Upwork's Financial Results and Forecasts for 2023

[#1]

I just attended Upwork's Stockholders annual meeting for 2022 and their forecasts for 2023.

It was a very interesting meeting and below are my takeaways from the meeting in no specific order. Feel free to ask any questions.

- In 2023 40,000 Clients have signed up for longer term hiring on Upwork and 2,000,000 Freelancers.

- Upwork lost $89.9 million dollars in 2022 with a possibility of becoming profitable in the second half of 2023.

- The current focus is to generate more revenue from existing clients versus adding new clients in the first half of the year.

- Clients are taking longer to make purchasing decisions due to the macroeconomic conditions.

- Marketing spend will drop 12% in 2023.

- Companies are in Phase 1 of 3 phases of economics. In English - companies are scaling back and are cautious.

- Upwork is very excited about AI and stated that during the past 4 months AI posts are up 39 x!

- Upwork stated clients are purchasing from freelancers that produce their work using AI because it reduces client costs.

- Indirectly stated skilled freelancers are in more demand and less skilled in less demand.

- Upwork sees the first half of 2023 as challenging and the second half to be better based upon their enterprise sales team.

My takeaway is that freelancers need to be incorporating AI and expert level Skills or risk being less in demand. Expect the first half of this year to be slower due to the economy. AI and the economy have taken the show for the next six months.

This is a recently written Post with the SECRETS to growing your Upwork Sales at:

https://community.upwork.com/t5/Coffee-Break/THE-Secrets-to-Growing-Your-Upwork-Sales/m-p/1229943#M5...

This is a recently written Post with the SECRETS to hiring freelancers on Upwork at:

https://community.upwork.com/t5/Clients/SECRETS-to-Growing-Your-Business-On-Upwork/m-p/1235553#M8984...

[#2]

William,

Very interesting and thanks for sharing the information.

• Upwork lost $89.9 million dollars in 2022 with a possibility of becoming profitable in the second half of 2023.

This one is a bit strange to me. With the influx of freelancers and clients since the start-to-middle of the pandemic, I would think Upwork's 2022 numbers would break even or be in the black.

• Upwork is very excited about AI and stated that during the past 4 months AI posts are up 39 x!
• Upwork stated clients are purchasing from freelancers that produce their work using AI because it reduces client costs.

Was there a discussion about the specific types of AI posts or the type of AI work being sought? I'm wondering if more clients are requesting AI-driven engineering and tech solutions or AI-generated writing, data, and content production, etc.

[#3]

Hi Clark,

Upwork has never been profitable, but hopefully by 2024 is my guess.

AI everything is going crazy whether on Upwork or other related sites. Yes tech solutions are hot. As a Marketing Sales expert, I have been getting all types of AI clients because everyone thinks they have the next hot AI service.

[#4]

I think Upwork is in a good position to be profitable in 2024, but I guess we will see.

Back during my software engineering / application development days, I would have been deep into these AI/ML enhancements. I'm following it now, but I have only helped a few clients explore some human-machine interface, AI/ML, task and cognitive modeling, and data fusion through technical writing.

I may need to brush off the old development skills and get more involved. I don't see AI/ML getting weaker any time in the near future.

[#5]

It will be worth your time to brush up on the old development AI / ML skills because it will be a goldmine for Expert developers with those skills.

[#6]

Clark,

I am amazed at the number of freelancers wanting to know what has happened and is happening with Upwork that are ignoring this post that contains the information directly from the CEO. Instead are creating complaint posts.

[#7]

Well, I think you and I both know the hard truths about that. A lot of folks will not spend time searching for and reading valuable posts, taking Academy Learning Paths and lessons, or delving into Upwork's financial and business operations. If they did, they would understand a lot of things much better, and the questions being asked in Upwork's Forums would be sliced in half.

I guess we are all apathetic when it comes to some things. But if you really want the knowledge or you really want to understand something, you would be willing to do the research. For a lot of freelancers, cold hard cash could be a motivating factor to do more reading and research, but many still don't.

[#8]

This is pure truth Clark

[#9]

How do you think it will assist those freelancers to know that Upwork is super enthusiastic about the changes that are rapidly diminishing the opportunities for them on the platform?

Side note: I doubt freelancers looking for solutions to problems like having trouble getting hired anticipate that they'll find useful information about those issues in Coffee Break.

[#10]

---

Clark S wrote:

Was there a discussion about the specific types of AI posts or the type of AI work being sought? I'm wondering if more clients are requesting AI-driven engineering and tech solutions or AI-generated writing, data, and content production, etc.

---

There is very little AI in the physical engineering sector. As I alluded to in my post on the subject and one commenter further clarified, most of the tools are iterative generators that produce attribute- or path-optimized shapes, with no regard to their manufacturability. Most of the machine learning tools are used for feedback sensing in manufacturing processes, such as spaghetti detection for 3D printing, catching defects and spoilage. Others are used to do part analysis, such as the DFM analyser and sheet metal feature interpreter in Solidworks, and for shape indexing, such as Thangs' 3D geometry search function.

[#11]

I posted a message/question to your post on the subject.

I'm guessing Upwork is not the place where clients will be requesting any earth-shattering AI-driven engineering solutions. Like you said in your post, the 3D modeling and additive manufacturing software like Hyperganic are only available to commercial/research entities, and it will likely be that way for a while.

[#12]

Clark, what is your favorite computer languages?

[#13]

Back when I used to be an actual developer, 😂 I really enjoyed C++ and Java. I'm REALLY dating myself, but my undergrad degree is in Computer Science, so I started with Pascal, Borland C, and Basic, and even dabbled with a little COBOL and some assembly languages. (I'm sure anyone under the age of 35 thinks I'm speaking in riddles now!)

I enjoyed those 3rd-gen languages because you were forced to be an actual developer who understood logic and the underlying hardware, etc. I'm not saying today's languages are "easy," but the 3rd-generation was the "golden age" in my opinion.

Around 1998, I realized I needed to switch to languages that better support web and web application development, and move away from those powerful languages like C and Java that were being used mostly in the engineering, medical and manufacturing industries.

Today, I really like PHP, Python, JavaScript, some ASP.NET {C#), and SQL, since I prefer SQL-based databases over No-SQL databases. I rarely build anything with these languages/scripting these days. Plus, I have heard many developers say that a scripting language is not a true programming language.

What about you?

[#14]

COBOL? So you are one of the few capable of fixing the databases used by the unemployment offices throughout the USA!

[#15]

😂😂And, believe it or not, used by a few smaller banks and medical care facilities throughout the USA!

[#16]

Here's the dilemma, clients are demanding higher skilled people, upwork is pushing full time hire. Expert talent is not settling for a single clients full time job (and budget), they want to be independent and they want to focus on most complex problems.

[#17]

Well, the full-time change is just the addition of the "Contract-to-Hire" tag/label. It uses the exact same conversion process that was already in effect, with the same conversion rate. It's truthfully just a marketing ploy to try to win customers who are spending their time on the Indeeds/ZipRecruiters/Glassdoors of the world.

[#18]

Jonathan,

I thought it was absolutely brilliant for Upwork to target Enterprise clients and match to their Expert freelancers. Within the past 24 hours, I have already been asked to apply for 4 of these types of jobs and Upwork takes out 0% fees. Upwork seems to be serious about this endeavor. Upwork lost $89.9 million in 2022 so they need to up their marketing sales strategy.

[#19]

I wondered about that label. Freelancers aren't employees. It sounds to me like they're trying to be both employment agency and freelance site...

[#20]

Alper,

It depends on the freelancers skill set. The jobs for my skill set range from $300,000 to $500,000 annually, however most enterprise clients can only afford to pay for part-time, thereby opening up all kinds of opportunities for freelancers. I thought it was absolutely brilliant for Upwork to target Enterprise clients and match to their Expert freelancers. Within the past 24 hours, I have already been asked to apply for 4 of these types of jobs and Upwork takes out 0% fees. Upwork seems to be serious about this endeavor.

[#21]

Wow! Nice to know. It will be a great idea.

[#22]

William, you should check your photo's maths before posting. This lower simplification in this section is wrong.

That step should have been [a^(3/3) * a^(1/3)]^(1/3), eventually simplifying to a^(4/9).

[#23]

Too funny 😁

[#24]

🤣🤣

[#25]

The contradictions are interesting--clients are looking to cut costs with lower quality AI content content so they can save money, but higher skilled (and thus more expensive) freelancers are more in demand?