In the past decade, we’ve seen rapid growth in the number of websites and platforms that allow freelancers to sell their services and products. Each marketplace has its own unique features, advantages, and disadvantages. Here is a brief guide of the three main digital marketplace platform categories:
The first group of freelancing marketplaces we’ll cover are those that are not industry specific. Many of these platforms have been around for years, so they are easy to use and have a wide customer base. The downside of these platforms is that it can be a difficult to stand out in a vast pool of freelancers; particularly for individuals who are more experienced in their industry. This may result in a global “bidding” war among freelancers where the cost of living is vastly different. Moreover, the transaction fees can take a significant portion of the project. However, they can be a great place to get your feet wet in the freelancing world or generate extra income.
A few examples:
Upwork: Upwork is one the largest freelancing marketplace on the Internet. It recommends a shortlist of freelancers to clients based on the qualifications they seek, such as skills and past performance. As a freelancer, once you create your profile, Upwork highlights tailored job listings that match and allows you to search for projects. Additionally, Upwork has extensive internal communication capabilities that enable freelancers and clients to share files and collaborate directly on the platform.
Freelancer: The key difference between Upwork and Freelancer, is that on Freelancer you submit bids for the projects on which you would like to work. A client posts a job listing, and then freelancers write a bid for that listing. Contrary to what the word “bid” might imply, the job doesn’t necessarily go to the lowest offered price. The client can choose from various bids based on a combination of factors like price and qualifications.
Fiverr: Fiverr has a similarly bidding model. In fact, the business model was originally products and services that could be purchased for $5. Now, freelancers can charge more for their services, and clients can select based on their search criteria. Given its original price range, this format makes Fiverr suitable for smaller one-time projects.
The next category of freelance marketplace platforms are those that are specialized and/or selective. Usually catering to enterprise clients, the more selective marketplaces often have a rigorous vetting process. One popular example is TopTal.
TopTal: With the tagline, “Hire the Top 3% of Freelance Talent,” TopTal boasts a network of skilled freelancers and selective clients. It caters mainly to freelancers in software development, design, and finance. If you have a few years of experience in one of these industries, TopTal may allow you to expand your reach into more exclusive and lucrative markets.
The third marketplace category is the one with which most customers are most familiar since the advent of e-commerce websites like Ebay. These marketplaces are the virtual street market where artists and creators can sell their physical products. From the consumer’s point of view, these marketplaces function much like any other online store, except that the sellers are typically individuals. Similar to a street market where sellers pay vendor fees, these marketplaces facilitate sharing your products in a “store” and take a transaction fee on each sale.
Etsy: Probably the most widely known marketplace platform in this category, Etsy enables sellers to create an online shop to sell their wares. These shops are sorted into categories so that new customers can easily search for new products. While certainly less expensive than a brick and mortar store, fees can add up, so sellers should factor those expenses into their prices. Etsy charges a listing fee ($0.20), a transaction fee (5% of the sale price), and a payment processing fee (3% + $0.25).
Listing your services or products on a marketplace can be a useful way to start a successful freelancing career, particularly as you develop your product-market fit and customer base. Determining what you want to sell, to whom you want to sell, and how you want to reach customers are all important factors in choosing the right marketplace for you. Whichever marketplace you choose, SoleVenture is here to support you and help you run your business.