Why Enterprise Companies and Freelancers Need Each Other

This blog summarizes learnings from The Future is Freelance Forums. In this collaborative events series, stakeholders from all levels of the freelance ecosystem (freelancers, agency leaders, coaches, platform CEOs, enterprise leaders, etc.) come together to surface and solve the biggest problems facing independent work. These summaries will house our collective wisdom on these topics. As such, I want to credit everyone who attended this forum for these insights.

In the evolving world of work, enterprise companies and freelancers are increasingly indispensable to one another. However, the dynamics of this relationship are not without challenges. By understanding the barriers and opportunities in this space, enterprises and freelancers can create a symbiotic relationship that drives value for all stakeholders.

What are the barriers to flexible workforce adoption for larger enterprise companies?

What are the barriers for freelancers to find work with larger companies?

How can the freelance ecosystem address this divide to ensure the growth of the freelance economy?

We set out to think about these questions as a collective, and here’s what we learned.

Bureaucracy vs. Autonomy

Freelancing as a concept represents one of the most independent, nimble, and flexible ways to work. That inherent autonomy means freelancers can feel like square pegs in round holes when trying to penetrate most enterprise companies' intrinsic bureaucracy.

One key advantage of working with freelancers is the ability to tap into targeted expertise, speed, and project-based flexibility. Yet enterprise procurement processes, security measures, and regulatory frameworks often counter these benefits.

This disconnect creates inefficiencies and delays, reducing the impact of engaging independent talent. A common frustration for freelancers and hiring managers is when the timeline for a project doesn’t align with the red tape for hiring a freelancer. This red tape can deter even the most experienced freelancers, who in many cases can find work elsewhere with a lower barrier to entry. On the hiring side, the hurdles often mean that it is easier to find someone in-house to do the work, even if there’s limited capacity and expertise.

The Middleman Challenge

This bureaucratic mismatch between freelancers and companies has been addressed by a variety of “middleman” solutions, from platforms to agencies to internal marketplaces. These intermediaries help align the needs of enterprises and freelancers while ensuring compliance with legal and regulatory requirements.

While agencies, platforms, and other intermediaries have been crucial in connecting freelancers with companies, there are drawbacks: agencies and platforms often take a sizable cut, leading to inflated costs for the enterprise and reduced earnings for the freelancer. While these middlemen play a crucial role in breaking down barriers by helping freelancers and hiring managers navigate the maze of regulations, expectations, and administrative hurdles, their involvement can sometimes hinder direct collaboration, transparency, efficiency.

Many large companies have also created internal freelancer platforms to integrate independent talent into their operations. Some of these platforms function more effectively than others; on the one ha,nd they can be an effective way of posting internal projects for freelancers on the other hand they can be bureaucratic holding pens for projects and jobs that may already never see the light of day. These internal marketplaces can streamline the hiring process for managers while giving freelancers direct access to high-quality projects—a win-win, in theory. However, the execution can leave much to be desired due to inefficiencies and lack of clarity in how these platforms operate.

A Two-Sided Solution

Effectively leveraging freelance talent requires a fundamental shift in corporate culture and for freelancers to step up to the plate as legitimate businesses. Those who are prepared to rise to this challenge on both sides and positioned to take advantage of a huge market opportunity.

Enterprises must move beyond viewing freelancers as external, ad hoc contributors and instead treat them as strategic partners who bring unique expertise. Their internal processes, strategy, and implementation have to reflect this shift by fostering clearer communication, defining project scopes, and streamlining onboarding processes.

Freelancers also have room to grow. For hiring managers, the distinction between hiring a person and contracting with a business is often unclear. Freelancers operating with legal business entities, such as LLCs or S-corps in the U.S., enjoy a lower barrier to entry when engaging with enterprise companies and make this distinction easier for those hiring them. These formal structures simplify procurement processes, making it easier for both parties to comply with regulations. Additionally, they signal professionalism and readiness to handle complex projects.

Clarifying this difference is vital to avoid misalignment in expectations. Enterprises must understand that freelancers are businesses in their own right, offering services rather than seeking traditional employment. Similarly, freelancers must present themselves as legitimate solo businesses to ensure they are treated as independent professionals.

Freelancers who put in the work to successfully navigate procurement processes and achieve approved vendor status are uniquely positioned for more work within a company. As known entities within an enterprise, these freelancers can leverage their relationships for additional work and new opportunities. For hiring managers, working with such freelancers offers security and continuity, as they are familiar with the company’s expectations and processes.

Even with these changes, misclassification remains a significant issue with the distinction between contractors and employees becoming blurred. For enterprises, this misunderstanding can lead to regulatory complications and financial penalties. For freelancers, unclear expectations often result in situations where they feel like proxy employees, with less autonomy and undefined scopes of work.

Both sides have to embrace a new paradigm in order to prevent misclassification with enterprise leaders understanding the different between freelance, temp, and full-time talent and freelancers positioning themselves as solo busineses and owning their scopes, deliverables, and boundaries.

A Partnership for the Future

In conclusion, the evolving partnership between enterprises and freelancers represents a powerful opportunity to redefine the future of work. However, this potential can only be unlocked by addressing the challenges on both sides—streamlining enterprise processes, fostering a cultural shift to view freelancers as strategic partners, and empowering freelancers to operate as legitimate, professional businesses.

By breaking down bureaucratic barriers, improving clarity in expectations, and embracing innovative solutions like streamlined procurement processes and well-executed internal platforms, enterprises can fully harness the agility and expertise that freelancers bring. Similarly, freelancers who invest in their business operations and positioning will be better equipped to master tthis evolving landscape.

Ultimately, the future of the freelance economy depends on this two-sided collaboration. With mutual understanding, adaptability, and a shared commitment to creating value, enterprises and freelancers can build a symbiotic relationship that drives innovation, efficiency, and success for all. The freelance ecosystem isn’t just a trend—it’s a cornerstone of the modern workforce, and its growth requires collective effort to overcome existing divides.

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