Upwork is a freelancing marketplace -- and the largest one with more than $1 billion of business flowing through its platform every year, generated by businesses finding talent of any kind that can be done online (software developers, writers, designers and translators, to name a few). The company is the result of the merger between the two leading freelancing marketplaces, oDesk and Elance, and a rebrand of the merged company. Prior to merging, these companies had collectively raised $174.7 million in institutional capital and been the first online business ranked in Staffing Industry Analyst's list of US staffing and talent engagement companies.
1. Trust your gut
Conventional wisdom would say that merging two private, competitive companies is very difficult. Stephane explained the merger was initially met with resistance, "Elance and oDesk were two companies with similar backgrounds. Their strategies and target customers diverged for a bit, but they were soon back at each other's throat. They had very similar visions and were spending a lot of their resources competing against each other rather than tackling the enormous market opportunity. At the point when we did the merger, while we were seen as a mission critical source of talent for our early adopters, the opportunity to reach a broader market of people who didn't yet even realize it's possible to access freelance talent online represented hundreds of billions of dollars. Our leadership teams knew that by combining our energy we could scale much faster so, though we were advised not to do the deal, we went through with it and it was closed in spring 2014."
2. Save what works, get rid of the rest
Elance and oDesk were two separate platforms with their own communities. Once the merger was approved, Stephane and team started figuring out their post-merger product strategy. Did it make sense to maintain two sites? Information gathering and discussion began...
"You only know a merger is going to happen after it's done. You can have all these discussions about what the post-merger world will look like, but the plan we had wasn't the right plan." After months of looking at data and talking to customers, Kasriel came to the conclusion that "The two platforms' feature sets and communities were similar but our code bases were different; therefore, it made the most sense to move to a single platform." They took the best from both platforms, based on customer feedback of what they cared about most, plus added new innovation to create a new platform that, upon relaunch, was named Upwork. Over the course of 2015 and into 2016 the platform has been helping its community members sign up for Upwork and gathering further feedback.
3. Rebranding is always an option
We then discussed branding. Stephane outlined the possible scenarios; 1. keep the Elance or oDesk brand and possibly alienate either oDesk or Elance users, respectively, 2. combine the brand names or 3. create a new brand.
"We had a great opportunity to relaunch under a new name because it helped us move forward in becoming an even more futuristic company," Kasriel says.
In choosing the name Upwork, Kasriel wanted it to help the company move into its aspirational phase as a brand. "We are a company that is helping shape what the future of work looks like," he said. "And our customers are futurists as well. They have the vision to be working differently by creating virtual teams and working with people via the Internet. They're breaking down the barriers of traditional work and we wanted a name that represented that."
4. Fight for liquidity
Balancing supply and demand is the most important imperative for any marketplace. What Craiglists lacks in user experience and branding, it makes up for with its highly liquid marketplace. Chances are that if you put an ad to sell your bike in a rural town in Montana, you'll receive hits and be able to sell your bike. This is the power of networks; this is platform power.
Kasriel cited improved liquidity as another major reason behind the merger. As he described, "We were looking to achieve that breadth and depth. If a customer is looking for a lawyer, accountant, data scientist, any knowledge work, we want Upwork to be able to provide them with someone online who can chat almost instantly."
5. Mass-produce platform trust
""Our customers don't necessarily have time to invest in deciding whether they like the person or if they're trustworthy," Kasriel says. "And many have company policies that make it very important that freelancers are thoroughly vetted and have completed certain processes. That is why trust is embedded in our platform -- a huge advantage of what we deliver is a pool of talent that is already vetted by clients and will also be easier to work with due to our technology."
Stephane elaborated, "There is a point between free fall super high growth marketplaces like Craigslist and slower, more steady growth marketplaces. We're judging ourselves on the predictability of the outcome delivered. We want consumers and producers to know what they're getting into and be satisfied."