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⌨️ LinkedIn’s gig marketplace

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The Hustle
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Caliber

Stripe is finalizing a funding round that will reportedly value the fintech startup at $100B. For one of our Vietnamese-Canadian writers (we won’t say who), a related news story is even more noteworthy.

Mark Carney — the former governor of the Bank of England AND Bank of Canada 🇨🇦 — will join Stripe’s board.

The Big Idea
recruiter

LinkedIn is building a gig marketplace. What you need to know.

People love trolling LinkedIn.

The Microsoft-owned social network is an endless source of recruiting messages, corny inspirational posts, and voicemails from Jimmy.

Even so, its business is no joke: LinkedIn has 740m users and its revenue — from memberships, subscriptions, and job ads — hit $8.8B in 2020.

Now, LinkedIn wants to roll out a gig marketplace…

… called, err, Marketplace, per The Information.

The service is similar to platforms such as Fiverr and Upwork, which host freelance work from web design to home repair and make money by taking a cut (13%-27%) of the job.

LinkedIn’s offering will focus on white-collar work such as consulting, marketing, and writing. This is an extension of how the Marketplace project started in October 2019, when Microsoft acquired parts of UpCounsel, a startup that matches lawyers with small businesses.

Combined revenue for Fiverr and Upwork hit $550m in 2020

This is a drop in the bucket for LinkedIn.

However, The Information notes that Marketplace is more than just a revenue-generating opportunity:

  • Microsoft is working on a digital wallet to work across many of its services, and a gig platform will be a good use case for it.
  • The digital wallet will be a source of funds to help grow LinkedIn’s paid content network, where users can subscribe and tip content creators who bring them value.

The jury is still out on Microsoft’s acquisition of LinkedIn

It cost the Redmond-based software giant $26.2B in 2016. And LinkedIn’s revenue growth has slowed from 86% in 2012 to 20% in 2020, per The Information.

Microsoft tried to acquire high-growth business lines in separate deals for TikTok and Pinterest, but neither materialized.

While Marketplace will give more surface area for Jimmy to reach out to people, the reality is that moving the needle on Microsoft’s $143B in revenue is a tall order.

Snippets
  • Google fires a top AI ethics researcher: Margaret Mitchell founded the search giant’s AI ethics team and was forced out after she came to the defense of another researcher — Timnit Gebru — who left in a cloud of controversy in December.
  • What’s Up with WhatsApp: If users don’t agree to WhatsApp’s new privacy policy by March 15, they will have limited service and their account will be deleted by May 15. The app will allow the export of chat histories before that date.
  • ‘Doctor, we need help’: IBM’s Watson blew our mind when it dominated past “Jeopardy!” champs. That may be a highlight for the AI machine as IBM is looking to unload its Watson Health business, which was supposed to help cure cancer.
  • Uber takes an L in the UK, where the country’s supreme court just ruled that Uber’s drivers are workers and not “contractors.”
  • Bank on it: Brex — the corporate card startup — applied for a bank charter and has tapped a former Silicon Valley Bank exec to run it.

 

Q&A
Matt Barnes headshot

Former NBA Champ Matt Barnes is helping minority entrepreneurs thrive in the cannabis industry

Matt Barnes spent 14 years in the NBA, including a championship season with the Golden State Warriors. Since retiring in 2017, he’s been an active entrepreneur in the cannabis space.

He recently partnered with Eaze — California’s largest marketplace for legal cannabis — on the company’s Momentum program, a business accelerator for Black and brown cannabis entrepreneurs that includes a $50k grant for 10 recipients.

The Hustle recently spoke with Barnes to find out more:

What’s your background in the cannabis industry?

I’ve been a cannabis user since I was 14-years-old. However, I never realized the benefits during my teen years.

I’m not a drinker and don’t take prescription drugs but — during my playing career — cannabis really helped me tough through.

In my post-career years, I’ve worked with my alma mater UCLA and the NBA players’ association to explain the benefits of cannabis use.

What will you be doing with the Eaze Momentum program?

I’m trying to help open doors for Black and brown cannabis founders. I’ve personally been affected by the war on drugs, with my father going to prison for dealing.

With the [cannabis] industry booming, I want to make sure people of color can be involved and build successful businesses.

Is there a specific skill or lesson you are teaching the Momentum participants?

It’s really everything.

We’ve had situations before where minorities were awarded licences but not schooled on how to actually run a business. When this happens, they end up not building something sustainable and the license is taken back.

What is a major challenge in the industry?

Cannabis entrepreneurs need to be able to bank securely. Hopefully, they can pass a bill so that banks will be open to the industry.

Who’s the GOAT: Michael Jordan or Tom Brady?

Brady did win 7, but he also lost a few [Super Bowls]. MJ has 6 rings and went 6-0 in the NBA Finals. I gotta go with Mike.

(Read the full Q&A here)

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Caliber is a pretty unique opportunity — just check out their numbers:

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Small Business Feature
Adam Shlomi headshot

This entrepreneur built a $1m SAT-tutoring business from his bed

Tutoring is in Adam Shlomi’s blood.

In high school, the South Florida native and recent Georgetown grad taught others the secrets of the SAT and continued to do so on the side for years.

So it’s not surprising that when Shlomi suffered an injury in college that left him bored and bedridden for months, he made it his business (literally) to start the online service SoFlo SAT Tutoring.

At first, it was just him

But as positive early reviews poured in from his strong network of students and parents, Shlomi found himself setting up QuickBooks and hiring 100 tutors to keep up with demand.

Today, Shlomi told The Hustle, his goal is to “develop new client acquisition funnels to power growth.” One funnel leads to Shlomi’s cell, where he talks to potential clients directly.

Ironically, if SoFlo does its job, customers leave

So Shlomi makes their short lifetime value worthwhile by keeping customer retention high with charismatic tutors and by experimenting with new products and services.

A 30% dip in demand for SAT prep brought on by COVID could prove challenging, but the company’s growth doesn’t seem to reflect that: Revenue and profit grew by 600% in 2020 and Shlomi is expecting to 3x that in 2021.

And don’t worry about Shlomi solving a challenging problem — he scored a 1570 on the SAT.

Founder: Adam Shlomi

Number of Employees: 3 administrators and 100 tutors

Year of launch: 2019

Cost to launch: $1k

Funding methods: Boot-strapped

1st-year revenue: $150k

Current annual revenue: $1m

Want your company featured? Fill out our SMB survey. See financials on hundreds of companies by subscribing to Trends.

Meme of the day
Nyan Cat

Nyan Cat (Source: YouTube)

In 2011, Chris Torres created Nyan Cat. It’s an animation of a cat with a Pop Tart and… (well, pls just look at the pic above). 

The graphic has become a popular meme.

Well, over the weekend, a digital work of art based on Torres’ work sold for 300 Ether (~$590k) on a newly launched crypto art platform called Foundation.

The sale is the latest in the “non-fungible token” (NFT) craze, which is seeing digital assets built on top of the blockchain accrue significant value. We detailed NFTs in a previous write-up on NBA Top Shot — a digital card trading platform that has exploded in popularity: 

  • “Pre-blockchain, the creation of digital collectibles was a challenge.

Launched in 2017 at the height of Bitcoin mania, CryptoKitties (a game in which users buy, sell, and collect virtual cats) became the busiest address on the Ethereum platform — and demonstrated, for the first time, how the blockchain could power a digital collectibles market.

Generally, digital goods are easy to copy (think MP3s) and have no reproduction costs. As a result, it’s difficult to: 1) claim ownership over them, and 2) create value through scarcity.

Because a blockchain is a decentralized immutable record, a digital asset can actually be assigned ownership to a single entity. In industry parlance, this creates what is known as a non-fungible token (NFT).”

Missed the Nyan Cat sale? Christie’s is auctioning off an NFT-based artwork from digital artist Beeple starting on February 25. The estimated value is “unknown” since it’s the first auction of its kind.

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Companies

Gig worker rights battle moves to Toronto

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The battle for gig worker rights has come to Canada, where the Canadian Union of Postal Workers (CUPW) has launched the Gig Workers United campaign. It is the latest in the global movement to increase wages and improve working conditions for gig workers who rely on app-based companies for employment.

“We have to stand up for ourselves — the streets don’t look out for us, the apps don’t look out for us, so we’re looking out for each other and collectively calling out a bad business model,” Narada Kiondo, one of the courier spokespersons for Gig Workers United, said in a statement announcing the organizing effort. “The way it is just can’t continue — if the gig economy is going to work for our society then it can’t be based on squeezing delivery workers and restaurants for profit and dodging our labor standards. And we’re going to persist, and we’ll win, because our bodies and our livelihoods are on the line.”

The roots of the organizing effort were in a similar effort two years ago. The Justice for Foodora Couriers worked to unionize delivery app Foodora couriers. The German company expanded to Canada in 2015. Foodora claimed that couriers were independent contractors and not entitled to form a union. On March 4, 2020, the Ontario Labor Relations Board ruled that Foodora couriers were “dependent contractors” and therefore could unionize.

On April 27, 2020, Foodora announced it was closing its Canadian operations.

Jan Simpson, national president of CUPW, said the lessons from the Foodora fight are that gig workers have rights to unionize.

“The couriers have shown that traditional union organizing is possible in this space. But they’ve gone farther than that, with community-organizing tactics and collective mutual aid. They’ve formed a worker-led organization that we’re proud to support because their fresh energy and ideas are what it takes to improve working conditions and reject Silicon Valley’s model of exploitation,” Simpson said in a statement.

The battle for gig worker rights is expanding across the globe. Earlier this month, a court in the U.K. ruled Uber Technologies (NYSE: UBER) drivers in London were entitled to minimum wage, essentially making them employees. Uber had appealed a lower court ruling, but the U.K. Supreme Court rejected its argument, saying it was “clear … that claimant drivers were workers who worked for Uber London under ‘worker’s contracts.’” It also said the fact that an Uber driver could turn down work “is not fatal to a finding that the individual is an employee … and does not preclude a finding that the individual is employed under a worker’s contract.”

Read: Prop 22 wins in California; takes Uber, Lyft and other drivers out from under AB5

The nature of the relationship between Uber and its drivers means that the drivers “have little or no ability to improve their economic position through professional or entrepreneurial skill,” the court wrote. “In practice the only way in which they can increase their earnings is by working longer hours while constantly meeting Uber’s measures of performance.”

In the U.S., much of the fight over the status of gig drivers has taken place in California, where voters passed Proposition 22 in November with 58% of the vote. Prop 22 removed Uber, Lyft, DoorDash and other gig drivers from compliance with Assembly Bill 5 (AB5). That bill required companies to treat the drivers as employees.

Prop 22 did include certain provisions for drivers, including new earnings guarantees and health-care stipends among others, but it allows the gig workers to remain independent.

Click for more FreightWaves articles by Brian Straight.

You may also like:

Social Auto Transport raises $1.5M in seed funding to expand gig economy auto-moving business

Bringg’s collaboration with Uber opens new doors for e-commerce

Walmart to begin drone delivery pilot this summer



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African fintech startup ImaliPay raises pre-seed funding to service gig economy

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ImaliPay, an African-based fintech start-up is making waves by reshaping the future of work in the gig economy.

The Australian venture capital firm TEN13 reputed for investing in top-tier start-ups has invested an undisclosed amount of pre-seed funding in ImaliPay. ImaliPay joins TEN13’s growing fintech portfolio; the likes of Chipper Cash and Bookipi. Other investors included in the raise are; Finca Ventures, Optimiser Foundation, Mercycorps Ventures, Changecom, and super angels from Norway, Nigeria, UK, and Kenya. The primary aim of the investment is to expand and accelerate its growth and footprint in Kenya, Nigeria, and South Africa to be the one-stop-shop for gig workers’ financial needs.

TEN13’s backing of ImaliPay follows a recent string of events that has elevated the visibility of Africa’s Fintech start-up scene. “We believe this is a perfect opportunity to introduce our growing international network of investment professionals and investors to one of the most exciting emerging Fintech companies in Africa, ” said TEN13 Managing Partner, Stew Glynn.

The growth in the African gig workforce is being propelled by the growth in digitisation and smartphone penetration. Gig workers constitute a significant proportion of the economy within ImaliPay’s target markets and this market segment is expected to grow rapidly over the next decade. ImaliPay offers gig workers a one-stop-shop of financial services such as the ability to seamlessly save their income and receive in-kind loans through a “buy now, pay later” model tied to their trade. Bolt drivers in Kenya can now request a fuel loan and payback after 3-4 days, this allows them to get more work done and Safeboda riders in Nigeria can now buy on credit bike parts, fuel, and smartphones to keep their gig moving and reduce any downtime. Other products to be offered off the platform include insurance and investment options to foster a safety net for this hard-working but vulnerable part of the population.

ImaliPay was co-founded in 2020 by Zimbabwean Tatenda Furusa and Nigerian Sanmi Akinmusire who met whilst working at leading payments company Cellulant. They believe the backing of the start-up by a notable venture capital company such as TEN13 has tremendous benefits. “It’s a great opportunity for investors to participate in the fintech revolution and a fast-growing segment. Our vision at ImaliPay is to advance financial health and inclusion for gig workers who struggle to manage and access flexible financial services that are often only available to traditional SMEs”, said Furusa.

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EU seeks views on gig workers’ rights ahead of possible law

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By Foo Yun Chee

BRUSSELS (Reuters) – The European Commission on Wednesday took a step towards improving the rights of gig economy workers with the launch of a public consultation to determine their legal employment status and how to improve their working conditions.

Lockdowns to contain the COVID-19 pandemic have increased demand for casual workers as food deliverers have hired drivers, while cleaners, needed to battle the spread of infection, have faced health and safety risks.

Courts and regulators have meanwhile sought to correct the shortcomings in the gig economy.

The UK Supreme Court ruled last week that Uber drivers are entitled to workers’ rights, such as the minimum wage, and a Spanish court said in September that riders for Barcelona-based food delivery app Glovo were employees, not freelancers.

The EU executive said it wants feedback from trade unions and employers’ groups during the six-week consultation. A subsequent consultation will look into the content of a possible law by the end of the year unless unions and employers decide to negotiate the issue themselves.

“There is no going back as to how things work. The platform economy is here to stay, new technology, new sources of knowledge, new forms of work will shape the world in the years ahead,” the Commission’s digital chief Margrethe Vestager told a news conference.

“These are new opportunities that must not come with different rights, online as well as offline. All people should be protected and allowed and enabled to work safely and with dignity,” she said.

The consultation listed seven areas for possible improvement – the employment status of gig workers, their working conditions, access to social protection, access to collective representation and bargaining, cross-border aspects, the companies’ use of algorithmic management and training and professional opportunities.

Uber said it would work with policymakers and social groups on the proposal.

“Any legislative initiative should be grounded in what platform workers value most – flexibility and control over their work, transparent and fair earnings, access to benefits and protections, and meaningful representation,” the company said in a statement.

Small companies lobbying group SME Connect urged the Commission to expand the consultation to other groups.

“Looking at these issues solely through the prism of employees/employers’ organisations risks a failure to account for these platforms and those who work on them,” its president Paul Rübig wrote in a letter to Vestager.

(Reporting by Foo Yun Chee; editing by Philip Blenkinsop and Barbara Lewis)

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