The Past and Future of Freelance Marketplaces
If you walk into the offices of Tracy Lawrence’s Chewse, you’re going to get hugged. This is just one of the takeaways from a panel called “The Evolution of Freelance Marketplaces,” held at The University Club in San Francisco on Thursday, May 12, 2016.
Scripted CEO Curtis Kroeker moderated a discussion with three panelists. Matt Faustman is the CEO and co founder of UpCounsel, which connects lawyers with companies that need on-demand legal services. Lawrence is CEO and co-founder of the office meal provider Chewse. Tristan Pollock co-founded Storefront, which connected creative people with unused retail spaces in their cities as well as venture partner and Entrepreneur in Residence at 500 Startups. Pollock was filling in for planned guest Anthony Rodio.
Over the course of a 70-minute conversation, the four discussed the ways they’ve grown their companies, changed their business models and handled the challenges of operating a marketplace in today’s landscape.
Some of the topics covered include:
- How the panelists’ marketplaces have changed over time. Lawrence describes how Chewse has evolved from being similar to food delivery services like Grubhub into its current iteration, in which Chewse handles all aspects of planning, delivering and serving meals to offices. Faustman talks about how Upcounsel originally serviced mostly startups and small businesses before they realized that big solutions would work for big companies too. Pollock discusses the challenges of increasing the scale of Storefront and how the company opted to expand to international cities.
- The evolution of Scripted’s marketplace. Kroeker describes how Scripted recently changed its platform to allow clients and freelancers to interact rather than having the company act as a go-between for all transactions. In its new open marketplace model, Kroeker describes Scripted as being gated on both sides. Access is gated for writers based on quality of work, with only 5 percent of applicants accepted. Access is gated for customers too, who now have to be paid members to find and hire the writers they want. This marks a shift from the old model, in which Scripted profited from charging transaction fees for work that customers wanted to be done.
- How to attract the right talent to work for you. Lawrence describes Chewse as “a love company” and believes that the best benefit you can give an employee is a good coworker. There’s a Friday ritual at Chewse in which employees offer gratitude to their coworkers, sending everyone off to the weekend feeling happy. The company hasn’t lost a full-time employee in over a year, she says.
- The biggest challenges of growing a marketplace. Getting the first customer isn’t the major challenge of starting a marketplace, the panelists agree. Growing the business and scaling it up is more difficult. “You can hack your way through the first 50 to 100 customers just to see if people are willing to use your product,” says Faustman. “It’s the next 1,000-5,000 customers that, depending on the marketplace, can be extremely challenging.” He compares growing the business to going from pushing two boulders uphill at the same time to pushing four boulders uphill.
- How to keep people on both sides of supply and demand happy. Lawrence and Kroeker both discuss the importance of exit interviews with unhappy customers to try to make improvements. Faustman talks about building tools on UpCounsel’s platform that give lawyers everything they need to turn a coffee shop into an office. Kroeker talks about how Scripted pays writers half their fee if customers don’t like the product. Making writers feel ownership and connection to the platform is key to generating more business. “If you have that psychological lock-in and emotional lock-in, I think that’s when you get those ambassadors out there that are now, you know, bringing you that demand side too,” he says.
Listen in for more tidbits about marketplaces and content marketing!