
Upwork is Changing Again and What We Can Do About It - skeeper
https://medium.com/@LevelWorkingField/do-you-like-new-pricing-or-higher-fees-upwork-is-changing-again-and-what-we-can-do-about-it-6c755e245fb7
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phantom_oracle
A lot of people are mentioning "let's build a clone that is better and will do
us greater justice", but ask yourself, with 14 million entrenched users, how
is building an upwork clone any different to "let's build a twitter/facebook
clone"?

The merger did precisely what they wanted it to do:

 _Give a single player a dominant market-share. This single player will then
engage in price-flooring practices until they 've snatched up the largest
market-share. They will then enforce their gradual fee and upselling
strategies._

This is no different to any other market where a monopoly exists. Internet
companies like to claim they aren't monopolies by saying "just visit another
site for their services" but entrenchment of the market is exactly what makes
them monopolies.

If a large-enough competitor came along (with big funding backing it), you'd
soon see Upwork change tack and go back to price-flooring.

~~~
tobltobs
I don't think you can compare the situation with twitter or facebook. Those
are actually good at what they are doing. But upwork is such a crap (in my
experience as a client, for freelancers it must be horrors) that a lot of
people would jump ship as soon as there would be an alternative. But sadly all
alternatives like guru or freelancer.com are as bad or even more (missing
words to describe those clusterfucks) as upwork. Elance was at least a bit
usable. Toptal might be an alternative but their boarding process looks a bit
esoteric and is aiming at another targetgroups anyway.

~~~
skeeper
"But upwork is such a crap (in my experience as a client, for freelancers it
must be horrors)... sadly all alternatives like guru or freelancer.com are as
bad or even more" \--- That's true!

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ccozan
There is not necessarily a need for 100% community effort.

What is needed a simple, decent service, with reasonable rates ( from 1% to 3%
from a transaction ) and keeps up with the requests. Such a service could be
run by a max 5 person company and I believe everyone could profit.

I worked with Upwork and I liked the concept, but the implementation was a bit
to complicated. With this changes, I really hope new such services will come
up and fill this decency "void". The strategy of Upwork eludes me, since their
strenght lies in the participants and alienating them is the last thing you
want to do.

~~~
projectramo
But once you have 14 million users, what prevents the 5 guys from going: "Hey,
you know what? If we just bumped up rates to 6%, we'd make a lot more money
and we won't lose too many people. We're providing a great service and a lot
of the customers are happy to pay that amount."

~~~
ndarilek
Make it a co-op. Build restrictions into the corporate bylaws such that
classes of members can check and balance acts like this. Implement profit-
sharing, so not only would that 1% increase in fees help fund development, but
it would also be returned in part to platform members. Of course it may be
necessary to increase fees once you've got an actual idea of what your
expenses will look like, and profit-sharing may necessitate a larger increase,
but then _everyone_ has incentive for the platform to succeed.

~~~
skeeper
Some smart people really think alike. +1 on that!

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mooreds
An aside.

Anyone who is interested in marketplaces, whether their implementation,
management, or value, should read "The Middle Man Economy" by Marina
Krakovsky:
[http://marinakrakovsky.com/books/](http://marinakrakovsky.com/books/)

This book was very helpful to me in understanding concretely how marketplaces
and middlemen can actually have real tangible benefits (though, working for a
marketplace startup now, and having worked for a real estate brokerage in the
past, I have more than a passing familiarity with the value propositions of
several types of middlemen).

Alternatively, here's a podcast with the author:
[http://www.econtalk.org/archives/2016/03/marina_krakovsk.htm...](http://www.econtalk.org/archives/2016/03/marina_krakovsk.html)

~~~
skeeper
Could you share the name of your marketplace startup? Is it purpose driven?

Thanks for sharing those links

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zimbatm
Why is a central authority controlling the market again ? What we need is
interfaces for the customer and workers that can be matched together by a
broker. It's probably quite hard to find the right interface but it would then
benefit everyone.

Here is a simpler example for a Uber-like implementation:

* Taxis would be advertising their current position and whenever they they are free or not with their phone.

* Potential customers would advertise their current location and where they want to go with their phone.

* Broker services would match taxis with customers

Obviously it's more complicated than that, there could be a reputation service
associated to an account for example and your own algorithm running on your
phone that chooses the combination of trust and pricing that you want.

~~~
skeeper
Could you explain more? Platforms like Upwork serve as interface or broker
between customers and workers. Are you referring to something different?

~~~
zimbatm
Upwork is a monolith. It's a broker but also holds the developer and customer
data. Competing brokers cannot enter the market without having to ask
developers and customers to duplicate their data.

If the developer had it's own service (like his personal website) that hold
the list of services that he provides, his availability and general price.
Then brokers could connect to this and match it with customer requests. Same
on the other side, a customer should be able to submit his project proposal
and let the various brokers pick it up and match the appropriate developers.

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mooreds
Network effects make this effort a bit quixotic, just like diaspora and ello,
with respect to consumer faxing networks. But hopefully they'll give it a go,
and maybe surprise this cynic.

~~~
skeeper
With community support and the right people to create and maintain it, it's
definitely possible.

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cantagi
Lets hope this is a race to the bottom for freelancing websites, rather than
freelancers! Its also reminiscent of the opposition to Uber by London cab
drivers: [https://www.theguardian.com/technology/2015/sep/05/london-
bl...](https://www.theguardian.com/technology/2015/sep/05/london-black-cab-
drivers-app-uber-taxi)

~~~
skeeper
Thanks for sharing the article. I do hope it turns into a race to the bottom
for freelancing websites and a race toward overall improvement and fairness.

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nfriedly
Back when it was called elance, I was getting annoyed that it would bill
clients automatically but then leave the money sit in my elance account -
there was no way to automatically send income to a bank account. So I wrote a
bot that logged in on my behalf every day and initiated a bank transfer if
there was any money available.

I don't believe this violated the ToS at the time, and Elance never said there
was anything wrong with it. But once I posted it to the forums, my account was
suspended within a day for a couple of silly things like having a reference to
my personal website in one of my example images.

I quit putting much faith in the company after that.

~~~
skeeper
They seem to be getting some profit by keeping YOUR money on their accounts.

~~~
mooreds
It's called "float"\--all kinds of companies use it. More here:
[http://www.fool.com/personal-
finance/insurance/2006/12/05/in...](http://www.fool.com/personal-
finance/insurance/2006/12/05/insurance-industry-basics-float.aspx)

~~~
skeeper
Thanks. I learned another cool jargon. Whatever "floats" their boat, I guess!

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ap46
20% fee for work done for mostly one time clients?!

That's just baloney.

~~~
skeeper
It's a huge, big crap of a baloney. :)

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mooreds
Maybe something like a REI or Vanguard model would work, where the company
providing the service is a cooperative owned by the members?

~~~
sanderjd
This is such a good idea that I'm surprised I haven't seen this model yet.

~~~
skeeper
Maybe because it's easier to launch something that is motivated by profit (for
a few people) than anything else?

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skeeper
The Medium article above has gathered almost 4,000 views today and yesterday.
We got amazing support. Getting close to 6,000 views. We should keep on
sharing this with everyone out there!

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skeeper
Thanks to all those who made their comments here. I look forward to more
comments in the coming hours and days! Let's keep this fire burning, so more
people would see this!

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edoceo
The alternative already exists, why isn't it being used?

~~~
skeeper
Can you tell which alternatives? They are either similar or inferior to
Upwork, or are still new and relatively unknown (and therefore there are not
much jobs in their platform). It's a huge dilemma.

~~~
edoceo
Here is the newest one:

    
    
      http://bitkick.org/
    

My partner and I just kicked this off. We've got 6mo of runway and must
acquire 100k freelancers in that time. Its chicken & egg, of course, we've
decided to start on the talent side.

We are also looking for freelancers to participate in market research
interviews to help guide our build out.

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SarahMobius
The new pricing structure halves my Upwork fee for most of the jobs I do. I
had no time to comment on the complaints page though.

~~~
ap46
The comments page proactively mentions adherence to community guidelines would
be required while posting.

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skeeper
This article is close to 6,000 total views. More support!

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projectramo
One word: Non-profit.

Okay, it is a hyphenated word.

~~~
tonyedgecombe
It does strike me some kind of worker owned co-operative would suit this type
of organisation.

~~~
skeeper
That's possible too. I think a few companies (in other industries) have taken
this path.

