Millions are buying business cards - and spells - for $5

1 year ago by Charlie White in Features

Fiverr ($FIVERR), the online marketplace for freelance services, has come a long way since it was founded in 2010. At first, it invited freelancers to offer their services for $5 a pop, and would-be employers looking to outsource for small jobs flocked to the site.

Fiverr is one of several players in the space, along with TaskRabbit, Freelancer, Mechanical Turk, and UpWork. They've all scaled, diversified, and grown. According to Dr. Otto Kässi, a labor economist and researcher at the Oxford Internet Institute in the UK, the future of work looks a lot like the gig economy that these services suggest. "We do observe a substantial year-to-year growth in the demand for online labor as a whole (see this Online Labor Index), with over 30% yearly growth rates," he said.

48 million online workers make up a $5 billion market of the burgeoning 'gig economy.' 

According to the World Bank, 48 million online workers make up a $5 billion market of the burgeoning "gig economy." 

The birth of Fiverr

As its name suggests, Fiverr began as a marketplace of freelancers willing to do odd jobs for $5. While there are still many $5 jobs to be found, the service's economy has expanded dramatically.

"Quite a few services on Fiverr [now] cost considerably more than a fiver," Dr. Kässi notes. In fact, some Fiverr workers are earning beyond $1,000 per gig. Buyers of the services can find a variety of freelancers from all over the world, offering the gamut of tasks that can be (legally) done for money, involving  jobs that go well beyond the usual graphic design services and audio mixing. 

For instance, you can sell or buy services involving anything from organic chemistry tutoring to saxophone lessons, buy fake Twitter followers, have someone make a puppet video for you, and hire personal assistance for almost anything. There's even prank assistance from freelancers like a guy who "will do any challenge, prank or embarrassing act" for you.

One of Fiverr's more intriguing new growth markets is in the act of casting spells. Want to get that girlfriend back? There's a plethora of practitioners who can cast spells to help you woo your bae back to conjugal bliss. Or maybe you'd like to cast a black-magic curse on that noisy neighbor — all for prices starting at, you guessed it, a fiver.

Today, millions use the service, and more than 15,000 claim Fiverr as an employer on LinkedIn.

The dark side of the Fiverr economy

But all is not bliss in Fiverr-ville. The company's been accused of exploiting workers due to the way that it encourages competitive bidding for projects. 

"This leads to a situation where workers around the world are competing against each other for each gig," Dr. Alex J. Wood, a labor economist and Oxford Internet Institute researcher at the University of Oxford, told Thinknum Media. "The growth of such platforms points towards a future where ever more jobs can be organizationally, spatially and temporarily fragmented and in which competition between workers leads to greater polarization of income and other features of job quality such as insecurity and overwork." 

The growth of such platforms points towards a future where ever more jobs can be organizationally, spatially and temporarily fragmented and in which competition between workers leads to greater polarization of income and other features of job quality such as insecurity and overwork.

The result? It's turning into a race to the bottom, according to many Fiverr workers who often take their grievances to anonymous forums like Reddit to find consort. Worse, they complain, after subtracting Fiverr's 20% commission, that $5 is quickly turned into $4. After subtracting PayPal service fees, that number drops even lower.

Some workers use the platform as a simple lead generator. In those cases, they bid on a five-dollar gig and up-sell a basic service with added extras and charges. That can turn five bucks' worth of work into an assignment that pays multiples. Using Fiverr as a lead magnet, however, can get users banned if they're caught. Instead, these wiley workers contract the initial engagement legitimately via Fiverr, and, if things go well, work with that employer on a direct freelance basis.

Inside Fiverr, the company

How happy are the employees and contractors working at the Fiverr corporate offices? The table below from the crowdsourced employer-rating service Glassdoor shows that many of those working for the company seem to grin and bear it:

Although Fiverr's employer ratings on Glassdoor have somewhat leveled off since the beginning of this year, between July 11, 2017 and March 14, 2018 there was dramatic rise in ratings, from a 3.4 rating up to a 4.4 rating, a 29.4% increase.

(A nagging doubt of the veracity of this Glassdoor rating data: The workers reporting their affection for the Fiverr service are self-selected and might be relatively happy, while those unhappy campers might have been too busy scuffling for their daily bread to fuss with rating their experiences on a job-ranking website.)

Let's look at a more reliable indicator of Fiverr's success, the website's own monthly active-users rank via Facebook logins. This is of particular use for our purposes, as the site heavily encourages users to login via Facebook. The table below shows strong growth in the site's ranking, an 87.37% increase over the past 18 months. Most impressive is the rapid growth seen at the beginning of each calendar year, with a 26% and 21.25% increase, respectively. Although growth dropped off slightly between last month and today — and the two years' first months might be a seasonal variance — a site rank pushing a nearly 90% improvement over a year is noteworthy by any measure. 

Finally, the company has seen explosive growth in terms of Facebook reach, climbing from 954,147 likes on September 8, 2016 to 1,421,913 likes just this week, a 49.02% increase. 

Into tomorrow

Last summer (2017), Fiverr rolled out Fiverr Pro, an invitation-only tier that offers only "best-in-class talent" that's more thoroughly vetted than that of its basic service. The upgrade offers a 24-hour helpline for both workers and employers and adds what Fiverr calls "personal success managers" to make sure everything goes smoothly.

"They hand-pick the provider instead of you having to negotiate. This seems to be a common service among the larger online platforms — Freelancer, Upwork and Toptal have similar services," Oxford researcher Otto Kässi told us. 

The result? With these higher-tier offerings, freelancers can rely on consistent work and employers are assured of a better talent pool. That's reassuring for all involved, except for those not chosen for this higher-end agency-within-an-agency. One has to wonder if this practice leaves left-out freelancers feeling like second-class citizens, treading water in the vast sea of competing freelance talent, hoping to be plucked for the major leagues. 

Rapid growth in the online gig economy is undoubtable, and it certainly has massive repurcussions for the way labor, employment, self-worth, and the simple notion of a "job" are to be understood both today and in a future that is probably going to see the worker-employer relationship differently.

According to Dr. Wood, "At the heart of remote-gig economy platforms such as Fiverr is a new form of control based on the algorithmic ranking of worker reputations. This form of control doesn't require the direct observation and monitoring of workers and means that work can be fragmented and dispersed across the globe."

This kind of work is growing faster in developed countries than the rest of the world. Wood noted, "Only a handful of countries (the US, India, the UK, Canada, and Australia) outsource the majority of digital work."

Online Labour Index top 20 worker home countries

Dr. Wood also believes there should be more regulation in the space. "Imagine if firms in these countries were legally responsible and accountable for ensuring that all workers, no matter where they live, must be treated with certain minimum standards." That's not quite happening at Fiverr… yet.

Charlie White

Charlie has more than 3 million published on Gizmodo, Mashable, Wired, NBCUniversal, Popular Science and Maximum PC. Co-author of both editions of the book "Blogg...

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