When you need a freelancer or contractor, what do you do? Post an opening on Craigslist? Get referrals from employees? Ask business acquaintances for recommendations? Once you hire them, what happens when you need to track that freelancer’s work and make sure they get paid? To solve those problems, more and more companies are turning to online freelancer marketplaces.
It’s not news that businesses inside and outside the gig economy are using more freelance and contract labour, and the Covid-19 pandemic has only increased this.
Engaging a contractor doesn’t require going through the same steps as hiring a full-time employee. But it does involve vetting candidates to find people with the right skills, negotiating fees, signing contracts and tax forms, making sure work is finished when it’s supposed to be, setting up payments, and communicating about everything along the way.
Accomplishing all of that in a timely manner is no small feat, even if it’s just for a freelancer or two. Multiple that by 10 or 100 and it’s easy to see why a cottage industry of cloud-based freelance marketplaces has emerged over the past few years to help business owners and human resources (HR) managers keep up.
Differences in Freelance Marketplaces
All freelance marketplaces are definitely not the same. Some are the equivalent of fast-food joints, with a heavy emphasis on large quantities and low prices. Others are more like fine dining; there aren’t as many options from which to choose but what is there is high-end and prices reflect it.
Freelance platforms differ in other ways, too. Some are industry or job-specific such as Behance for graphic designers or Contently for writers and editors. Both offer freelancers free portfolios to get more people to sign up and expand their database of contractors from which businesses can choose.
Some platforms go beyond matching freelancers with gigs, and offer companies tools to manage onboarding, project management and workflows, email and other forms of internal communication, payments, and more. Some offer escrow accounts to hold payments until contractors reach certain milestones or finish their work, while others have companion mobile apps.
Because platforms can be so different, it’s important to know going in what you need, what’s covered by your existing HR tech, and what you can afford. Here’s a look at five non-industry specific platforms for finding and managing freelancers that offer varying services and extras. Listings are in alphabetical order.
How It Works: Fiverr is a global marketplace for creative and digital services. Companies can search for freelancers in more than 100 categories, including graphic design, marketing, and programming.
Registered Users: Total freelancers (“sellers”) and companies (“buyers”) aren’t disclosed, but buyers that have used the service include Lego, Pandora, and Microsoft. A Fiverr spokesperson said 85 percent of buyers are small businesses.
Transactions Per Month: 1 million+. In 2020, 3.4 million users bought services from freelancers on Fiverr.
Fees: The site has moved beyond its roots as the place to get freelance work for $5. Today, freelancers set their own fees, which range “into the thousands” based on the complexity of the services being offered, according to the company. Buyers pay in advance and Fiverr collects a 5 percent transaction fee on purchases above $10.
Tools for Managing Freelancers: Fiverr Business
Good to Know: Buyers aren’t allowed to contract sellers outside of the platform. Read Fiverr Tips for Buyers for more on how buyers use the site. As of May 2020, freelancers on Fiverr had earnt over 2 billion dollars collectively since the service was founded.
How it Works: Freelancer.com, the Australian-based freelance marketplace says it has users in 247 countries and 900 categories, including accounting, data entry, design, engineering, legal services, sales and marketing, software development, and writing.
Registered Users: More than 19 million, though the company doesn’t distinguish companies from freelancers. Most buy-side users are small businesses but Freelancer.com says NASA has used the service since 2015 to crowdsource space-related design projects.
Transaction Per Month: Not disclosed, though the company claims more than 9 million projects have been posted to date.
Fees: Businesses pay $3 or 3 percent of the project fee, whatever is greater. Freelancers pay $5 or 10 percent of a project fee, whatever is greater, upon being accepted for a project by an employer. Subscriptions are available and start at $.99 per month. Fee-based extras include a $29 non-disclosure agreement (NDA) template.
Tools for Managing Freelancers: Companies and freelancers can use built-in tools to share files and chat, even before agreeing to work together. Freelancers can use an app to track their progress, monitor hours, and send messages to a client.
Options for Paying Freelancers: Bank account, credit card, PayPal, Skrill, and some country-specific payment methods. Payments are placed in an escrow account and paid out at specified project milestones.
Good to Know: Companies and freelancers can use Freelancer.com’s Android and iOS apps to post or bid on projects.
How It Works: LinkedIn ProFinder is a separate platform from LinkedIn’s mainstay social network. The US-only pilot connects corporate customers with white-collar professionals in accounting, business consulting, coaching, design, insurance, marketing, real estate, software development, and writing and editing. Companies submit a request for proposal (RFP) on which freelancers bid.
Registered Users: Not disclosed
Transaction Per Month: Not disclosed
Fees: LinkedIn isn’t charging business users or contractors anything to participate in the ProFinder pilot. However, a spokesperson said the company is evaluating various types of pricing for when it launches.
Tools for Managing Freelancers: None
Options for Paying Freelancers: None; companies handle payments off the platform.
Good to Know: Companies are using ProFinder to find contractors in financial services, photography, and real estate; insurance and finance can only match with professionals in their area because of local laws or the local nature of the work.
Launched: The company launched in 2010 as Crowdsource.com and rebranded as OneSpace in November 2015.
How It Works: OneSpace manages freelancers, contractors and other types of what it calls “agile talent” for corporate clients on a custom basis. The company expects to launch a self-service platform in June that will let business clients use the platform to directly hire, manage, and pay contract workers or teams.
Registered Users: OneSpace doesn’t disclose total corporate users, but Apartments.com, eBay, Facebook, Microsoft, Overstock, and Staples are listed as customers on its website. According to OneSpace, more than 570,000 freelancers have used the platform.
Transactions Per Month: Not disclosed, but the company says freelancers have used it to complete more than 125 million assignments.
Fees: Freelancers don’t pay anything. Enterprise clients pay OneSpace an undisclosed management fee based on the services they use. The self-service platform will have multiple service levels with prices to match.
Tools for Managing Freelancers: In this area, OneSpace acts like a full-blown HR management platform, with options for reaching out to “highly qualified talent on demand,” onboarding teams, assigning tasks to various team members, creating workflows, creating data-based reports, paying contractors, and conducting performance reviews,
Options for Paying Freelancers: PayPal
Good to Know: Much of OneSpace’s leadership team came from MonsterCommerce, an e-commerce shopping cart software maker that Network Solutions bought in December 2015. To date, the company has raised $21.5 million in venture financing.
Launched: Elance launched in 1999 and oDesk launched in 2003. The companies merged in 2013 and rebranded as Upwork in May 2015.
How It Works: Upwork’s basic online marketplace matches business users with freelancers. Businesses can sign up for two premium services: Upwork Pro to find pre-screened freelancers for long-term projects, and Upwork Enterprise, which includes sourcing, recruiting, and training freelancers; onboarding them to a cloud-based HR management platform, and using the platform to manage projects.
Registered Users: The company says it has more than 5 million registered clients and 12 million contractors. Corporate users listed on Upwork’s website include Amazon, Eventbrite, Microsoft, OpenTable, Pinterest, The Motley Fool, UCLA, and Unilever.
Transactions Per Month: Not disclosed
Fees: Business customers pay a 2.75 percent payment processing fee. Contractors pay a 10 percent service fee for each hourly or project-based transaction. Upwork Enterprise charges an annual subscription per department plus an undisclosed transaction fee.
Tools for Managing Freelancers: Upwork provides business users with a variety of tools for managing contractors, including (but not limited to) audits, custom reports, file sharing, invoicing and payments, messaging, and time tracking. Upwork says its Enterprise service also includes compliance guidelines to help companies treat contractors like contractors so they don’t run into problems with employee classification laws.
Options for Paying Freelancers: Credit card, PayPal, bank accounts; the company pays freelancers in 90 currencies. Upwork offers escrow services so business customers can bank freelancer payments until work is finished.
Good to Know: The company rolled out Upwork Pro in February to appeal to midsize companies that needed more help than its basic service provides but couldn’t afford its top-tier service. The company’s raised $175 million in venture financing.