Pros and Cons of Being a Freelancer on Fiverr

October 18, 2017 Posted by Tyler Cruz

I recently blogged about how I became a freelancer on Fiverr in an attempt to bring in some extra cash to pay the bills. I have been a seller on Fiverr for 1.5 years now and have earned just under $10,000 CAD during that time.

In this post, I will outline the major pros and cons of using Fiverr as a freelancer (seller), in case you’re thinking of joining but are still on the fence.

Hopefully this post can help sway your decision.

Cons

Fiverr’s 20% Commission

Fiverr takes a 20% cut out of each transaction, including tips. I personally feel that this is far too high, especially since they are already double-dipping by charging Buyer’s extra fees on their side as well. I feel it would be better if it was tiered so that higher transactions had a lower percentage cut or was capped. On a $50 order, you will only walk away with $40, which is substantial.

Low Income

Fiverr is called Fiverr for a reason, and that’s because most gigs are $5 (or at least start off at $5). So, after the 20% cut, you’re actually only making $4 per gig.

Even if your gig takes off and you become a level 1 or level 2 seller, the money you make will be amongst the lowest possible methods to earn money from your skill or service. Basically, you will likely not be paid what you “deserve”, or anywhere close to it.

At the Mercy of Fiverr

I am always uncomfortable when I am at the mercy of an overseeing entity like Fiverr. At any time, for any reason, they could decide to shut down my account and then suddenly all the hard work I had spent on building up the gig and clients is thrown out the window. Or, Fiverr itself could simply cease operations and shut down. Or they could decide to raise their commission rates to 30%. I just don’t like having to rely so much on another website.

No Contact Outside of Fiverr

Fiverr has an extremely strict policy about making contact outside of Fiverr. I can understand and even support this, but what it means is that while you are building up a good list of paying clients, you cannot market to them properly, and if you ever leave Fiverr, you’ll never be able to contact them again and take them with you.

Extremely Difficult to Get First Few Gigs

Unlike other crowdsource-based services such as Airbnb or Uber, it is extremely difficult to get a new gig started – nobody wants to take a chance on you when they could easily just hire another seller who has a proven track record with plenty of past glowing reviews.

It took me an entire 10 months before I saw any growth from my gig:

Buyers Can Be Frustrating to Work With

In my gig, I clearly state for buyers to contact me before placing an order, so that I can make sure I have time and the ability to do what they want, and that the price is right. Unfortunately, Fiverr has no option to enforce this, and so I’ll inevitably get buyers place orders, expecting me to deliver them the Mona Lisa for $5-$10. Or, they will place an order and provide no details.

In other cases, buyers will be slow to respond (taking a week at a time), speak poor English, or have you start their project before paying, only to switch to another seller later on.

Pros

Make Some Extra Money

I had listed “Low Income” as a con above, but I’ve listed making money as a pro here as well because the fact is that you can make a decent amount of income on the side.

Is it worth all the work you’re putting in? Are you being paid fairly? Most likely not, but it’s also money you would have otherwise not of had. Fiverr isn’t something you should aspire to work towards out of school, but it’s certainly a great resource if you have a skill and want to make some extra coin on the side.

I made $1,800 a couple of months ago in June 2017. This is not an insignificant amount.

Fiverr Will Send You Paying Customers

Getting paying clients is not easy. In fact, it’s extremely difficult.

Fiverr will send you paying clients left and right. It’s what they do. Are you being underpaid for your services? Most likely, but you’re also getting work.

At the end of the day, making 50% of what you “deserve” is still better than making 100% of nothing.

Tips are Common and Encouraged/Pushed by Fiverr

One perk to using Fiverr is that they encourage buyers to leave sellers a tip (since they will take a 20% commission of that too). Fortunately, buyers tend to tip quite often and are usually fairly generous. I’d estimate that around 60%-75% of my clients leave a tip, usually around the 20% mark. However, I’ve received plenty of large tips – we’re talking about tips upwards of $100.

This helps offset the 20% Fiverr commission.

Don’t Have to Bid to Get Clients

Unlike other freelance websites such as Guru or Upwork, you don’t have to spend your entire day bidding on potential projects (although you can if you want to; they have a marketplace for that). This is the sole reason I’m not a freelancer on those other sites! What a waste of time having to constantly beg for work and being forced to underbid yourself to try to “win” the chance to work.

With Fiverr, Buyers will come to you. You just sit back and wait for a notification e-mail to come in. Simple as that.

Conclusion

Fiverr has plenty of both cons and pros and it will really depend on your personal situation and preferences on whether Fiverr is a good fit for you or not.

You can make some decent side cash with it, but you will be underpaid for what you deliver. If you can handle that fact, then Fiverr can be a great source of extra cash.

Posted: October 18th, 2017 under Miscellaneous 3 Comments

So Just How Broke Did I Get?

October 15, 2017 Posted by Tyler Cruz

I don’t want to write this post. It’s really embarrassing, especially after having had been fairly successful with affiliate marketing and many things that came before that.

But it’s also true, and I have never told a lie on my blog and have always been very open and honest since my blog’s inception 12 years ago.

First, let me tell you how I’m doing now.

Things are still rough. After all, I’m still a homestay host and am still slaving away on Fiverr. It is a struggle to pay the bills and I have no personal savings.

But it was worse before – I at least have a bit of breathing room now in that income is now more or less balancing the living expenses, whereas before breaking even was nowhere in sight.

Here are some of examples of just how broke I got:

Almost Had to Borrow Money From My Parents

I am an extremely “proud” and independent person. I will never take a handout and will refuse help even if I need it and the person offering has no problem doing so.

For example, when I was first looking for an apartment to move out into when I was around 21, my aunt offered to rent me out her rental for 50% of the normal rent. I declined because I don’t like handouts or help from friends or family. I look at it as “cheating” and being a child.

In fact, even when I was still living at home at 19-20, I was paying my parents rent – my own choice – as I wanted to be an adult and didn’t want free handouts. I am the type of person who likes to earn things myself. That way, I can really enjoy things when things go well as I know that I did it all on my own.

I never received a cent from my parents since I stopped getting allowance around the age of 14 or 15 or so (when I got my first job). I never got a car at graduation, never had tuition paid for me, rent paid for me, or money given for a down payment (although I did have my parents temporarily sign as guarantors for my first apartment). My point is that for my whole life I did everything on my own and never got any monetary assistance from anyone – every cent I’ve ever had has always been a result of my own efforts.

And so when I reached the point to where I was so broke that I needed to borrow some money in order to pay the mortgage and bills, I had considered asking my parents for a loan which was the absolute last thing I wanted to do. I never did get to that point, although they knew I was in financial troubles and did offer at one point.

Fortunately, so far I have not needed to ask my parents for a loan, but the very fact that I came close to having to even think about it is something that makes me feel very ashamed.

Almost Downsized House

My girlfriend and I very seriously considered selling our house to downsize to something much smaller and cheaper. We even looked at a lot of properties (online) and ran numbers, and I also contacted my realtor to get his input as well.

We never did this though as the inventory here is so low and the prices so high that we could not get anything “decent” (here’s a case of beggars being choosers). In addition, it is extremely expensive to move (sell, then buy) here so the very process of “moving” would cost well into the tens of thousands of dollars.

This was also a difficult thing to consider as purchasing this house was one of the highlights and accomplishments in my life as it is nice home and was earned by both my girlfriend and me from only our own efforts – no financial aid was given to us.

Took Out Some of My Retirement Savings

I had thought about this for a while, and finally pulled the plug and took out some of my RRSP (retirement savings) just 1 month ago in fact.

For years, I had put money into a retirement savings account on the 1st of every month. I never wanted to touch it until I actually needed it when I was gray and old, but the funny thing is that I ended up needing it now, and so it made sense to take it out. The bank warned me about taking it out, but what good is it to keep for another 35-40 years if I end up having to lose my house, etc.?

While I took  about $5,000 out, I still have quite a fair bit left in there. In addition, my accountant actually advised me against putting money into RRSP. The interest rates are so incredibly low that it doesn’t make much sense to do so, especially when I have two corporations; the main perk to having RRSPs in Canada is to defer the income tax on them, but since I have two corporations, it’s rather pointless to put money into RRSPs as I could just keep the money in the holding company.

Summary

So as you can see, things got very dire. There are a few things I’m leaving out too, mainly my quality of life. For example, I need to go to the optometrist to get my eyes checked and a new prescription, but I don’t have $1,000+ to shell out for new lenses and the check-up.

So I’m most certainly not out of trouble yet – I’m so very broke at the moment. But things were worse even just 4-5 months ago.

It’s a daily struggle, but it will just mean all that much more if I can get myself out of this mess and back up to making good money again. We shall see what happens.

The funny thing is, my net worth is extremely high for my age, but my income over the past few years has been next to nothing.

Posted: October 15th, 2017 under Personal 12 Comments

Airbnb: My Top 10 Tips for Hosts

October 12, 2017 Posted by Tyler Cruz

In my previous Airbnb post, I wrote about the various pros and cons to running an Airbnb listing. If you haven’t yet joined Airbnb and are on the fence, be sure to check that post out as it should give some good insight as to whether it will suit you or not.

In this post, I will share my top 10 tips for being an Airbnb host. As a reminder, I have been a superhost and operate a listing in the summer – a large room in our house. I have not personally hired a maid service so I am not including that here as I only want to provide tips that I have personally done myself.

1. Perfect Your Listing

Think of your listing on Airbnb as one big ad – it is your one chance to attract attention from potential guests and convert them into booked guests.

You should sit down and put in as much effort as it takes to “perfect” your listing. This means having good photos (which is another tip further on), writing an accurate, descriptive, and inviting description, offering a competitive price (do research on your neighbouring listings), and filling out every possible field that you’re allowed to. It is important you don’t oversell your place because while you may convert guests this way, if they are expecting a 5-star resort and arrive to a 2-star dump, you can be sure that they will leave you a bad rating and review.

Airbnb offers a lot of customization for hosts, so take advantage of every one of them. Don’t leave any field or option unchecked. Be honest, too. Do you hate kids? Don’t allow them then. Will you rarely be home or be unlikely to socialize with guests? Mention this. Do you have a bird that is quite ‘talkative’? Be sure to mention this, although write it in a positive light.

You only have one chance to convert guests as they will be unlikely to ever be on the fence; they will either think your listing is perfect for them, or they will quickly hit back and move on.

2. Buy a Digital Lock

One of the best purchases I have ever made was purchasing a digital lock for my front door. I have this Schlage lock which is available on Amazon which costs (at the time of this writing) $180 USD. You never have to worry about keys again, can easily change the combination, offer multiple combinations for different users, etc. It will even automatically lock itself after 30 seconds after shutting the door in case you or your guests forget to lock it.

If you want to spend more money, you can get locks that you can control via the Internet and even get logs of entry/exits, etc. I purchased my lock 2 years ago and haven’t had to change the batteries once, which is amazing since it has a motor inside and is used a LOT since I run a homestay plus an Airbnb.

Even if you don’t run an Airbnb or homestay, I highly recommend upgrading to a digital lock. I can’t live without it now. It’s also very easy to install, only about 10% harder to install than a regular deadbolt.

3. Invest In a Good Bed and Sheets

As a guy, I didn’t realize how important this was at first. After all, I’m no Martha Stewart. But you’re running a bed and breakfast for God’s sake, and people are booking your place so that they have a place to sleep.

I made a HUGE mistake when I first got my listing ready, and that was purchasing a brand new bed and frame… for a DOUBLE (Americans call it a ‘full’ I think)! I have absolutely no idea what I was thinking, apart from probably justifying it with the price. Plus, a double looks plenty big when you’re at the store… and it’s not for me so it should probably do, right? Well sure, it might suffice – after all I’ve had not a single complaining about it so far and a 5-star rating, but if you’re spending $500 for a new double, you might as well spend another $75-100 and get the queen, or if you have adequate room, spend the $150-$200 more and get the king.

We easily had room for a king but I got the double! Stupid, stupid, mistake.

In addition to the bed itself, be sure to splurge on quality linens, bedding, and pillows. Guests will notice the difference.

4. Communicate Well

Avoiding misunderstandings and maintaining a 5-star rating requires good communication. This means contacting your guests BEFORE they arrive and asking if there’s anything they need and perhaps tactfully finding out why they are coming. For example, if somebody is coming for a funeral you may want to hide the champagne glasses and replace them with extra boxes of kleenex and a greeting card.

Find out what time your guests expect to be arriving so that you can make sure you’re available to let them in. Have your phone ready hours before they arrive in case they need to contact you for directions or to let you know that they will be arriving late or early.

You will also be getting guests from all over the world, and some will not speak very good English (some will barely speak any at all), so it is doubly important to communicate clearly.

5. Take Very Good yet Accurate Photos

For a while, Airbnb was offering free professional photography services by local photographers in your area to take photos of your listing. Why did they do this? Because they know how important photos are to convert guests to make a booking. While I don’t think they offer this anymore (I could be wrong), it doesn’t mean you can’t hire somebody yourself – although this isn’t necessary.

What is important is that you take very good photos of your listing from multiple angles, and don’t skimp on the photos (but don’t overload them with photos either – avoid having the same portion shown in multiple shots). At the same time, make sure that the photos are a realistic representation of what your guests can expect when they arrive. We all know the comparison to online dating when people have a photo showing them as young and attractive, only to show up as an obese 50-year-old.

It’s fine to Photoshop your images to improve the lighting and whatnot, but make sure guests won’t be disappointed when they arrive.

6. Write a Guidebook

I wrote a guidebook in Word, printed it out and placed it in plastic sleeves, then placed them into a binder. I put an Airbnb label on the front and I place this binder on the coffee table in the listing.

It is about 14-15 pages long and starts off with the essential information they need to know such as house rules, the wi-fi password, the code to the front door (see the digital lock tip mentioned earlier), and what time we offer breakfast to. It then has recommendations to local restaurants we enjoy with their address, website and phone number, then recommended attractions.

This not only is a great resource for guests, but also saves me time as when I’m showing them the tour I often just point to the book and say “it’s in the guidebook”. You only have to make this once so it’s definitely worth doing.

7. Don’t Accept Guests Without Any Reviews

Airbnb actually encourages hosts to give new guests a chance, but of course they would say that as they would then have a new customer.

I’ve only ever accepted a guest without any reviews once, and that was my very first guest. Since I was a brand new host, beggars can’t be choosers and it was only fair. But I will NEVER accept guests without 100% perfect past reviews. There’s simply no point – it’s too much risk.

First-time guests may not understand how Airbnb works and expect you to clean their room everyday, or don’t understand boundaries, etc. Or they could just be horrible guests – who knows, since they’ve never been rated before.

And obviously never accept anyone that has had anything but 5 stars.

8. Overdeliver

You are running an Airbnb to make money. I get it, trust me. But what’s more important than receiving your money? Your rating, because without a 5-star rating, you will not get any more bookings, and that means no more money.

In order to protect your 5-star rating, you need to overdeliver. Give your guests an experience that exceeds their expectations. Could you charge 10% more a night for your listing? Probably. But should you? In my opinion, it’s not worth trying to squeeze out every last penny you can get if it means a higher risk of losing a star.

Little things can do a lot. For example, I buy little champagne bottles and put out glasses for our guests – this isn’t mentioned in the listing, so it’s a nice surprise for them which they always appreciate. One time we had a dog come with guests and I put out doggy treats and doggy bags for them – this cost me maybe $0.50 (I already own a dog) but they loved it and it made their stay from that simple gesture.

9. Make Sure You Have Time to Clean

I actually block off the day before and after bookings (this is an option within Airbnb that automatically blocks these days off on your calendar) so that we have adequate time to clean the unit. Otherwise, it’s too much of a time crunch. For example, if your checkout time is 12pm and your check-in time is 1pm, that only leaves you 1 hour to completely turn over the listing – that’s not enough time to clean the bathroom, vacuum, wipe things down, etc. not to even mention the laundry which will easily take hours since you will have multiple loads.

You could set your check in and out times further apart, but even then you’d only have 3-4 hours and sometimes guests arrive early so it’s still a time crunch.

If you do allow back-to-back bookings, just be 100% sure you can clean it properly in time. If you do this, you will likely want to buy 2 of everything so that you can just swap dirty towels for clean ones, dirty bedding for clean ones, etc.

10. Give a Proper Greeting and Tour

When guests arrive, I always greet them with a hearty welcome and handshake, and even offer to help them with their luggage if they’re female or older. I am enthusiastic and smiling and ask them how their trip is going and what they have planned.

I show them their room and ask them if they have any questions, then offer them a tour of the rest of the house. This process generally only takes about 10-minutes, but in my opinion it is a very important process. First impressions count for a lot, and doing this will also eliminate many potential issues later on since you’ve already covered them during your tour. For example, I make sure guests are aware to close the kitchen door when they are eating so that our dog doesn’t steal their food or beg from them.

I hope at least one of these tips can benefit you in your Airbnb adventures!

Posted: October 12th, 2017 under Miscellaneous No Comments

So What the Hell Happened? Part 5 of 5: Fiverr!

October 9, 2017 Posted by Tyler Cruz

You’ve made it to the final post in my “So What the Hell Happened?” series. So far I covered: how my online income dwindled to nothing while struggling with serious medical issues, my dog sitting business, becoming a homestay host and looking after international students, and running an Airbnb.

In this last post of the series, I will talk about my adventures on Fiverr, the freelance site where you can sell your soul for $5 a pop.

That’s right! I resorted to freelancing! Me! In fact, I was so ashamed and embarrassed that I make an account with a fake name and image in order to hide my true identity. There was a benefit to this that I will touch on later though.

When I registered on Fiverr as a freelancer, I didn’t know what would happen. All I knew was that I was still broke and needed to find another way to bring in more cash to pay the bills. I figured my chances of making anything were small, but also knew I had nothing to lose. I had used Fiverr as a buyer before, so I was already familiar with it.

Starting Out

I chose a gig that seemed like it had a decent amount of demand for, that I actually enjoyed doing, and that I was half decent at but by no means an expert or even close to one. My gig will remain private as I don’t want a hundred people trying to copy me exactly

I spent a fairly long time on my gig’s description, username, avatar, and packages, and I set my price to a flat $5. I would cover most types of work for that $5, only raising it to $10 or $15 if the job was very difficult. I also offered a 100% satisfaction guarantee – if they weren’t satisfied I wouldn’t charge them.

In the beginning, I would often spend 6-8 work hours to complete a $5 gig. Sometimes I’d spend 2-3 days. I remember one time I spent a week working on a big project for a client (for like $10-$15) and in the end, after working all day and night for a week, he backed out because he thought I was nickle and diming him as he thought it was only worth $5.

So why did I slave away at prison-level wages?

Simple – my goal wasn’t to make money at that point, but to build up my reviews. The hardest thing when started out as a freelancer, or any review or rating-based service or medium, is to build up your number of reviews. It’s a chicken and the egg scenario – you need reviews to get work, but nobody will hire you because you have no reviews.

I needed to give people a reason to take a chance on me, and that reason was super cheap work (low risk for them), and a money back guarantee. My delivered product was also of the utmost quality, but they wouldn’t know that until they received it.

Fiverr’s Fee

Fiverr double-dips in that they take a 20% cut from the seller, and then also charge extra fees to the seller on top of that. I find this pretty greedy and the 20% is really a huge cut (on a $30 order you’ll only receive $24), but at the same time they are sending you paying clients, which is not to be underrated.

It would be nice if they changed the scale at which they took their commission though, so perhaps on orders of $50-$100 they take a 15% cut, a 10% cut on $100-$300, etc. Because it makes it difficult to make higher-priced services as they are always taking the same margin; a $500 order only actually leaves you with $400, for example.

The Grind

I continued to slave away on Fiverr, selling my soul $5 at a time. I would only take on jobs that I knew I could make the client 100% satisfied.

For the first 10 months of being a seller (freelancer) on Fiverr, I averaged around $2-3 per day or around $40-$50 a month. I kept at it though, as my reviews were building over time, and I did notice things to very slowly pick up. At the same time, I was improving my skill in my chosen gig and could take on more complex and involved work.

Around this time, I also was promoted to a Level 1 seller (from a New Seller) which really motivated me to push on.

Two months later, my daily average shot up to $15/day. Suddenly, in my local currency, I was making about $450 a month – and this is AFTER Fiverr’s commission.

As I did more and more gigs, I would get repeat clients which really helped to increase my number of reviews. Things continued to skyrocket, and in February 2017 I averaged $28.40 per day, yielding me with $800 in profit (CAD currency; $631 in USD).

Where I Am Now

In June 2017 I ended up making $1,801 profit (CAD), which works out to $60 per day.

I’ll be honest and say that I was very happy. I was also very proud. It was not an easy road, to climb up from the very bottom like that and to stick with it.

I am now a Level 2 Seller (and have been for quite a while), and am waiting for Fiverr to one day upgrade me to the highest level, a top-rated seller. To get to that rank, you have to be hand-picked from Fiverr staff, so there’s no metrics I can hit to achieve that designation and just have to wait and hope I get promoted. If I can become a top-rated seller, it will help me get more orders and I’ll be able to raise my price slightly.

My clients love me and I have a 100% perfect rating:

 

In fact, I’d say a good 60% of my clients end up as repeat customers:

My most frequent clients.

My clients are so happy that most will tip me and are quite generous with their tips (I have found Australians to be the best clients overall). I’ve had tips as high as $100!

While June 2017 was my best month on Fiverr yet, things plummeted dramatically in July, which brought in an average of only $12.38 per day. I am not too disappointed about this though as it was due to a number of factors.

First, as I was getting so many orders in June, I became so busy that I had to throttle them down by increasing my prices. This slowed down the amount of orders I was getting. In addition, I turned down a bunch of jobs because I was too busy with other things to do them at the time. Plus, it was just a slow month – it happens.

What’s important is that there appears to be a trend of growth over time. Here’s a graph charting my monthly profits over time (as of August 2nd):

Quite the jump over the first year.

And here is the daily average profit (in CAD) over time. Again, this was as of August 2nd, so the August daily average will obviously drop later on 🙂

I am at top of my gig’s category, as well as at the top for my gig’s search keywords.

Here is a monthly breakdown of my Fiverr earnings (including some jobs I got from my website for the same service). Longtime readers of my blog should appreciate it for historical reasons 🙂

This was as of August 2nd, 2017

Trying to Get Clients Outside of Fiverr

Because of Fiverr’s fee and the fact that I don’t like living with the possibly (albeit unlikely) threat that Fiverr could at any time ban my account, or raise their commission rates, etc., I created a website for my gig’s services in the hopes of getting clients through that and offering the same service, but without the 20% commission.

I ran some Facebook and AdWords traffic, but they did not pan out; the AdWords traffic was insanely expensive for my needed keywords – I don’t know how other advertisers can afford to pay such high rates in this niche and still profit. I will give it continued attempts every once in a while.

Goals

I would like to triple what I’m currently doing  with Fiverr. That is, to average around $150 a day, or $4,500 a month.

This is enough for me to comfortably live on, and anything above that would allow me to save money for another real estate investment.

It is not an easy feat to do, but it’s certainly possible, especially if you look at how much I grew from the first year.

This Is a True Case Study

What’s cool about this is that it’s a true case study of being able to make money with Fiverr. As mentioned in the beginning of this post, I used a fake name and avatar when I signed up, and nobody knows my account on Fiverr. I have not advertised my services on my blog or anywhere.

This means that if you’re looking to make extra cash, you can certainly do it as a seller on Fiverr.

I have made money online so many different ways since the early 2000’s, and this is just one more way to do it. Does it pay as much as a normal job? No. Not yet, anyway. Maybe check back with me in a year.

But if you’re looking to make $250-$500 a month online from home, being a seller on Fiverr is one of the easiest ways of doing it.

More Fiverr Posts Coming Soon

Since I’m pretty sure that you guys will want to know more about my Fiverr adventures, I have the following posts scheduled: Pros and Cons to Using Fiverr, Fiverr Buyer Tips, Fiverr Seller Tips – so stay tuned for those posts.

Posted: October 9th, 2017 under Miscellaneous 6 Comments