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Just before the pandemic hit in 2019, the number of buyers using freelancers on Fiverr increased 14% year-over-year to 2.2 million. This number has steadily increased in the years since: the number of active buyers rose to 4.2 million in March 2022.
But Kaufman said the number of companies using freelancers represents only “a tiny fraction of the addressable market” in the United States. According to Fiverr’s Freelance Economic Impact Report, half of freelancers have seen an increase in demand for their services in the past 12 months. Kaufman said these changing dynamics will propel freelancing into the mainstream for years to come.
This interview has been edited for clarity and conciseness.
Much of the conversation about the future of work is about regular paid jobs. How is Fiverr thinking about the future of work?
I think we’re in many ways the beacon child of remote work, because that’s the type of market we’re fueling. And we also work the majority of the week remotely. I think one of the interesting things that happened, and a lot of it was because of the pandemic and the fact that it forced everyone to at least donate [remote work] one test is the fact that more and more companies are able to understand that it is necessary to focus less on people’s time and more on people’s production.
What has happened throughout the global lockdown has been a situation where companies have lost their ability to know when their team members or employees are actually working. There you go, it wasn’t a terrible thing. The activity did not decline. In fact, in many cases it has increased. And that lack of control over people’s time was less and less, and it was replaced by a focus on production. And I think that’s what we’ve been advocating for many years.
The other thing is I think the pandemic just created this ripple effect on something that would have happened anyway. It’s not about those black swan events. It all depends on whether it’s a generational change, what’s happening in the workplace. It is worn by the younger population. So it started in 2010 when millennials entered the workforce. By the end of this decade, 2030, millennials will make up 75% of the workforce, which means the way they like to work is the way everyone else is going to work because they’re going to be the vast majority, and Gen Z followed.
“What’s happened throughout the global lockdown has been a situation where companies have lost their ability to know when their team members or employees are actually working. Lo and behold, that wasn’t a terrible thing. “
I think the younger generation has brought this new way of thinking, and that’s why statistics show that by 2030, 50% of American talent will go into freelance work, which is amazing, because that means for companies, half of the talent will not be available for full-time employment. And it’s pushing companies to think differently about how to interact with talent in general.
Fiverr is creating this operating system that will enable or unleash access to talent and integrate that talent into business workflows. It’s as easy as using cloud computing these days. It’s just a few clicks of a button. And we’re seeing more businesses embrace this change and take steps to ensure they can benefit from the flexibility it gives them.
As companies start to embrace this idea of talent as a service more and more, how has the number of companies using Fiverr changed?
We’ve seen a massive increase in growth… If we look at just the last 12 months, there have been 4.2 million businesses globally, about half of them in the United States… That’s about 2 million out of 31.7 million small and medium enterprises. medium-sized businesses in the United States. It is therefore still a tiny part of the addressable market. The growth opportunity is simply huge, and we believe this is just the beginning of this market.
It always reminds me of the early days of e-commerce when e-commerce was still a low single digit penetration percentage. And it was obvious that it would become a force in business, but it was just a matter of time and market education. And once that happened, it actually went through an inflection point. And the beauty of our business is that, as successful as it is right now, it’s still at a pre-inflection point. That’s why I’ve been doing this for about 13 years, and I’m more excited now than I was 13 years ago.
I want to talk about the Togetherr service that was just announced. It has been described as “fantasy football meets advertising”. How would you describe it?
Talent doesn’t want to work with the same brands over and over again. So they start to leave the agencies and become independent. Clients come in, and they understand that they have a variety of different needs and they don’t want the same agency to do everything because as talented as any agency may be, they don’t have access to all the talent in the world. They have access to the talents they employ.
“We try to provide all the tools you need to run your business so you can focus on the things you’re really good at.”
What we realized was that this presented another opportunity to disrupt the market by unlocking access to talent by creating these on-the-fly dream teams that can actually deliver a project for you.
Essentially what we do is we understand the very fine details or attributes of each talent and know how to connect those talents together to form groups that will work on your project and then bring it together.
With the rise of remote work, workers have a less clear divide between work and life. Fiverr provides tools to help freelancers manage their time. Are there any growth plans in this space?
Absolutely yes. We believe that like the way we work, everyone should have a reasonable balance. And, by the way, that balance changes over the years and how you build your career. If you ask me, I don’t remember my 20s and 30s. I worked so hard. And I don’t regret it because it was my decision. And it was important for me to build something very big. But that’s not the only way to build your career. And everyone must choose their own path. And for us, what’s really important is that people don’t spend their time doing things they shouldn’t be doing.
What do freelance tool stacks look like?
If they’re using Fiverr, the ambition we have is that they don’t need to use any other tools to run their business… As much as we can take from what isn’t needed, we provide it . So if you think of Fiverr as a platform, freelancers don’t care about anything to do with contracts, billing, figuring out how to exchange information and data files. No need to deal with NDAs, no need to deal with storing and retrieving work. All of this is built into the platform. Thus, they get very detailed reports on their performance. So they can determine where they can do better.
We have products that allow freelancers to also manage their business, even if they have activities outside the platform. We have a product called Fiverr Workspaces. This product allows freelancers to send invoices, send proposals, get paid, and more. We think about this holistically. We try to provide all the tools you need to run your business so you can focus on the things you’re really good at.
When do you think the company will hit that inflection point you mentioned earlier?
That’s the trillion dollar question. It is very difficult to say how the general awareness is progressing. And again, going back to my comment on e-commerce, it took about two and a half decades for e-commerce to reach 10% of commerce. Why didn’t it happen faster? Because it’s a tectonic shift. it takes time to educate people: “Why do you spend like a month trying to find a freelancer when you can go to Fiverr and on average it takes five to 15 minutes?” Why? Well, it takes time. And the bigger the companies, the slower they move. The slower they adopt new things. As for small and medium enterprises, they are super agile, they are super flexible. They will use anything new. And as we move up in the market, as we move into bigger companies, obviously those changes are slower. I don’t think we are far from that point.
I was talking about the younger generation that has arrived. This young generation that arrived in 2010 is now 10 or 12 years old in the labor market. They become managers. They know how to use these systems. So I think in many ways we’re probably closer than ever to that inflection point. And we definitely push like everything we do, from creating awareness campaigns like Super Bowl ads to working with our community to spread the word.