
Fiverr, a Microtask Marketplace, Raises $60M - jsnathan
http://venturebeat.com/2015/11/11/fiverr-raises-60m-to-help-lure-freelancers-online-and-removes-5-minimum-charge/
======
rohi81
While I wish the team all the best - this site always has 501 gateway errors.
Their service portal or website is terrible and constantly keeps crashing.
While their supply and demand is ok and you get what you pay for.

Still amazed at the crappy technology that backs up this business and the
money being raised by a team that has no interest on customer experience.

------
ThomPete
If they aren't currently profitable why continue to sink more money into this?
Isn't this exactly the kind of service that should be able to grow
organically?

~~~
vinceguidry
Marketplace products take a lot of time and care to tweak before they can
really be profitable. It's (relatively) easy to become profitable if you're
bucking legal boundaries like Uber is, but Fiverr doesn't have any of those
advantages.

The company providing the marketplace has to add enough value to both sides of
the market to justify its existence as opposed to potential customers just
using traditional methods of finding each other.

So they have to burn capital to learn those lessons. Trying out models takes
time, and time is expensive. They were able to get a bunch of users using
their brilliant pitch, but they weren't able to make it profitable. It doesn't
make sense to give up on the company yet, as they still have a huge user base
that they can test out new product strategies on.

The investors are betting $60M that they'll be able to find their way. I see
no reason to get cynical about it.

~~~
notahacker
Isn't the bigger difference with Uber that it's a service that many people
need multiple times a week and everybody needs sometimes, and the average
transaction value is a fair bit higher? Sure, Uber obtains an advantage from
flaunts more laws than even the most aggressive copyright/TOS-violating
marketer advertising themselves on Fiverr, but even law-abiding fully-licensed
taxi firms have tended to be profitable.

There are possibly more lucrative areas of the market for Fiverr to explore,
but Amazon is an unusually savvy and price-competitive 800b gorilla in the
Mechanical Turk space, and I'm not sure how helpful the Fiverr brand is in the
Upwork space. They already own their own space, it just isn't necessarily as
big as a dubious claim like "the gig economy workforce expected to hit 43
percent of the total workforce by 2020" might suggest. If they're doing 1m
transactions per month (>$1m revenue per month) as claimed in the article I'd
have thought the reliable route to profitability lay with trimming expenditure
rather than doubling down...

------
mod
They're spending it all on spamming my inbox.

I get an email daily from them about great jobs, free $5, etc etc.

~~~
sickrumbear
Am sure you could unsubscribe from those emails if you wanted to though,
right? It's not like they're raising the money specifically to spam people.

------
JonFish85
How much of that $60M is going to end up sunk into legal battles of "employee"
vs. "contractor"?

~~~
lemevi
I doubt it applies, if it did any rent a coder site and even craiglist and
forums with marketplace would be susceptible to it.

Uber has that problem because they have a partnership with their drivers that
is more extensive than just what is basically a "for hire" classifieds listing
on fiverr.

