Autotrader ca Continues Its Platform Build out Through Acquisitions
Fiverr acquires Stoke Talent for $95M, adding freelance management tools for employers to its platform
On the heels of LinkedIn last week launching Service Marketplace, a competitor to freelance platforms like Fiverr and Upwork, today Fiverr announced an acquisition that speaks to how it plans to stay in the game by building in more features for its users. Fiverr is acquiring Stoke Talent, which lets companies manage their freelance teams, for $95 million.
Stoke's toolset includes features to onboard new freelancers; employers can also pay them through the platform and accordingly track their overall freelance budgets. The idea here is to build tools that both tie in those employers more tightly into Fiverr's freelance marketplace — Stoke will remain independently operated, but the products also will be integrated, so that freelancers hired via Fiverr can be onboarded and paid through Stoke — and also tie Fiverr more deeply into how those companies work with freelancers overall, even if they are not sourced via Fiverr itself.
Fiverr is now headquartered in New York — it's publicly traded on the NYSE and is valued at $6.3 billion — but it was founded in Tel Aviv, and that makes it a neighbor to Stoke, which was also founded in the city, by Shahar Erez and Hilik Paz, and it has 30 employees. Stoke had raised just under $20 million, with investors including Battery Ventures and TLV Partners. Its last valuation, according to PitchBook, was around $44 million, representing a small but decent return for investors.
"We share Fiverr's vision that freelance talent can help propel companies to new heights, both from a productivity and agility standpoint," said Erez, who is also CEO at Stoke Talent, in a statement. "This is an amazing opportunity to continue doing what we love to do, but on a much larger and broader scale. Together with Fiverr, we have the ability to build an ecosystem where businesses can implement a multichannel freelancer strategy and provide tools for them to efficiently manage not only freelancer engagement on Fiverr's marketplace, but those off Fiverr's marketplace as well. There are meaningful synergies between the two companies and we're excited for what the future holds."
The deal speaks to how big players in recruitment — namely Microsoft-owned LinkedIn — are working on ways of expanding their business by moving into new and adjacent areas of the employment market. This is in turn driving some consolidation, with larger and established players in freelance services snapping up smaller companies to expand their own platforms, creating more utility and monetizable features in the process.
Fiverr is still well ahead of LinkedIn in the freelancer landscape: Its marketplace covers freelancers from some 160 countries with specialties in more than 500 categories and nine verticals such as graphic design, digital marketing, programming, video and animation; and some 4 million customers have used Fiverr to engage those freelancers. LinkedIn by contrast covers half as many categories (with plans to expand soon to 500), with some 2 million freelancers registered; it's not disclosing how many customers have engaged their services just yet, and it is only now opening up globally outside of a limited, closed beta that it ran in the U.S. But LinkedIn, with nearly 800 million users and a very strong presence in the wider professional networking and job-hunting markets, will be a formidable competitor in any adjacent space that it decides to tackle.
That is something not lost on Fiverr. Indeed, it was less than a month ago that Fiverr acquired the online learning company CreativeLive, bringing a platform for freelancers to pick up and train on new skills to expand their employability. This was an especially poignant acquisition in light of LinkedIn launching a Fiverr competitor: LinkedIn has spent years building bridges between its online learning and professional development content and how that ties in with its recruitment and job-hunting tools. If LinkedIn is finding some traction in that area, it's essential for Fiverr to offer professional development tools, too, to remain a compelling platform for candidates to use.
The Stoke acquisition is serving the same purpose for the employer side of the Fiverr marketplace. Workflow and providing more efficient, one-stop-shop offerings is the name of the game these days in enterprise productivity, so having an option not just to source freelancers but begin the process of working with them from one place makes sense, even in cases where a company might already be using other budgeting and talent management tools already. Managing freelancers has its own complex set of requirements, which differ by country, where employing a freelancer for more than a specific amount of hours or work engagement can affect different kinds of tax and other issues, so the idea is that this would also help with that.
"The Stoke acquisition made complete sense on multiple levels," said Micha Kaufman, founder and CEO of Fiverr, in a statement. "It supports Fiverr's move upmarket and allows us to engage with much larger customers; It allows Fiverr to offer software solutions to businesses that already have freelancers that they work with and now can manage them easily; It allows Fiverr to pair its marketplace talent with large customers that need access to freelancers they still do not yet have a relationship with; It gives Fiverr access to the offline freelancing market that is still orders of magnitude larger than online freelancing; and finally, Stoke is a fast-growing best-in-class product with an incredible team behind it that we are delighted to add to our family."
The question now is whether we'll see LinkedIn and others following suit and looking to build similar experiences.
Source: https://techcrunch.com/2021/11/02/fiverr-acquires-stoke-talent-for-95m-adding-freelance-management-tools-for-employers-to-its-platform/
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