They don't want to worry about whether they will get paid and they don't want to spend time sending payment reminders.

Instead of seeing how long I could stretch my own cash flow, I have always first paid those who help directly or indirectly generate the revenue and profitability for my business. From there, it was my other bills and finally, if anything was left, me. I use a regular system where I pay on the first and 15th of every month. It also sets expectations on both sides and helps everyone stay on the same page.

Pro Tip: Work with the freelancer on using an online invoicing and online payments system that facilitates this timely payment delivery.

Related: 5 Tips for Hiring Freelancers Who Will Boost Your Business

Establish expectations and agreements.

Professional freelancers like to know where they stand with clients. They want a formal framework in place that covers expectations about work, payment, pay rate and other important aspects of working together. It provides stability and lets that talented freelancer know you have a long-term picture that includes them. They feel confident about what they are doing and don't have to focus on those other details.

For me, it's important to have these agreements in place and share expectations right out the gate. It answers many questions that every freelancer has that has come on board, which saves me time and puts their minds at ease.

Pro Tip: You can find agreement templates and examples online that outline all the legal requirements about things like proprietary information, confidentiality, work ownership, non-compete agreements and termination. These agreements also show what you will do to help the freelancer so they know what to expect related to workload, delivery dates, and long-term prospects.

Related: Employers Are Paying Freelancers Big Bucks for These 25 In-Demand Skills

Provide consistent flow of interesting work.

The best way to retain a talented freelancer is to keep them so busy that they won't even think about going anywhere. A bored freelancer will start searching sites for new projects. While all freelancers are unique, most are drawn to this type of work because they like working on many different things at once rather than do the same job, day in, day out, for the same company.

This regular workflow also helps a freelancer to relax and just focus on what they are good at. While they still have to regularly search out possible new gigs just to ensure they achieve a minimum amount of money each month, they won't be stressed out.

Pro Tip: With a busy schedule, I sometimes find that I can lose track and not realize that a freelancer may have run out of projects. I started using online spreadsheets to track what each freelancer had on their plate so I would know when I should top it up. This has helped my freelance team to continue to work at the speed they like.

Related: 25 Payment Tools for Small Businesses, Freelancers and Startups

Gradually increase their role and responsibilities.

As part of this flow of interesting work, another way to retain freelancers is to give them a larger role in your company as you build it out or as you develop a professional relationship with them. Nothing reassures them that there is enough opportunity to stay like new challenges with additional responsibilities.

Find out what they would like to learn or be interested in doing on top of what they already do. I often ask what else they may want to do for me or if they have ever used a particular skill. If they haven't but want to learn, then I review it with them by phone to make sure they understand. Then, I give them a trial assignment. Depending on how it goes, I'll either spend more time helping them or start assigning more tasks related to that new responsibility. I always tell them I know they can do it or I would have never asked them.

Pro Tip: Make sure that what you add to each freelancer's role is something you feel comfortable delegating. On certain platforms, there are usernames and passwords that are required. I've solved this by using Portadi, which allows me to make certain platforms available for freelancers without revealing that confidential information. That maintains trust and allows me to expand their role.

Related: The IRS Wants to Know If Your Freelancer Should Be Getting a W2

Communicate frequently

Since freelancers work remotely, they want regular conversations to know what's going on, your ongoing expectations and how they are doing. They are not looking to be micro-managed or placated, and I certainly wouldn't want to do either of those. However, encouraging words and regular check-ins make them feel part of the company and its culture.

However, as I got busier and trusted that they could handle it, I would get sucked into my daily calendar and there would be periods of "out of sight, out of mind." Scheduling these conversations helped me balance my own responsibilities with the need to communicate frequently.

Pro Tip: I add every one of my freelancers to Slack so that they have instant communication with me. This helps them express their questions quickly and allows me to answer nearly as fast. They also can reach out to other team members who can handle tech issues or other areas that don't necessarily require my assistance.

Related: The Secret to Transitioning from Freelancer to Entrepreneur

Show an interest in them.

Besides just talking with them about work, it's important to get to know them a bit more while maintaining a professional distance. When you ask questions about how they are doing or how they spend their other time, it makes them feel closer to you and also shows the possibility of a longer term relationship. Obviously, you don't want to ask too many personal questions. Instead, let them know they are open to sharing information about their family and social plans, hobbies or anything else that interests them. Be aware that you can then bring up a question during ongoing conversations

Pro Tip: It's little things like that where the freelancer realizes you are paying attention to them as people and care about them as individuals. For example, when one member of my freelance team posted on social media about her fitness program progress, I got her a pair of running shoes I saw on her Amazon gift list and sent her a card to cheer her on. For another freelancer, I wrote a recommendation letter for a board position.

Related: The Beauty of Freelancing Until You Hit the Big Time

Respect their desire for flexibility.

Provide the space to enjoy the flexibility of being a freelancer. That means recognizing that they do have a life outside of work even though they sometimes are happy to work over a weekend with you on a project or end up sending you complete work around midnight. As long as they are meeting deadlines, let them disappear in the middle of the day to take care of something on their schedule.

Allowing them that balance reduces their stress and any associated guilt for disappearing to take a gym break from work or recharge their mental batteries by watching their child's sporting event.

Pro Tip: It helps to provide specific deadlines for all projects so that freelancers know that they can plan those events and workflow to synch. The last thing you want to do is stress a freelancer out who didn't realize you wanted something yesterday but forgot to tell them.

Related: 6 Times I Wished I Hadn't Quit My Corporate Job -- and What I Did About It

Understand they must diversify.

If you want to be the only client for that talented freelancer, hire them full time. The reality may be that you can't because you are still growing. Because freelancers have less job stability than traditional employees, it's in their best interests to diversify and have a portfolio of clients to serve. That way, if something unexpected happens and they lose a client, they still have income. To retain that talent, it's important to appreciate that about their situation rather than getting jealous or becoming clingy with their time.

Pro Tip: Having been in the same position and losing big by not diversifying, I totally get where they are coming from and encourage them to do so. What I have found helps is to refer them to colleagues and actually get them other assignments. This shows them I am encouraging their success and doing them an important favor that is sure to win their loyalty.

Related: 5 Steps to Finding Stability as a Freelancer

Always say, 'thank you.'

The last strategy is actually the simplest. Just showing appreciation and regularly saying thanks makes a huge difference. Freelancers are trying to make a living but also want to be valued for what they do.

Pro Tip: I always tell freelancers "thank you" on the payment notification they get on their online invoices. Plus, I make sure to tell them on a regular basis how much they rock. And, when there are those days where I'm "cracking the whip" because we need to get a lot done as a team, I end the day with a personal note of thanks.

The Rewards

Not all these strategies for retaining freelance talent cost you money. The time you put into them will provide a definite return in the form of a highly skilled workforce. All they expect is decent and timely pay, good communication, challenging and consistent work, and the sense that they are part of something.