Israel’s Fiverr, an online freelance service firm, has publicly filed a registration statement with the U.S. Securities and Exchange Commission (SEC) for a proposed initial public offering of shares on the New York Stock Exchange.
The number of shares to be offered and the price range have not yet been determined, the Tel Aviv-based company said in a statement on Thursday, though press reports say the company could be valued at around $800 million.
J.P. Morgan Securities LLC and Citigroup Global Markets Inc. will be the lead joint book-runners of the offering, the statement said.
The startup has set up a platform that enables freelance workers to offer their services in a wide variety of categories at a starting price of $5, enabling users to buy and sell digital services in the same way they buy goods on an e-commerce platform. Using proprietary machine-learning algorithms, the company matches the buyers to the sellers, and provides them with standard contracts to do business “without time-consuming negotiations or uncertainty of pricing,” the filing said.
In the filing, the company said it had a 45% growth in revenues in 2018, and registered more than 50 million transactions since its inception, in more than 200 digital service categories in more than 160 countries. In 2018, Fiverr posted revenue of $75.5 million, compared to revenue of $52.1 million in 2017, and a net loss of $36.1 million for 2018 compared to a net loss of $19.3 million in 2017.
“We designed our platform to make it easy for our buyers to find and purchase the digital services they are looking for without time-consuming negotiations or uncertainty of pricing, while offering them what we believe to be the best value for their money,” the company said in the filing.
“At the same time, we enable our sellers to reach a large buyer universe, allowing them to spend more time on doing what they love and are best at, rather than on demand generation, contract negotiation, payment collection and other requirements of running a digital services business.”
“We expect adoption of freelance work by businesses to increase as online solutions, such as our platform, alleviate” the traditional challenges freelancers and companies face while doing business. Companies often find it hard to find the right talent, while freelancers face challenges in winning jobs and payment is uncertain.
“We estimate our total market opportunity within the United States alone to be approximately $100 billion,” the company said in the filing.
To date, the startup has raised a total of $111 million from investors including Qumra Capital, an Israeli VC, Bessemer Venture Partners, Square Peg Capital and Access Venture Capital and Cubit Investments.
The startup was founded in 2010 by Shai Wininger and Micha Kaufman. Wininger has since set up the digital insurance company Lemonade.
The registration statement filing comes as the much-hailed IPO of Uber, the ride-hailing firm, has been deemed a flop, after shares fell below its IPO price earlier this month, lowering its valuation to significantly less than the $100 billion it had hoped to attain as investors were said to be deterred by the firm’s lack of a clear path to profitability.