Workana bets on Malaysia as springboard for growth
By Edwin Yapp October 16, 2019
- Aims to use KL as a springboard to grow in Asia; HK, S’pore targets
- Series A funded by Seek Ltd; working to profitability in two years
FREELANCE and gig economy marketplace platform Workana is confident that its move to set up its Asian headquarters in Kuala Lumpur will bear fruit in the near future, according to its co-founder Tomas O’Farrell.
The seven-year-old startup first began building out its software platform to match clients with freelancers in its home market of Buenos Aires, Argentina. It now claims to be the leading software matching platform for the freelance and gig economy market in Latin America.
Speaking with the Malaysian media recently, O’Farrell (pic, right) said Workana is targeting to grow “five-fold in the next year” and will use Malaysia as a springboard to other English-speaking countries in Asia, including Hong Kong and Singapore.
“We have a 10-person team in the region and are actively seeking to increase headcount to meet our growth goals and client demands,” he told Digital News Asia (DNA) on the sidelines of the meeting. “Soon we will have a sales division in the region, and intend to add 10 new team members,” noting that Workana currently had 90 people worldwide.
There isn’t a universal definition for the gig economy. The World Bank loosely defines it as organisations who contract independent workers for short-term engagements, while Investopedia says it involves companies which tend to hire independent contractors and freelancers instead of full-time employees on a temporary and flexible basis.
Asked what tracking metrics will be used to gauge growth, O’Farrell said this would include sign-ups and user engagement and conversions to help it get a clearer picture of the market opportunity.
On which countries it plans to go to next, O’Farrell said, “Southeast Asia (SEA) [and Asia by extension] is an exciting region, and we see a lot of activity in neighbouring countries,” he said. “That said, we are taking a conservative approach to further our expansion and will analyse the markets before committing to a specific country as our next target.”
Workana began life by bootstrapping itself, followed by a round of angel investment, said O’Farrell. In 2015, it ramped up its business and received a US$5 million series A round of funding by an unknown investor. This was then followed up by a US$7 million series B round by Seek Ltd in 2017.
DNA reported that in 2014, the Melbourne, Australia-based Seek acquired Malaysian dotcom boom survivor and one of the country’s most recognisable Internet-based companies, Jobstreet Corp Bhd, which runs online recruitment portal Jobstreet.com. The deal was then worth RM1.73 billion (US$523.5 million).
Quizzed as to whether Workana was is profitable yet, O’Farrell said “not right now.”
“We expect to see our first profits a couple of years down the road,” he said. “In the interim, our main goal is to continue our expansion and focus on firmly positioning ourselves as industry leaders in our field.”
As for future funding rounds, O’Farrell said Workana has “sufficient resources to continue its expansion in the region and run the business comfortably.”
“So we are currently in no hurry to fundraise. [Any] future fundraising efforts are really dependent on market opportunities that are presented to us and the growth plans we intend to execute.”
O’Farrell said Workana chose Malaysia as headquarters instead of other SEA nations because of three reasons. The first is that Malaysians are good with the English language and has the added dimension of being multilingual. Furthermore, they have good IT skills.
Secondly, Malaysia is business friendly and has a good quality of life. Lastly, there are many freelancers based in Malaysia and that the country is a good base to move on to other countries, O’Farrell noted.
“We have about 10,000 registered workers on our platform, of which two-thirds are Malaysians,” he said.
Quizzed as to what segments of the market Workana addresses, O’Farrell revealed that the three main sectors are IT developers, graphic and design and digital marketers, with others to follow suite soon.
O’Farrell also revealed that the profile of its members span from fresh graduates and stay-home-mums who want flexibility; retirees who have skills but don’t want to work full time; and middle aged experienced professionals who want to scale down and not work 70 to 80 hours in a fixed environment.
He said Workana connects freelancers to businesses looking to recruit a range of skilled professionals for diverse projects and continues to foster an ongoing relationship between two parties.
With a multitude of projects to choose from, freelancers are provided with equal opportunity to bid on the projects which they are passionate about, and it ensures both freelancers and employers find the right fit so that projects run optimally.
O’Farrell claimed that Malaysian clients are beginning to open up to the idea of employing freelancers as businesses realise the benefits of hiring people with niche skills and on a short term basis.
But he conceded that there are still challenges such as building trust that is needed between clients and freelancers.
“Education is the main challenge,” he explained. “It’s about convincing clients to give gig economy a chance. The other issue is to ensure that there aren’t any mismatched expectations for the job between clients and freelancers, and to ensure that payment is only remitted when the job is done to the satisfaction of both sides,” claiming that this is where the Workana platform can help.
O’Farrell said freelancers and clients can utilise Workana for free. The company takes a cut only when the two parties have agreed on the fees, O’Farrell explained.
“We start by taking 20% of the fees from both sides,” he said. “As returning customers come back, we scale down our fees down to 5%, which is the minimum."
Asked how satisfaction is met on both the client and freelancer sides, O’Farrell said Workana institutes a comprehensive questionnaire at the beginning of the process to filter out the right candidates for the right jobs.
Potential candidates are then tested both on hard and soft skills; hard skills are technical in nature while softer skills include language, negotiation and project management. After which, the platform matches best candidates to the best job.
On how it differentiates itself from the competition such as Freelancer.com, O’Farrell claimed sites like Freelancer.com matches the best person to the right job based on cost arbitrage or the lowest to the job.
“Workana’s proposition is to match local workers to local location, city to city if possible. This way, workers and clients are in the same time zone, speak the same language, understand the local culture. We believe this helps with customer satisfaction, which is the best way to promote Workana."