Dave Ebbelaar

How to Start Freelancing as an Engineer (Contracts vs Projects)

Published 2026-10-10 · Duration 18:07

Summary

The video outlines the optimal freelance model for engineers, arguing that success requires combining long-term contracts (for stability and high revenue) with smaller, project-based work, and establishing recurring maintenance retainers. For build engineers, the focus should be on leveraging AI for back-office automation in small to medium-sized enterprises (SMBs) and developing proprietary software to build intellectual property (IP).

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Key takeaways

  1. Two Freelance Models

    Long-term contracts are similar to full-time roles (AI/Software/Data Engineering), paid hourly/day rate, and typically secured via recruiters. Project-based work involves fixed-price, smaller scopes (e.g., building an AI assistant for a fixed price over two weeks).

  2. Revenue Source Focus 4:10

    The speaker claims that 80% of revenue for full-time freelance tech professionals comes from long-term contracts and establishing relationships with enterprises, not from small, single-project gigs.

  3. Targeting SMBs for Projects 6:04

    For solo project-based work, focus on small to medium-sized enterprises (SMBs) (up to ~200 employees). The opportunity lies in automating 'boring stuff' that every company needs, such as invoices, emails, data entry, and reporting.

  4. The Optimal Freelance Strategy

    The most successful freelancers combine long-term contracts, stack smaller projects on top, and implement maintenance retainers. This combination allows for continuous revenue and the development of proprietary software (IP).

Technical details

  • AI/ML Engineering Roles 423s

    In 2026, high-demand roles include AI Engineering (integrating LLM features into existing products), building pipelines that feed AI, and advanced concepts like Retrieval-Augmented Generation (RAG), multi-agent systems, and evaluation.

  • Back-Office Automation 364s

    This involves automating digital artifacts (invoices, emails, documents, phone calls) that flow through a company. Solutions can be trigger-based or webhook-based, utilizing assistants (e.g., Claude, Codex) connected to CRMs, ERPs, or ticketing systems.

  • Implementation Architecture 702s

    Automation often requires a custom backend (e.g., Python) deployed on a Virtual Private Server (VPS) for background jobs. On-demand work can be solved by custom Multi-Channel Platform (MCP) servers and specialized skills.

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