Upwork now takes 20% of freelancer earnings
forbes.com
forbes.com
They have also added a new tier - if you do more than $10,000 with a client, the the price drops to 5%. I know of companies with several full time remote contractors through upwork. This will be a nice improvement.
Yes it is nice for the highest earners. But very tough on the others
I already feel I have to be cautious that I am not exploiting people. This makes me doubt if that can be done anymore.
https://community.upwork.com/t5/Announcements/How-new-pricin...
In addition I think it's weird for a company who should be all about scaling and automation, to say that smaller jobs are costing them significantly more to service than bigger ones. The differential should be negligible. I'd be interested to see the detail on that.
In the worst of the two, A freelancer defrauded me and several other clients through the Upwork platform, taking our money hourly while promising work but never delivering anything and then stopping all communication. I have had a "customer care" case open for 33 days so far and after dozens of emails they are standing by the freelancer even though his account has been suspended and they acknowledge he did the same thing to other clients.
I emailed the Upwork CEO Stephane Kasriel about this,skasriel@upwork.com, but he did not respond :(
There is also freelancer.com but the pricing for both parties is VERY shady and complicated. I have tried to hire from there, but I have very bad experience.
There is definitely room for another big and trusted player in this market.
It'll certainly reduce number of small projects (e.g. install WP plugin) which Upwork makes less money from.
I might still consider using Upwork for small projects if I think they have a good chance to turn into long-term relationship with a client.
For medium projects there it'll increase fees from 10% charged to freelancer to 10%+2,75% – this hurts a bit.
On larger project the fees go down a little from 10% to 5%+2,75%. When you work for same client for over a year and think of the fees charged every month there's great tempation to cut out the middle man (prohibited by Upwork's ToS but hard to enforce). Even small reduction in fees will keep bigger contracts longer on Upwork – and it's where they make most money from.
Separation of payment processing and commission is a good move and makes the commission appear smaller. Besides for bigger, US based clients possibility to pay with alternative methods and reduce total commissions to 5% + 50$ flat fee is a further incentive to stay with Upwork longer.
But how many big big/entreprise clients do they have? If you have any insights how much of their massive profit comes from those 50 dollars WP plugins?
While browsing Ruby on Rails jobs I often saw client profiles with more $50.000 spent. Yes they have some big fish to cater for.
Those clients (and freelancers like me) might consider higher commission for first 2-3 months of work (to reach $10.000 threshold) as kind of recruitment cost. Then, 5% commission is acceptable for payment and accounting automation.