Platforms that offer expertise across multiple verticals such as design and creative, web, mobile and software development, finance, and marketing.

Platforms that focus on offering expertise in design and creative functions such as photography, video editing, and animation.

Platforms that offer expertise related to web, mobile and software development with freelance developers fluent across major programming languages.


Platforms that provide marketing expertise across email, SEO, and social media marketing functions.

Platforms that provide expertise in writing, translation, and editing.

Platforms that provide expertise in specialized areas such as law, scientific research, and construction.

The on-demand economy has finally reached white collar work.

Online Freelancing Platforms

Overview

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 Online freelancing platforms (OFPs), part of the human cloud market including online work services and crowdsourcing&mdash;are online labor marketplaces that match the individual supply of labor with demand for professional talent from business organizations. Leading OFPs are companies such as Upwork and Freelancer who broker direct work arrangements between professionals and businesses on their platform.
 
 
 The platforms provide a diverse range of work categories from software and web development, to writing and translation, video animation, and data entry. For skilled professionals who are no longer constrained by geographical proximity to work, OFPs can fulfill a desire for flexibility and a balanced lifestyle. For companies, online freelancing platforms are a cost-efficient way to gain access to professionals with specialized skills on an on-demand basis, providing them with flexibility based on project needs.
 
 
 
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The global market size for online freelancing platforms is to reach USD 20.2 billion–34.7 billion by 2026

Market Sizing

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 Covid-19 is driving growth in online freelancing platforms:
 
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 <li>
 
 Upwork
 : In FY2020, gross service volume increased by 21% year-over-year (YoY) to USD 2.5 billion and revenue grew by 24% YoY to USD 374 million. Core clients increased by 17% YoY to around 145,000.
 
 </li>
 <li>
 
 Fiverr
 : In FY2020, revenue grew 77% YoY to USD 190 million on the back of a 45% YoY increase in active buyers up to 3.4 million with a 21% increase in spend per buyer.  The platform reported elevated demand in e-commerce, content creation, and digital marketing categories.
 
 </li>
 </ul>
 
 Multiple freelancing platforms in creative, marketing, web development, and legal verticals finalized funding rounds backed by pandemic led tailwinds:
 
 <ul>
 <li>
 
 Braintrust 
 raised USD 18 million in October 2020 as the platform experienced higher than expected growth due to the Covid-19 pandemic.
 
 </li>
 <li>
 
 BOOM
 raised USD 7 million in Series A funding in October 2020.
 
 </li>
 <li>
 
 Priori 
 raised USD 6.3 million in Series A funding in October 2020. 
 
 </li>
 <li>
 
 MarketerHire 
 announced its USD 3 million seed round in October 2020.
 
 </li>
 <li>
 
 Juggle 
 raised USD 2.1 million in seed funding in November 2020.
 
 </li>
 </ul>
 
 
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COVID19-IMPACT

Market Mapping

Incumbents in the online freelancing platform space largely connect freelancers in multiple industry verticals. Likewise, a large number of top disruptors have taken a similar approach such as listed notable disruptors Upwork and Fiverr. Web, mobile, and software development is a popular vertical with a considerable number of pure players in the segment. This could be attributed to high demand for related work as communication and operations migrated to digital form. The design and creative vertical is home to a handful of disruptors in their growth stage with notable companies such as Snappr.

The Disruptors

<h3>A majority of disruptors focus on the breadth of offering</h3>The companies dominating the online freelancing platform (OFP) space vary from newer startups to companies that have been in existence for just over a decade. Four of the disruptors identified were founded between 2008 and 2010, likely responding to demands post-financial crisis. Some platforms focus on diversifying their offering while others focus on one or two verticals, while gradually moving into more categories of work.In terms of volume, Freelancer has shown the highest user numbers and jobs and offers a diverse product with over 1,800 categories as of August 2021. Fiverr offers work across more than 400 work categories in areas such as graphics and design, programming, health and wellness, and business, but has a higher take rate than Upwork across their 90+ work categories (March 2021). Among private companies, French startup Malt leads with the highest funding (USD 134 million) as of August 2021. Disruptors such as Toptal and Snappr have a specialized offering, focusing on software development and design and creative categories, respectively.

Disruptor Funding History

The Incumbents

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 <h3>
 Traditional labor sourcing firms look to use a mix of M&A, innovation, and investments to adapt
 </h3>
 
 The incumbent players are traditional HR staffing firms that provide staffing solutions in either managing or assisting businesses in their recruitment process. Some companies have taken the initiative to develop their own online platforms, whereas others have invested in some of the disruptors. For instance, the Adecco Group, a global HR solutions provider, launched Adia, connecting freelancers to businesses in partnership with Infosys. Microsoft’s acquisition of Linkedin in 2016 for USD 26.2 billion marked its entry into the realm of online freelancing platforms (OFPs).
 
 
 Out of the incumbents covered here, Randstad is identified to have taken a particularly aggressive stance in using investments and acquisitions as a tool to grow its portfolio. Other entrants via acquisiton includes Vistaprint (owned by listed Irish company Cimpress) which acquired freelancer marketplace 99designs in October 2020. Backstage, a freelance marketplace for content creators announced the acquisition of two freelance marketplaces for creatives, StarNow and The Mandy Network in February 2021.
 
 
 
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Online Freelancing Platforms

Online Freelancing Platforms

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