Gigster is shifting from letting anyone outsource full-stack app development to building next-gen tech projects for big companies. If an enterprise needs machine learning and vision, data visualization, blockchain, React or Swift work done and doesn’t want to hire full-time employees, Gigster assembles a squad of freelancers and guarantees the work at a fixed price.
With software eating everything, talent in high demand and tech rock stars seeking flexible schedules, Gigster is at the intersection of several massive trends. That’s why Redpoint is leading Gigster’s $20 million Series B joined by previous investor Andreessen Horowitz, and basketball legend Michael Jordan making one of his first tech investments. That brings the Gigster rocketship to $32.5 million in total funding just two years after launch.
“Since the invention of computers, new technologies have made programming languages exponentially higher level,” Gigster co-founder Roger Dickey tells me. “These shifts, combined with the ‘future of work’ accelerants such as freelancing and AI, have changed software engineering dramatically and will continue to do so.”
When Gigster raised its 2016 Series A, it had just three enterprise clients. Since then it’s scaled up to more than 40, with project size up 10X and revenue up 3.5X to the double-digit millions per year. That’s because enterprises can afford to shell out the big bucks for high-quality development. When budgets are tight with small-to-medium sized businesses, “we’re able to do a good job for the client, but not always as good as the client wants. It’s a bit of a mismatch,” co-founder Roger Dickey explains. “With enterprises, our satisfaction has been off the charts.” Revenue is up 2.5X year-over-year.
Gigster works with more than 1,000 top-of-the-line freelancers sourced from Stanford, MIT, Facebook and Google. They can earn bonuses through the Gigster Fund that pays freelancers part of the returns if projects it invests in successfully exit.
Gigster claims to have 93 percent client satisfaction, with 94 percent of projects within budget and 96 percent of milestones hit on schedule. Clients include Pepsi, Wyndam Hotels and MasterCard, as well as eBay, Square and OpenTable. They could struggle to recruit, or let Gigster take care of it. The #startup plans to triple in size by hiring 120 more employees with the new funding.
At its core, Gigster is fusing teams of freelancers with advanced project management tools and artificial intelligence to ensure gigs get done on time and on budget. That’s a rarity in the tech world, where the joke is that you should double any estimate you’re given about how long it will take to design and code something.
The frustration of finding gifted but reliable freelancers is what led Dickey to found Gigster. After building hit social game Dope Wars, selling it to Zynga where it was turned into Mafia Wars and working there a few years, he wanted to experiment with some new projects. He started Gigster with co-founder Debo Olaosebikan to make it easy for anyone to pay to get software designed, coded and delivered. It competes with traditional hiring and freelance marketplaces like Toptal, where clients have to manage projects themselves, with Gigster emphasizing its turn-key service.
From ‘build anyone an app’ to ‘enterprise code dirty work’
To fuel the enterprise pivot, Gigster raised the $20 million Series B from Redpoint, Andreessen and Jordan, as well as Y Combinator, Ashton Kutcher’s Sound Ventures, Marc Benioff and Quora CEO Adam D’Angelo. Dickey wouldn’t disclose the valuation but said “it was a substantial up round and we’re very pleased with the outcome.” Does Air Jordan bring any special skills to the cap table? Nope. “He was my childhood hero. It’s just fun to have him on the cap table,” Dickey laughs. “He didn’t put a ton into the round. We thought it’d be cool to have someone involved that we really look up to.”
Gigster already has luminary operators behind it, and chose Redpoint to lead the round because it’s a software-as-a-service expert. “We’re thinking of moving towards a SaaS model,” Dickey reveals. “It’s not going to happen immediately after the B round, but on top of selling [freelance development] services, we may sell some SaaS-based products as well.” He was cagey about what exactly those products would be, but they’d likely let enterprises use some of Gigster’s internal scoping and efficiency tools on their in-house projects.
“There’s a new model in consulting, combining freelance talent with automation tools. That’s the reason Gigster exists,” Dickey tells me. “I think now is the right time to start this company as there’s structured data on work. Companies are leaving data in Asana, Trello, Slack . . . they’re leaving digital footprints. Our platform sucks out that structured data.”
For example, Gigster has mapped out 1,000 past projects to build a calculator that automatically processes time and budget proposals for potential clients. Its “Supervisor” tool knows how code check-ins and communication between engineers and the project manager should ramp up as a deadline approaches. “If you don’t see those actions happening, there’s a 91 percent chance you’re going to miss the milestone date,” Dickey says, which lets Gigster know when to step in to nudge freelancers or make changes.
These tools and more like its Team Builder, PM Assistant and Code Librarian could be invaluable to companies working on lots of projects, and give Gigster a SaaS-subscription revenue stream where it doesn’t have to pay out a big chunk to its freelancer teams. With all its new cash, Gigster can pay to build more SaaS tools, buy sales people to hock them and its freelancing service and add more fulfillment staff to the 15-person team that ensures gigs get done within the guaranteed schedule and budget.
Not every company will be able to adapt to the software revolution on their own. And with advanced technologies like AI, blockchain and new mobile frameworks becoming more essential amidst a talent shortage, enterprises will need help. Gigster has a mercenary army at the ready.