Customers: marketplace where supply is high end strategy, finance and marketing professionals and demand is large companies seeking compatible project work
Problem: disconnected marketplace currently driven by referrals, intermediaries charging massive brokerage fees (large consulting strategy firms, recruiters, etc.)
Product: online talent marketplace for companies to find high end business freelancers for short-term strategy, finance and marketing projects
My analysis: Companies like Elance and oDesk (which are two of my favorite later-stage companies) have grown tremendously applying the marketplace model to low-end providers of technology and creative talent. Yet the biggest growth in freelancing have been in areas of financial planning and analysis, accounting and legal strategy, where only behemoth firms have dominated.
By hiring through Skillbridge, companies don’t have to pay for the overhead of a traditional consulting firm. The existing strategy consulting firms are almost like high priced brokers – connecting their employees to their clients and collecting a large margin in between. These skilled workers haven’t previously had an efficient manner to get work other than to join a firm, but Skillbridge is making it easier to do so and is saving clients the premium.
The large consulting firms are taking the premium between what they pay their employees and what their clients pay. With a more efficient means for connecting these professionals with clients, Skillbridge has the opportunity to change this industry.
One of the social trends that Skillbridge is tapping into is people’s increasing desire for flexible work arrangements. More and more, people, high end professionals included, are seeking to combine pursuits such as travel, family, social engagement, and entrepreneurship with the ability to monetize their much sought-after skills as part-time freelancers. In fact, United States’ freelancers have grown from 6 percent of the total workforce in 1990 to 20 to 30 percent now.
It’s interesting that many of the qualified consultants in Skillbridge’s marketplace are stay-at-home parents and people who either aren’t in a position to work full-time or aren’t interested, but they are willing to take on smaller projects or part-time work with flexible hours.
Skillbridge is operating in a highly inefficient market (for both sides) and is getting great traction doing so. The demand from both sides is there, and Skillbridge is eliminating the barriers keeping it from becoming a reality by making it easier for these two sides to connect effectively.
Concerns: a) How important is “brand” to both companies and consultants? That seems to be why Bain can charge such a high “brokerage fee” and why positions at their firm are so highly sought after. With Skillbridge be able to change these beliefs and behaviors? b) Can they acquire consultants and clients at a cost low enough to make for a profitable business and be competitive in the space?
Team: Raj – Wharton MBA, strategy consulting. Brett – Wharton MBA, strategy and PE at Bain. Tony – former Hunch and ebay Engineer/PM. Very relevant backgrounds for the space they’re in. They’re working with some strong technical talent expected to be full-time after next funding round.