Fiverr International Ltd

  • Exchange: NYSE
  • Ticker: FVRR

Fiverr is an online marketplace for freelance services such as design, illustration and copy writing.


Fiverr

November 08, 2020

Thesis - Fiverr helps freelancers get work. Fiverr is an online marketplace that connects freelancers to businesses who require digital services such as copy writing, SEO marketing, graphic design, illustration and software development. The company’s mission is to make it as easy to hire freelancers as an e-commerce shopping experience, with all the same benefits: value for money, good selection and transparency of prices. Fiverr taps into an increasingly global, online, flexible and on-demand work force. The business model is simple - they make a 5% service fee from the buyer for any job booked plus as 20% transaction fee from the seller. So as the overall value of jobs booked on the platform increases, so does Fiverr’s revenues. The offline freelancing market is huge, so with a valuation of $6b currently, this business has room to grow.

Financials & Performance - Since it’s IPO in 2019, Fiverr has had strong revenue growth of around 40%, accelerating during cover-19 to almost 90%. Revenue was $52.3m so still fairly modest in absolute terms. The margin profile of the business is excellent, with gross margins of 80%. The company has a direct to consumer approach, meaning they don’t have a large and costly sales team. Although not yet profitable, they are getting close, with last quarter reporting just $0.5m loss.

Opportunity - Fiverr is still early in its business. As people get used to booking work online, you can expect that both the volume of bookings and value of bookings will increase. This is already showing in Fiverr’s numbers, with spend per buyer increasing consistently over time. There is also opportunity for further internationalisation. Whilst available in many countries, the majority of revenues come form English speaking markets.

fiverr active buyers chart