Fiverr, an Israel-based startup and one of the drivers behind the so called Gig Economy, raised a $30 million Series C from Bessemer Venture Partners, Accel Partners, Qumra Capital and additional private investors.
The round brings the total funding raised to $50 million.
Founded in 2010 by Shai Wininger, Micha Kaufman and Guy Gamzu, Fiverr is a global marketplace for services from creatives and other professionals with offices in Tel Aviv, New York and Miami. Like the company name suggests, offers start at $5 but customers can add extra services like faster delivery of the product by paying for so called Gig Extras.
Along with the funding comes a relaunch of the website with the aim to make it easier for customers to find and book the right person for the job. Categories include Graphics & Design, Online Marketing, Writing & Translation, Video & Animation, Music & Audio, Programming & Tech, Advertising and Business.
Why is this important?
Freelancing and the gig economy are increasingly promoted as the future of work for the vast majority of people. With the coding hype still in full swing, sites like Fiverr draw a more realistic picture of what most workers in the creative and tech space can expect as salaries or freelance income down the line.
"By 2020 the number of independent workers is predicted to double, with online freelancing increasing at an even faster rate,"
says Fiverr Co-Founder and CEO Micha Kaufman. Erez Shachar, Managing Partner at Qumra Capital adds
"As the future of work is increasingly dominated by freelancers, entrepreneurs and independent workers, Fiverr is positioning itself as the home for this rapidly growing community. We're excited about investing in a company that is central to the success of millions of participants in the Gig Economy."
While established portals like Amazon Mechanical Turk or Freelancer and oDesk, which recently merged, are more suitable for business customers with more complex tasks, the offers on Fiverr also appeal to a broader audience. Another difference is that on Fiverr the freelancers offer their services to customers whereas on classic freelancing portals customers come with a specific task and search for a freelancer to work on it.
Fiverr calls its new 3.0 version Services as a Product or SaaP and aims to reduce the friction of ordering an online service to a minimum. No negotiation or complicated contracts, just a few clicks.
"Like eBay and Amazon, customers simply browse, search, and buy, selecting from more than 100 categories and millions of services. It's as easy as buying a book online.”
says Adam Fisher, Partner at Bessemer Venture Partners.
Over the years the offerings on Fiverr have become much more professional, so have the customers who now order gigs for copywriting, translations, proof reading, logo and web design and other small creative tasks.
Disruption
Of course, there are growing pains. Sacha Greif, a designer from Paris and Internet entrepreneur just wrote a post titled “What Kind of Logo Do You Get for $5? - An epic tale of deception, stolen artwork, and crappy logos” on Medium, though you have to take the post with a grain of salt.
Like eBay and Amazon, Fiverr mainly relies on a rating system from its buyers and most of them seem to be happy with the results they get. Greif’s post is from the perspective of an established designer who plays by the rules of the design community like don’t copy other artwork or use templates from stock photo marketplaces. The problem is that these marketplaces don’t tend to play by these established rules when career changers enter the game. I saw pretty much the same in language teaching when all of a sudden “everyone” could be a teacher thanks to the Internet, not to use the overused term ‘disruption’ here.
According to Fiverr there is a gig sold every 4.7 seconds with most of them costing more than $5. Fiverr takes 20% commission. The marketplace sees a high return rate of customers and the first Fortune 500 companies are starting to use the marketplace according to Wall Street Journal.
Further Reading
- Fiverr Raises $30 Million to Fuel Global Growth of World's Largest Marketplace for Services | Marketwired
- Fiverr Raises $30M for Online Services Marketplace | Wall Street Journal
- What Kind of Logo Do You Get for $5? - An epic tale of deception, stolen artwork, and crappy logos | Medium