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when Steffi first called me
and mentioned the theme
of the conference patterns that
connect we started to
brainstorm about
some of the emerging and
exciting businesses that we are
seeing in Silicon Valley and
around the United States and around the
world that
leverage a theme connections
and leverage of the
power of the web and the internet
and one of the areas that
we have been focusing on as
a forum are businesses
that
provide direct
access between
people that create products
services content can't and those who
purchase it effectively
this is sort of mediating
a lot of the middle man
that we have historically seen
we have also seen the emergence of
businesses that really
leverage the power
of the web for productive use
frankly rather than just
you know entertainment or
passing leisure time
and so when
we start to brainstorm
about the panel
I decided to reach out to
a hand full of companies that I
believe are really representative
of this
category of this emerging
trend and are really pioneers
and leaders in their category
so with that I would like
to introduce our panellists
and then have a very open discussion
around some of the trends that we are seeing in the
business and then we will have some
time towards the end of our
discussion for questions
from the from the audience
so why don't I start off by
by introducing my panellists
starting to my right
Danae Ringelmann is
co-founder and CEO
of Indiegogo
I will let her talk about
Indiegogo and what she's
doing we are very excited to have Renee here
to her right is Garry Sword
Garry is
CEO of oDesk
a great company that's really
pioneering a lot in the in this
category
and again happy to have Garry fly over from the Bay Area
with me and
last but not least Oleg
from Fotolia
Oleg is currently
on injury but he made
it out here even though he has a broken
foot and we are very excited to have
Oleg CEO Fotolia here as
well so why don't I kick
things off by having
each one of you describe
in brief detail how
your company got started and then
maybe give us a quick snapshot of what
your business looks like today
so why don't we start off with you Danae so for those of you who don't know
Indiegogo is the largest global
crowd funding platform in the
world we are in over 200
countries and just dispersing
millions of dollars every single week
to entrepreneurs, artists and non-profitable
causes
all across the world
the way I got started
actually was a very
personal experience I was
working in finance on
Wall Street doing that by
day and I got
roped in to helping
some film makers and theatre producers
by night to try to help them raise money
the old fashioned way I
actually met a very old elderly
gentleman who had been making
films his entire life and when
he faxed me a script
pretty much begging me to finance me
just because I worked at a bank
I knew that something was broken pretty
badly and since I was
22 23 and pretty much had
no experience but then I
started working with film-makers I produced
a one night event in Arthur Miller play of Broadway near
New York City did
everything perfect packed the
house got actors
to volunteer their time invited
investors there with the goal that they write
the cheque at the end to turn it into a big
production everything went perfect
according to plan except the last bit
where they turned to me and said this is amazing
we love this project we are not
investing we have got other
objectives so it was in that moment that
I realised that the people
who wanted this idea to come
to life the most which were the actors
and the audience had no power
and no mechanism to
actually make it happen and
that just showed me how the
system was broken so I went
back to business school started to
start a company to democratise fund
raising and it's there
that I met my co-founders that came from
technology backgrounds and and
said if you really wanted to democratise
anything you have got to take it online
and that's when we started Indiegogo
this was before the word crowd funding even
existed back in
2008 and our whole goal was to
empower the world
remove the gatekeeper we
didn't believe it was our right to decide
who had it who has the right to raise money
or not but truly provide the
platform where anybody anywhere in
the world can raise money for whatever they are
passionate about and that's what we are doing
great so you could not ignore that
request I I get a lot of those
from Nigeria and I usually delete them
so Garry oDesk
hi I'm Garry Sword I'm the CEO of oDesk
and oDesk is the world's largest
online workplace where we enable
companies to do is to
hire manage and pay
talent via the internet so
what companies like Amazon
eBay have done for e-commerce
find the right good get delivery of the good and pay for the good
oDesk has done for democratising
the world of work find the right
worker get delivery of the work and
pay for the work via the internet the company was
started with this mission in mind
but it was a little bit of the securest route
our 2 co-founders wanted to work
together one was in Athens
the other in the Bay Area
and they worked at a company named Intact and
the CEO of Intact didn't really want to work with this
guy from Athens he said how are we going to
manage him how are we going to work remotely
and so we developed a
platform for
working with people remotely and then try
to sell that and everywhere we went
to sell this for managing remote workers
people said well companies said this is a really
cool platform can you
also connected us with the workers we
need PHP-programmers we
need IOS and so we
started by
the light bulb went on that really was
about matching
the best talent with
the best companies and bringing
the work to the worker
via the internet as opposed to the worker
to the work the traditional
way and that is how the company started
we are doing that today we are in a 160
countries we are the
largest company in this space
did more than 35 million
of hours worth of work last
year which is an eightfold increase
since 2009
thanks Garry Oleg
yes so Fotolia is a leading
marketplace for stock
photography so any
photographer in the world can come
and create an account on Fotolia and we
have our internal people
who review the quality of
images and once they will be
accepted it will enter our search
engine and on the other side people
who need who need images can
come and licence them so
the business started in
2005 and I
was in fact is selling my previous business
which was web hosting company
and I was thinking what to do you know
something where I don't need to wake up at
nights to reboot servers
and at the same time something quite
useful and as a start up
we will always needed images for everything
for newsletters
for blogs
for our website and even our
customers as opposed they were
asking for images but
by that time it was very very
expensive because if you would want
to licence an image with Getty
you would have to pay between
100 and 300 dollars
so this is how the idea came
and I thought okay I will buy a camera and trouble the world
and we will not have to reboot servers any more
at night and we will just do
pictures and as soon as we launched
the platform in fact we realised
that I was not the only one who liked photography
but there are hundreds of thousands
of photographers who are
kind of frustrated because they didn't have
distribution nowhere and
so unfortunately I couldn't travel I had to
build a
platform and the business and today
we have presence
all over the world the website is in 15
languages and we
licence around 100 thousand
images per day great thanks
so why don't we just start off
by getting an understanding
of how you
differentiate in you various
segments
so why don't we start with you Oleg
you know in your category
there there are a couple
companies that there are mentioned companies like
Getty Images and Shutterstock maybe you can
give us a sense of how you
differentiated your
platform for
photographers versus say the
other companies Getty is a little bit another
business because just price-wise
it's a legacy business
and they licence images totally with a
with another price point so
it is true that we have a few competitors like
iStock or Shutterstock and
but I think today we are a little bit
in an oligopoly
there are like 2 or 3 companies
and we are doing a little bit different things
our main difference in Fotolia is
that we started in Europe
so we have a lot a lot of
European we were the first one here so
so we we got the benefit
of the European viral effect
so and we have a lot of
photographers and very deep
connections with with the buyers in
Europe and and our model
is more a on demand model so
you can come and just buy one
image while other companies
I mean some sell subscriptions and
some are more US I would say focused
okay Garry your category
well I think it's 3 things for us you know
one is scale we are the
largest company in this space
so I think in these
businesses and in the marketplace
business you need chickens and eggs buyers
and sellers and we have almost 3
million contractors that
number grows by a couple thousand
every day that come on to our
platform the second is
clients we have more than
550 thousand
clients who are buying on oDesk
so what is scale you don't build
these businesses overnight you have
to get ready for the long
haul the second is our business
model we've best
replicated the way that work
happens in the offline world
which is mostly time based
sites that came before us were
really focused fixed price
and that fixed price model is a little a bit
race to the bottom how much to
build this widget people bid
on it you through the the widget over the
wall the money over the wall and you
end up with hopefully the right thing but that
tends to be really
small fixed price
projects what we do is we connect
people on the basis of
time and then we can guarantee
work to the client we guarantee that I
hour build is actually an hour worked
and we have software to help manage
that and then we can guarantee that hour
work is actually an hour paid where we
take the risk of
collecting the money morning and we
guarantee it to the contractors
so we are the only platform that
guarantees work and guarantees
payment which enables us to stay
in the middle which is a very different shape of
business model so I think it's a combination
of scale the business model and the liquidity okay
so Indiegogo is unique in
4 specific ways
first we are totally open which
means we are inclusive once again
we do not set out to be a
gatekeeper we wanted to do away with
that so we have written a platform
where anyone can create a campaign
where everyone in the world which makes
brings us to our second difference which
is we are global in all most 200
countries the third is
that we are data driven so just
as we don't
pick and choose which projects come onto our
site so we have everybody from entrepreneurs to
artists to charities and non-profits
we also don't pick and
choose who we promote it's
all automatically driven
via algorithms
so we use classic Silicon Valley
Google Ask crowd funding
platform where
we use
algorithms and data to
determine who we promote and
specifically one of the algorithms we
have is the gogofactor which is
an algorithm that measures the activity of a
campaign and the response to this
in the community and together
the higher your gogofactor the higher your placement
on the site the higher your promotion
PR all that stuff and what's so
powerful about that is we are the putting hands
back into the hand we are putting the
power back into the hands of the creators
and their audiences determine how
successful campaigns are
you don't need to send us cupcakes and beg
to be on our homepage you determine
that not us and then the
third reason
or the fourth reason is we are obsessed with
customer happiness
so in that we have to funding
models we have the fixed funding model and the
flexible funding model you can pick
whichever one works better for you
in the fixed you set a goal
you get your money only if you reach your goal
in the flex model you set a goal and you get your money
whether or not you reach your goal
there is different use cases for both and then we have a
24 hour global customer
happiness team and yes it is called customer
happiness because that is what
they do it is not to
support but it's education
so we have entire insight series
from our data science team
that extract data to
empower all of our customers
to make the right decisions on how to run a
campaign to reach success got it great
so no cupcakes I got it all right I will put those away
global open data driven and
happiness yeah there is actually a lot of good
themes here
so why don't we start off with
with a macro view you know when
when I look at the vintage of
your companies here you know we obviously have some
companies that are very very new from a
longevity standpoint
and then some of them have been around a little longer than
others but you all kind of hit your
stride and are all doing very well
in your businesses
so maybe we can start off with you Garry you and I have talked
about this in the past but what do you
think is it about
you know the world in 2012
2013 that really has
allowed for these globalised
democratised
platforms that
you know this sort of mediate frankly a lot
the middle man has really hit
their stride now versus
say even a couple years ago
well I think you know if you look at software
as a service sales force
didn't start by selling to big firms they
started by selling to small and
medium businesses and the world
wasn't ready to put their customer data
in the cloud it
started with the small businesses and that
is actually where we started and we think there's 3
enablers one is
the internet the fact that not
only is there more bandwidth
but there's more tools for
communication and collaboration
with things like Sky and platforms
like oDesk it is easier now
for us to work from where
ever we are in the world and make it
seem like we're in the same place and
the internet helps to enable that
the second is
globalisation the fact that
the world is getting flatter
oDesk is in 160
countries we have over 45
hundred companies customers
in Germany and it's
embarrassingly my first time
I have been to Germany so we are seeing
a real global lift and a lot of the
work is crossing a border
so it's not just that companies
want to go global it is that
the talent has to be global
98% of the
dollars earned from German
contractors originates
outside of Germany so these are clients
that want contractors in
Germany similarly
30% of dollars earned by
American contractors
workers on our platform originate
offshore so it's truly global
80% of the work in our
platform crosses a border
the third trend is the
economy I think in this economy
companies are trying to get more
work done for less and
similarly there's a lot of people
that want to work and make money they want the
freedom and flexibility to
work on the jobs of their choosing
from wherever they are in the
world and to be able to make the wage that they
are worth so it truly is
democratising work enabled
by the internet
globalisation and the economy
Oleg in your business have you seen similar
you know trends I think we life more and more
in a visual world world ten years ago
nobody had a website or 20
years ago so and there are
40 million companies
or even more you know small and
medium companies in the world everybody
has a website and people
communicate more and more with
images if you just look at
Facebook I mean Facebook is mainly
a photo-sharing website
I would say and you see
trends Pinterest you know
people like imagery and
plus we have a nowadays I mean more and more
devices like iPads or iPhones and all I mean
you can't communicate much
better I mean with with imagery so
so this
is the main reason why a
platform like Fotolia I mean could
explode I would say in the last
years and keep on growing I think
has your has your business like Garry's benefited from
a lot of the economic turmoil that
we have seen over the last couple of years yes for sure
because what we get still
now I mean emails every day from
companies who are just
thankful to the fact that we cut their
budgets you know marketing budget
by 10 or 20 you know
because instead of licensing for
300 dollars an image they can have
something legal now for 1 dollar
with us so of course
I would say that
it's a benefit for us a direct benefit
the fact that there has been some turmoil
for sure it has definitely helped us okay
so similar trends on your side as well yeah I mean
well forever the financials
how the access capital has been
inefficient and difficult and unfair
process so that hasn't changed
and so that was just a kind of
the environment that we walked in to
so when social media came on came on to the
scene which it has been
for the last 10 years and it has really
risen all my payments had
become ubiquitous and the fact that
we are online 24
7 those 3
trends in
conjunction with finance being
a difficult unfair and
inefficient process just was
like the perfect storm for crowd funding
to rise and take off
when we have campaign owners like
Matt Inman who wanted to
raise money to build a museum Nikola Tesla
he died he was
under represented in the history
books and so he wanted to take his former lab
and turn it into a museum that
was going to cost you know a few million dollars
so he went to the New York state government said you should fund
this the people the New York state government said well we
are not sure we are supposed to represent
the people why don't you do this why
don't you raise money from the people
up to 850 thousand dollars and then we will
match that because that's a way to
prove that the people actually want it
and that is indeed what he did he raised
1.3 million in a matter of
days or weeks and then now they funded
this museum same thing
with this small business owner who is a
bakery owner she really wanted
to so he unlocked the
capital from the government with his
crowd funding campaign same thing with the small business
we had a bakery
in New York who had been
had just started it was you know
9 months old
it had done the thing that you do you get a small
new business loan
10 thousand dollars to get your business
going she is doing quite well
selling her gluten free macarons
out of her garage and had the opportunity
to get distribution in a regional
grocery store chain which would have been a huge
growth spurt to her business
the only problem she need to update her packaging
which was going to cost 15 thousand dollars
which for a small business you don't
have 15 thousand dollars as working
capital sitting on the side lines every
dollar goes back into your business so she went back
to the bank you know says have this
huge opportunity can you lent me
another 15 thousand
they said congrats
on the opportunity there is no way
we are not lending you that money
you are far too young you don't have enough track record
you haven't paid back the first loan
good luck come back to us in 2 years so here she was
sitting with a huge growth opportunity at her
finger tips that she couldn't access because the
traditional financial markets were
letting her down so she turned to Indiegogo raised the 15 thousand dollars
by pre-selling
macarons to her current
customer base who then brought in
friends and family
and Facebook friends and Twitter
followers and all that kind of stuff because they were passionate about
her gluten free macarons and long behold
she builds her audience she raises
the money she gets her product in
the grocery store within a month
6 months later she is distributing her product
across 40 states in America huge growth storage
ended up on the stage with president Obama when he signed the jobs act
which is the act in America
to legalise crowd investment our equity crowd
funding which is the ability
to to invest which is a
movement where we are part of so so
why don't we why don't we stay on this
topic on on the kind of more
on the on ground tactical level because
you raise pretty good examples
with the Nikola Tesla museum
and the and the lady with the with the bakery
before you know just a quick question of the audience
how many of you have
funded some type of
project or cause online
raise your hand
okay so you know a quarter at most so I think
for a lot of people particularly that aren't ()
the notion of
funding something like the
bakery or pre-ordering
online is still an alien
concept
so maybe you can talk about
in the causes or project
that you guys have funded what
drives people to fund these
project what do they get in return
is it just to feel good or do they
want early access to big goods
what are some of the
the drivers to get people involved
yeah we talk about the 4 P's
the 4 reasons people fund passion
participation pride and
perks there's a fifth P called profit which is
not yet legal in the US but that might
be happening soon because of the
jobs act but the first is passion yeah
they want to see this idea
happen they are just uber-passionate about
the cause the person
the experience the idea they want to see it happen
if you want to build a coffee-shop
in your neighbourhood and you don't want a big chain start to move in
fund the coffee-shop for the price of a cup of coffee
you can have a coffee-shop for life
I mean it is pretty simple second is
participation so
a great example this is my sister
so she is married with a kid but she is
passionate about women's
issues and about violence
against women's issues and there is a campaign
that was a product that was a cup
that changes
colour when a *** drug has been
added to it so it is pretty impressive
so she is trying they are trying to get
these cups distributed across bars across
the world because it would be very useful
to fight against *** and so she funded it
not because he's going to
bars every night again she is
husband kid etcetera
but she is very passionate about the cause and if she can make
a statement through funding without giving up her day job
she is going to do it
it makes it very easy to participate in a
movement larger than yourself third is
pride so we recently had a
campaign you might have heard of it there
was a woman who was bullied on a
bus her name was Karen Klein
and some young kid took a video of
that that campaign of the woman getting
bullied put it on YouTube went viral
a guy saw it in Canada and said I can't life with this
I need to do something about it so
he created a campaign to raise 5
thousand dollars to send this woman
he didn't know on vacation
because he just felt so bad for her
that went viral they raised
700 thousand dollars in a
matter of weeks the woman went on a very nice vacation
but what we started seeing where
people saying things like
I was the fifth funder out of
30 thousand or I was the
hundredth so I discovered this thing
early we're seeing that a lot in
product and gadget campaigns for
example we just had a
campaign to raise money
for a very elegant design
similar to a Fitbit but it is called the
Misfit Shine they raised almost a million dollars
because people want to be the
early ones in I know VC's
and angels know that concept
quite well you want to be the first one in but
they're doing it because of the
recognition and the pride factor and then the fourth
reason is the perk they
want to the actual thing
so a lot of campaigns use crowd funding
use Indiegogo
to pre-offer their
actual products as well which is a
great way to test you market
the Misfit Shine is a great
example they
had actually raised venture money but
they really didn't know who
exactly their market was
how many units they should produce in their
first run so they used crowd funding
as a way to test that and they actually learned
that what they thought that was the market
validation effort was
actually an effort to
smarter much faster as what
they said because what they learned is they learned
the type of the features
that their funders wanted the
colours the accessories
far quicker because they were able to
test it by offering perks
so 4 reasons and you know who knows if
profit comes into play then it will be a whole exciting ball game
yeah I know it is interesting when I have used
the sites what
I've seen that I think is
really most intriguing
is the ability to put
your money where your mouth is particularly
around issues that you believe in
there really have not been any other
platforms like that in the past
or products that you want to see to come to life
exactly the market validation idea
behind some of these projects
are really fascinating to me
Garry on your platform maybe you can give us an
example of
something that you have been able to
empower that has really changed
someone's life or has
really demonstrated the power
of what you can bring to the well I think in the
marketplace business with buyers and
sellers you have to add value to both sides
or it is going to be hard to stay
in the middle and so what oDesk
has done we have really empowered
businesses to
get access to talent that they
can't find in their local
geographies so despite the
fact that the economy is not
great the talent war is
full on I in the Bay Area
you can't find good
engineers and even if you can
find them you can't afford them
and it is very time consuming it takes up to
90 days to to hire
and on our platform it is more
immediate you find the right
talent out of 3 million
contractors we are going to help you
find a match with the right one
we're going to enable you to
contract with them what are you going to
do and what are they going to do we are going to help you
to manage the work
as if they were in your own office and then
handle all the payment and statutory compliance on
a global scale so
businesses on oDesk you know they are
coming to our platform every day to get work
done that they could get done
locally much more on demand much more
immediately and what they have told us is
that when we asked them what would you've
done if it weren't for our
platform more than 70%
said they would not
have hired locally so these are jobs
that didn't exist so we call this
lift not shift these
are not local jobs that are
going to the web these are jobs that are
happening because our
platform exists now similarly on
the contractor's side
we are enabling contractors
to have the freedom and the
flexibility to work on the
jobs of their choosing from
wherever they are in the world and
to make the wages they are worth and I mean there are just so many
examples of this but you
know a guy in Bangladesh
can't find a job he ends up
finding a job on oDesk
he applies to
the job he gets
invited to an interview he gets the
gig at 5 dollars an hour
which is like 10 times
what he was making
prior to being
unemployed and then within 3
months he is making 30 dollars an hour
because his skills are
just that good his buyers keep increasing
his wages then he brings
all of his friends onto the
platform and now they have created a
guild if you will or a group
of developers that all work
together and they are all making in the neighbourhood of
30 dollars an hour which is far more
they can make in their country so
really it is democratising
work enabling businesses to
get more work done and
contractors to get access
to this work without a
geographical limits what's
one of the most
complex projects
that you have seen this ever been run on your platform
so interesting
statistic 4
in 2007
4 categories
accounted for 90 more than
90% of the work today that
number is like 35 categories
so we are really seeing very much like eBay starting
with Beanie Babies and pest dispensers
moving to collectibles then
Rolexes and cars
we are getting pulled out into
Rolexes and cars and these are
things like
now more than 40%
of the work is none IT
so it's
everything from really
complex translation
to there was a a
job for a long term
theoretical physicist who even know
who can even say it let alone have it on the platform
there is
bio-informatics
accountant lawyers any bankers there yet
any bankers not yet huh we'll check okay
how about you Oleg
I think we have a lot of examples of lives
changing because before
people didn't have access to
distribute images so it was
just a passion and they had kind of a day
job and thanks to a platform
like Fotolia and (name)
we have a lot of people who in fact quieted their day job
and became professional photographers
so so that they
can really do the work they like
and we have examples of people I mean earning
much more in fact of what they used
to earn before during their day
job and so this is the
I would say on the supply side a very
good example and on the demand
side I think we also give
more more more creative
we unleash creativity
in a way of designers
because for the price they had to
pay for one image before now they
can buy a subscription at Fotolia
and have kind of unlimited access you know to
raw material on
which they can work so so
it's better for the creativity so I think it is a benefit for both sides
So you have all given
great examples of of
success stories and
you know plurally you guys have all built
amazing businesses that have a
marketplace dynamic Garry used the
words chicken and the egg which is always
clearly a challenge with marketplace
businesses talk to us
about how you keep
the bad actors out
of the marketplace because in my view
it is really the bad actors
the lack of
you know closure
of transactions that really
can degrade a marketplace
so maybe you can talk a little bit about how
you keep the
vibrancy and the liquidity
within you marketplace going sure I can start
so we do that in 3 ways in the first
is not really our
doing it is just the dynamics of crowd funding
what is different about crowd funding is that
we have an one to many relationship
versus a one to one on a marketplace
so given that we actually have a
lot more data and a lot more
information and a lot more can
kind of hurdles to get over for
people to actually be successful
so you don't have to just
convince one person to give you money you have to convince many people
so given that it's it's much harder
to you know commit
fraud or or do things
like that the second is just as we are data
driven to drive
promotion we are also data driven
to fight bad apples
so we have algorithms that catch
stuff quicker than the human eye
to keep things keep the site clean
and the third is we have just followed
best practices from PayPal and eBay with
with community policing which we haven't had
to rely on too heavily but it's there
just in case yeah this is a hard problem
for us because you know more than
50% of our traffic
are customers come
from referrals so
friends who get a great
result tell somebody else and and
it's viral in that regard
but it's hard to deliver a great
result if you are not in the middle
of the work so we don't
take responsibility for the
project we are merely the platform
that enables you the higher the
right work manage that worker and pay that worker
so for us it is really hard
because sometimes it could be good buyer
and a good seller just
they don't have a great relationship right and so
in addition
to all of the things that Danae
said about you know leveraging
best practices
from other marketplaces we
have a lot of those folks that are now employees at our
company around fraud and
trust and safety and when you
can pump money out of a system
you really have to have
mechanism in place because there's
there are a lot of bad guys out there so we got
all of that but what we work on
every day is improving the
quality and once you have the
liquidity in the early days
we were very much high
touch we used to hand
screen everybody that
came into the network both on the buyer and
the seller side and that worked really
well the problem is it's not
scalable so we realise
that we open up the
floodgates attracted a lot
of users and now we have to
ratchet and back down and implement these levels
of quality and so we
focus very much
on buyer and seller's
satisfaction we use NPS
to measure a Net Promoter Score to see
how we're doing in that regard and it's a
challenge for us every day
Oleg how about you
so I think the need for for creative stills and video
I mean is here and will always
be here so our main challenge is
is to keep I mean the
user experience as
good as it can be so Fotolia works mainly as
a search engine for
images so of course we
we would put a lot of efforts to
have a really good search and
ideally to show I mean
immediately you know
the the the best image I mean
of what the the customer I mean would
would want to see so this is one
of the big effort I mean we are doing on the
search site and then all the user
experience so it's constant work
to keep the that in a
so why don't we kind of look out into the future
a little bit here I
personally am very excited about
the future of these direct access
business models but I would love to get
your take on what you
see the future in this
category or another
category this ultimately this sort of mediate the middle man
say a couple years from now do you think
that this will be very
pervasive you think that
that every industry will have
companies that effectively matched
buyer and seller directly
I would love to just get your take on
how you see the industry evolving
shall I start again sure okay ladies
first so yeah I actually I
just wrote a blog about for Good
magazine because
you get asked this question a lot like where
are we going and I
fundamentally believe that
we're heading in a very positive
direction and
specifically for crowd funding
crowd funding is becoming
this permanent piece and
complementary piece of the whole
financial ecosystem
it's not necessarily replacing
anything but it is becoming a
new piece and the reason it's becoming permanent
is because it's actually making the entire financial
ecosystem healthier so what do
I mean by that I mean
crowd funding is now become
a way to incubate great
ideas which will then
make the job of the traditional
financier easier because their job
is to find ideas
and amplify them well how do they
find ideas they work their network
they like you know try to
source in every which way it's
very inefficient but if you have a
platform that's
allowing businesses to rise to the top
community projects rise to the top
artists rise to the top based on community
validation based on market
validation people wanting these ideas
makes the decision making process
much easier for traditional
financiers which span everybody
from VC's banks to
labels and studios
and arts as well as non-profits
and governments kind of in the non-profit
community cause arena
so what I'm what I see happening
is there is going to be a shift
from the role of the
gatekeeper from one of decision
maker to just one of amplifier
which will then will be
less risky still great returns
and so the whole system will be better
because you know traditional financiers will
be just better at their job so that's why
I think it's changing it
permanently and it's also changing
it for good like for the
better because then the right ideas are
coming to the top because it's based on efficient
marketplace dynamics not based on if
you happen to have a rich
uncle that works at a bank or know
a VC etcetera which was the
fundamental problem that drove me to start this
company to begin with
yeah I know I'm certainly
very optimistic and excited about the
future of the market
validation side of this
so you know I know many
many many main stream companies they are all starting to think about
using platform like yours to really
effectively test future demand
for product and I think that that's the
future for a lot of companies that are
focused on de-risking new product
launches yeah 2 words that we get a lot from
VC's and labels
and non-profits and foundation
is thank you so I think we're just
really just getting started on the world of
online work when we go and ask our
customers we have more than
550 thousand
customers they come back and they
tell us that when we
make their business more competitive
which I think is a great sign
and more than 80% of
them tell us they will continue to work
this way so once they try it they say
we can imagine at least some
percentage of our work
working online is opposed to on
site for all of the reasons we have
spoken about access to
talent the the savings on fixed
costs alone you don't need an office or
computer a phone or a desk and
then to mention the fact that it's on demand so
there's the benefits
and the like of having a remote
worker and of course the fact that
when you tap into a global
supply there's there's wage
variances as well so
you can tap into the best worker the
quality worker at the price that makes
sense for your business so we are just getting
started businesses say
it makes them more competitive they will continue to
work this way and I think evidence
in our business we are getting pulled in 3
directions one we are getting pulled
into bigger firms some of the
largest internet brands in the
world are now using oDesk
to to get access
to a global on demand workforce
so one quick example
is a very large company
needs people in Belgium that speak
Dutch and Flemish they also need
people in Thailand people in
Germany where else can you
go in the world to hire this
distributed on demand global
workforce we have hundreds of
people working for that client today
doing localisation
we are getting pulled into more categories
as we spoke about earlier
now what used to be 4
categories making up a
bulk of the work is now
35 categories so very
eBay like in getting pulled out
and we are getting pulled more globally
so while we are still very much centred in the middle
small businesses mostly
technical work mostly
onshore offshore we are getting
aggressively pulled in every
direction and we think
by 2020
1 in 3 people will
work online as opposed to on
site and it will be for this
freedom and and boundless
opportunity we think there will be
more blended teams
comprised of both online and
offline workers we have a
120 employees in our
company we have 2.5
times that in on demand
contractors most of our
developers are in Eastern Europe most of our support
team is in the
Philippines so we eat our own cooking
in that regard and I think we are just
getting started total market is about a billion
dollars this year and we think it will be
just an aggressive growth from here on out
I also think Garry is you and I have
talked in the past you know there is
some very interesting social
implications as well of
platforms like yours you know
people not not just being self
serving because I want to work in my
pyjamas but like for people that
can't move can't you know
travel frequently they can at least
leaver productive lives
you know on platforms like yours as
well and so hearing
numbers like that 1 in 3 is very
compelling I think for a lot of
people makes people more
productive for a lot longer
do you measure your social impact yeah
you should yeah we should we we have
lots of different I mean
I give you a 100 anecdotes of you know the
woman who had cancer and lost her job
could not get
another job started working on
oDesk at 12 dollars an hours
she's outside of LA today she's
50 dollars an hours and she has more
work than she can handle she is making more
than she was making prior to her
surgery and the and you know she came into our
company and spoke at a company meeting
there was not a dry eye in the house
right I mean it is that kind of an impact that makes us
feel good great Oleg yeah for sure me me I
can speak about the more on
the creative side but for
sure on demand I mean there is a huge
structure for that and we at Fotolia
we also own a platform called
Welogo but it is more for
designers where where
companies can post a tender you now for
example for a logo for a
design and that would get like
hundreds of propositions
and can work you know with
with the cheapest one for example
until they choose one
so so I think for the the supply
side it's a it's a lifestyle
because a lot of people can work
from home you know some people don't like
so much you know any more nowadays you know to
go to office I mean it is less politics
also you don't depend necessary on
on on
on people salespeople you know
who need to go for you I mean and
find job you just get the tender
but but on the other side it is true that it is
also I mean a little bit more Wild
West we have to I mean to have
eyes open about that
because because it's huge
competition so it means you don't have I mean
any kind of security you really need
to be the best you know to be
able to win
so it's a trade-off here
I think for the for the client I mean
at the end of the day it's better
because they have more choices you know they pay
they they they probably pay less I mean but
you need to be really good on the other side
interesting so again because of this open
democratised marketplace
you are going to see more and more of the winner take all
dynamic particularly if you are the best at
whatever specific
area that you are in a little bit
on Fotolia we see a little bit that I mean we
try you know to to
also through algorithms to
to to work
a little bit on this but for example our best photographer earns
I mean really a very significant
amount of money over a 100 thousand dollars
a month I mean just in royalties a lot
so so it is true that there
is always a little bit the risk of you know
of a
winner takes all yeah okay
we'll open up to question from the
audience has anyone have any
questions I have another one
so one of one
of the things that that I try to do
when I think about new emerging areas
is I follow the money and all of
you have a traditional
venture capital in
your business at least historically
and I think that's not surprising
what is surprising is
you 2 in particular have investors that
we don't normally
think of we think about
your emerging categories
high growth categories you have
T. Rowe Price as an investor and you have
KKR so maybe you can just
give us a sense of how
investors are thinking about this
category not particularly your
investors unless you want to comment on that but just
in general how are late stage public investors
thinking about this
category Garry are they
thinking it is mainstream are they is
T. Rowe really the the
first of many to come or are they more of a
one of well I think Henry Ellenburg
and the T. Rowe Price is a pretty
prolific investor
he manages 10 billion
dollar New Horizons Fund
and he tends to invest he looks
for 4 or 5 private
company investments a year and
I think his criteria are category
leaders in very very large
markets and so the world of
work is pretty large
and if you think about how work is getting done
today it's on premise it's tamp staffing
agencies our it is
outsourced it's thrown over the
wall for somebody else to do
and I think he looked at us
as a new innovative way to get work done via
the internet right I mentioned it earlier
e-commerce is a lot like
online work find the right good get
delivery of the good pay for the good
find the right worker get delivery of the work and pay for the work
so I think he looks for category leaders
he looks for good teams
let me pull my arm out of my socket and pet myself
on the back he looks for good teams
and we have a pretty seasoned executive team he
also looks for you know
all of the dynamics
high growth businesses
ones that are profitable that are
that have the makings of a a very
large business so Oleg you have
private equity which
is more traditional
associated with leverage buy outs
first we never had a VC I mean
Fotolia was self-funded
so we never took
money from from anybody
but the reason why we had
some private equities because
part of the partners you know wanted to
cash out so it was also
one of the reasons and and the reason
why they invested is
yes it is true that KKR and so do so many
I mean internet investments but
they have more the financial
approach so they look at high
growth you know good teams
again you know very strong cash flow
businesses and very big markets
so they did their homework you know and
they did believe that Fotolia is
very well positioned in to
continue growing and that's what we
did the right any questions I think
everyone has got it figured out
well we're basically out of time
here I like to thank our panellists
for having a very forward
discussion I'm I'm very excited about
the category I think there is going to be a lot of
pioneers in this category
a lot of wealth being created in these categories
as well so my hat off to all of you
for building great companies and
I'm sure you will be available if
anyone in the audience has some questions afterwards
thank you very much for coming thanks David