It’s probably obvious, but let’s start by saying why it is a bad idea to take on free clients.
- One, you won’t make any money—>which is, of course, an essential outcome of any business. Even taking on a handful of free clients alongside paying ones (aside from raising questions of justice) will dilute your energy for no monetary outcome.
- Two, it diminishes the value. Peoples’ first reaction to a free good is often, what’s wrong with it? Even if nothing is wrong with it, people will never value a product more than we ourselves value it. And perhaps most importantly, clients must be invested in your product for it to work; nothing cultivates a sense of investment more than a sacrifice, monetary or otherwise.
- It slows your business growth. Until you find clients willing to pay for your services, you will never know if you have a viable business model.
Is there ever a time to take on non-paying clients?
Yes, we believe so. But it needs to be done purposefully, cautiously and on a limited basis. We call them Beta-clients; their value is not in money, but rather in their feedback, testing your offerings, getting referrals and boosting early stage entrepreneur’s confidence.
When you are just starting out, it can be difficult to market your product at full value, because you know it isn’t perfect yet (which doesn’t actually matter), but this will affect your confidence and pricing, which does matter! It will hurt your sales.
This is why it can be a good idea to take on Beta clients—recruiting them with the understanding that your product is not yet perfect and you are relying on them for feedback and testimonials to help get your product off the ground.
[TIP: Whom you select as a Beta-client is important. It is tempting to use family and friends, but this is not a good idea. You want someone who is unbiased. You also want someone who is part of your target market, which your friends and family may or may not be. But you do want someone who will be thorough, honest, and invested; ultimately, using a Beta-client is about creating a relationship of mutual help. The client gets to use your product, but will also work closely with you to improve it. It may be a good idea to create an application for prospective Beta clients, to ensure that people are truly interested in your product and to assess the level of detail and care they take in the application.]
Limit your free clients!
It is very important to limit the number of Beta clients you use, we notice so many entrepreneurs giving away their services for free. Don’t do this!
Two beta clients are a reasonable number for a start-up entrepreneur. This will allow you to focus your energy on delivering the best version of your product, pay thorough attention to the feedback, and go on to feel confident about selling your product at full value.
Here is a cheat sheet to help you recruit useful beta-clients: