Millenials don’t have the same linear career paths that my father’s generation had. They aren’t spending 40 years working at large companies like IBM. Many are using the smartphone and the cloud as their “IBM”. Look no further than what’s happening in the taxi industry. In many cases when you get into an Uber you’ll see that the driver also drives for Lyft, SideCar, FlyWheel, and other taxi-hailing services.
I had an experience a few weeks ago where one of my kids was sick and I couldn’t leave my home but needed someone to pick up cold medication. I opened up my TaskRabbit app and had the cold medicine within thirty minutes. I got into a conversation with the delivery person and he told me how he got a job as a Task Rabbit to help pay for his college education. It allowed him far more flexibility than a typical job would and he could earn more because his hourly wage was determined by the jobs he chose to complete.
This is the new labor force. People don’t need to be sitting at a desk to get stuff done and what was “virtual labor” in the early 2000’s has become a virtual magic wand for real world labor as I wrote about in my guest post for TechCrunch last week.
I noticed the first drop in the bucket of this trend while I was at Google. I joined in 2000 but it wasn’t until several years after when we had enough critical mass of marketers using AdWords, that we could syndicate them so that companies and individuals could display Google ads on their blogs and sites and earn revenue from traffic originating on Google’s search engine. I still remember how proud I was the first day that a writer told us he was quitting his job to blog full time because of AdSense. This revenue stream reinvigorated the publishing industry using a marketplace that allowed part time hobbyists to write for a living.
With all of these changes in the world, a new “freelance” economy is born; one that is full of independent contractors and entrepreneurs who set their own hours and prices. The unbundling of the workforce and freelance economy will need a variety of services from legal to healthcare to insurance and more.
This freelance economy is an emerging trend we’re very interested in at Metamorphic Ventures. We’re proud to announce our investment in UpCounsel, an online marketplace for legal services that makes it more efficient and cost-effective for businesses to get quality legal help.
For a small business, independent contractor, or entrepreneur, it doesn’t make sense to use a large law firm with fat, billable hours. On the flip side, lawyers don’t need to worry about partner structures and can make more money while working the hours they’d like.
With more and more small companies, startups, and freelancers entering the market, the need for affordable law work is a massive opportunity. In many cases in today’s world, there really isn’t a need for legacy law firms when a similar concept with the same deliverable can exist on a platform in the cloud. This is what UpCounsel has built and continues to build.
A growing number of companies are emerging in the freelance economy space like Zen99 which allows independent contractors to manage their 1099 work, Breeze which allows people to easily rent a car to begin earning money with services like Uber or Lyft regardless of their current financial circumstance, and most notably Zenefits which provides tools for small businesses to manage their HR operations. WeWork, which recently raised a large round of funding (congratulations WeWork) is also in the space, providing space and community for the freelance economy.
These new startups are disintermediating many of the legacy company structures we’ve gotten so used to. The transparency and efficiency of having a computing device in your pocket at all times is disrupting so many traditional industries.