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I think it could work out well for them. It'll certainly reduce number of small projects (e.g. install WP plugin) which Upwork makes less money from. I might

by wojt_eu 10y ago

I think it could work out well for them. 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.

angry-hacker 10y ago
It makes sense. But it will most certainly scare away the small players. 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?
- wojt_eu 10y ago
  Anecdote: I have logged 3700 hours on oDesk (before they merged with Elance into Upwork) for about 20 clients. About half of that was for two biggest clients. I think there's power distribution in play. 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.

by wojt_eu 10y ago

angry-hacker 10y ago

It makes sense. But it will most certainly scare away the small players. 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?

wojt_eu 10y ago
Anecdote: I have logged 3700 hours on oDesk (before they merged with Elance into Upwork) for about 20 clients. About half of that was for two biggest clients. I think there's power distribution in play. 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.