10x Management on Getting Better Payment Terms for the Best Talent

In the world of gig work and freelancing, finding jobs and getting paid can almost be a job in itself.

This is where companies such as 10x Management come in. Company Co-Founder Rishon Blumberg said he started out providing management services to music-industry performers in the 1990s and now provides a comparable service to technology talent.

“We represent senior tech freelancers, and we represent them over the long haul,” Blumberg told PYMNTS in an interview. “Much the same way that Tom Cruise or Bruce Springsteen has an agent, we act as the agent for the tech talent.”

The agency assists clients with everything from finding work to drafting contracts. It also handles such tasks as payroll, acting as an intermediary that makes certain that its talents’ pay is consistent and timely. That requires maintaining several choices for disbursing payments, from digital options, such as Zelle and Wise, to more traditional methods, such as automated clearing house (ACH) and wire transfers.

“For the talent, our clients, we’re really trying to take the business elements off their plates,” Blumberg said.

That encompasses a significant number of tasks, from sourcing work and sifting through opportunities appropriate to a client’s experience and abilities, to making certain compensation fits the assignment and payment terms are reasonable. 10x also handles client invoicing.

“We help ensure that [clients] get paid what they should get paid,” Blumberg noted.

Getting the Best Talent

Blumberg explained that the talent 10x works with are all senior-level tech specialists who are pre-vetted. That provides a value proposition to the companies seeking freelancers through 10x, but it also means those freelancers are in high demand. If a company cannot provide reasonable terms for compensation, those freelancers will have no problem finding work elsewhere.

The companies that work with 10x appear to understand that. Blumberg estimated that only around 15% to 20% of payments are ever late, and it is extremely rare for them to be delayed beyond a couple of days. Additionally, the freelancing contracts specify payment terms that work for the talent.

“From a payments standpoint, we try to normalize those payment terms as best as possible, and we have fairly aggressive payment terms,” Blumberg said. “It’s really structured in a way to build the greatest certainty and frequency, so that our clients get their money as quickly as possible and as frequently as possible.”

Blumberg said 10x invoices weekly, even if the payment terms are not quite that frequent, which helps to ensure that companies are staying on top of what they owe clients. It also keeps the invoiced amounts smaller, reducing the likelihood of a problem cropping up.

The contracts typically specify payment terms for either five or 10 business days, Blumberg said. The agency will not work with a company that wants to take longer than 10 business days to pay a freelancer.

“If a customer is like, ‘Well, we can only do 45-day payments,’ that’s great, you know, find another entity to work with,” he explained. “We’re not the right people for you to partner with on this.”

Creating Predictability

Blumberg said that having contracts with such strict payment terms helps prevent many of the common problems that can arise for contractors and freelancers.

“We found that this is the best method that works for our clients, and frankly, I think it’s a better method for the customers as well,” he said. “Those weekly invoices [are] another touch point of communication: how much somebody’s worked, what they’ve worked on in those hours. They’re getting that report weekly.”

10x rarely has significant problems getting companies on board with reasonable payment schedules and terms, Blumberg said, but there are plenty of companies in the marketplace with an outdated approach to engaging tech talent. When it comes to attracting and keeping the best and brightest talent, the same old way of doing things will not cut it anymore.

“With the frequency that we make payments, we’re aware of the challenges of processing invoices and making payments, but that is not an excuse to have egregious payment terms,” he said. “That’s really the message that we bring out into the marketplace.”

Occasionally, 10x still comes across a company that pays freelancers by check, but most of its companies make digital payments. Even with the added reliability and timeliness that comes from carefully crafted contracts and regular invoicing, Blumberg said there is a huge difference between digital and legacy payments in terms of processing, simplicity and speed.

There are steps companies must take if they wish to engage the most capable tech talent — enough of them that Blumberg said he wrote a book about the subject. The most important move, however, is overhauling procurement processes, including how companies pay contract workers.