@Dana S wrote:
What I don't understand is why wait for everyone to get upset? Why not share those details from the beginning?
The good old American approach, top down.
Firstly, the CEO could not face the camera.... that says it all
"ONE OF THE BIGGEST COST IN OUR BUSINESS IS THE PAYMENT FEES"
And that is no-where more than 3% (Paypal, CC etc)
Thirdly, "We incur a lot of cost"???? Mind elaborating????
The freelancers already signup for packages... the clients now also pay the processing fee...
3rdly, "long term projects were siginificantly less expensive".... does that not make up for the relatively-more-expensive projects???
This may be true (hard to believe though) but where money is made is in repeat clients and relationships built starting small, you now have given every freelancer and client a reson to avoid UpWork unless they can swallow this price increase. UpWork, just like providers and clients, benefit from a long lasting fruitful relationship, thats insane to think that you are encouraging it by simply offering a discount at 10k. I closed my my acount today, its a sad day but UpWork forced my hand.
How can this be though? You have SO many small jobs going around and can hire one fte for every 12 you put to work. (Or for every 4 with the new rates). I do not have a clear estimate of the total amount of fte you put to work, but it must be quite a lot. Sure, there's overhead and hardware and software too. I also work in software development and we definitely do not have 10 or even 20% overhead on top of the cost for people. Maybe you should hire developers on your own platform (they're very cheap too!).
This page says Upwork does $1B+ work annually:
Now with new 20% cut for <$500 relationships and 2.75% fees for all projects from clients (or $25/month fees) Upwork must be expecting $100M+ extra profits this year. I hope this amount is going to be enough for your managers to fulfill their greed.
It would be interesting to see if they update the about page next year same time keeping the 20% cut. 10M+ registered freelancers currently, with 20% cut I expect 80% cut in the total freelancers number and these will be the freelancers who actually make money (not the ones strugglling to get their initial few jobs).