Last week they launched Freemarket.com, a domain name and website marketplace spun off from their $3.2 million acquisition of WarriorForum.com.
While some may think Freemarket.com is “just another” marketplace, what it offers is the community of 13 million potential buyers and sellers across all Freelancer.com properties, as well as the financial resources necessary to properly develop and promote this marketplace.
I invited CEO Matt Barrie and Product Manager Jimmy Young here to share some information about the newly launched Freemarket.com marketplace and how investors can be make use of parent-website Freelancer.com to develop their prized domain name assets.
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Michael Cyger: Hey everyone, my name is Michael Cyger and I’m the publisher of DomainSherpa.com – the website where you come to learn how to become a successful domain name investor and entrepreneur directly from the experts.
Last week I presented a tutorial entitled Selling Domain Names on Major Marketplaces. We discussed GoDaddy, Flippa, Sedo, DomainNameSales and Afternic. But today came an announcement of a brand new marketplace that competes with all these and brings with it a sister company that has helped millions of people find work.
Today I’m joined by two people from the company that launched the marketplace Freemarket.com. We’re joined by Matt Barrie, CEO and Chairman of Freelancer.com, and Jimmy Young, product manager responsible for creating Freemarket.com.
Gentlemen, welcome to the show.
Matt Barrie: Thanks for having us, Michael.
Jimmy Young: Definitely.
Michael: Great to have you. Let’s start with a general description of the marketplace, and then we will go back and learn a little bit more about the parent company, because I know Domain Sherpa audience watchers are interested in finding potential freelancers to work with them. So, how do you describe the purpose of Freemarket.com.
Jimmy: So, Freemarket.com is a marketplace to buy and sell domains and websites. And we really created this marketplace because our community was telling us that what was out there just did not serve the right purpose. It was too expensive and they could not find what they were looking for. So, Freemarket, it is free to list and we only charge a five percent commission, which is completely unheard of in the industry.
Michael: Yeah, that is low, especially when people go back, or if they have watched the tutorial that we have just put out, that is lower than anybody else in the marketplace. So, you mentioned your community. When you say your community, how many people is that community and what kinds of people do you serve in that community?
Matt: Well, I mean at Freelancer we have 13 million users across both Freelancer.com and also WarriorForum, which we have acquired about three months ago. And so, those of you that do not know what Freelancer is, we are basically eBay for jobs. So, you can go online and you can post a job, and get any of our 13 million people from all around the world to do any job you want. Now, the number one job done on Freelancer.com is website design, so we have had about 3.8 million projects that have been related to websites, IT, or (Unclear 3:20.0) software. So, a very large percentage of the Internet already has been built using Freelancer.com, and now with Freemarket, it is a great place to also buy and sell that piece of the Internet.
Michael: So, you have got millions of people using Freelancer.com and WarriorForum, and you have listened to them. In what ways do you listen to them and in what ways are they saying they want their own marketplace for buying and selling websites and domain names?
Matt: Well, I mean WarriorForum already had a marketplace for buying and selling domain names, and buying and selling websites. It was just tucked away in the forum as a subforum. So, for a start, we have kind of broken that out now to its separate site, but I mean the number one demographic really for buying established websites are Internet marketers. I mean they buy websites. Then they find a way to turn those websites into a platform for selling other products and services. So, we already had really one of the major buy demographic for transactions in the space. We also had the major demographic for building these websites in the space. So, we think putting two and two together makes a lot of sense to basically combine the two.
And look, I mean if you go through WarriorForum, you will see (Unclear 4:26.8) post after post of people complaining about the solutions that are out there at the moment. I mean I saw one poor individual that said, “Look, I just order this seller’s domain name I had for ten dollars and I posted it out there, and it cost me 20 dollars to sell it and they took my domain name. So, I have got a bill for taking the domain name off me.” So, yeah, if you sell a hundred-dollar domain name, I mean you are paying 20 percent in commissions away. I mean this is ridiculous.
I mean Freelancer really is sort of the Amazon of the online freelancing space. We have the widest selection at the lowest cost, and really it fits into our philosophy that there should be a platform out there where you can sell your domains and not have to pay a large fee. And we think that no listing fees is going to drive a lot of listings and the five percent commission is basically impossible to beat. So, really if you have got a domain name, if you have got a website, list it on the site. If it is listed somewhere else, it does not hurt to dual list it because there are no listing fees.
Michael: Yeah, the only downside is you have to remember to pull it off whichever marketplace it did not sell at. So, five percent. Are you going in with an offer that cannot be beat in order to try and steal market share from the other marketplaces, or are you just trying to go for the Amazon market – we are going to undercut everybody because our process is more operational effective than everybody else?
Matt: I mean this is our philosophy. I mean if you look at Freelancer and you look at the commission we charge there, we charge employees between zero and three percent, and we change freelancers between three and ten percent, where a lot of our freelancers are just paying three percent or paying five percent. So, it absolutely fits into our ethos that we just want to go broad. We want to go massive market. We want to be number one in the industry and we set the pricing to basically take the market.
Michael: Yeah. So, what types of domain names do you expect will be your sweet spot of Freemarket.com? Are you looking at like the ten-dollar domain names, where people only have to pay five percent, or when I go there, and I went there as soon as I read the press release and before we got on the show today, I see domain names that are listed as high as 1.25 million dollars?
Matt: So, it is really across the whole spectrum. We are not targeting a high end and we are not targeting a low end. I mean we have got a great community that we sort of poll out to. How many users was that, Jimmy, that we sent the poll out to?
Jimmy: We sent it out to 150 thousand.
Matt: It was about 150 thousand users, and from that we got 22 thousand people wanting to submit domain names and websites for sale. So, it was about 17 percent, I think if I do the math quickly in my head.
Matt: Sort of sample. And so, from that community, we got some great names. I mean already we have names like Files.com and Editing.com, Foreigns.com, etc.
Matt: So, we had to really span the whole spectrum.
Michael: Yeah, it is phenomenal. So, one of the problems that has plagues eBay.com over the past few years is the quality of the domain names. Everybody used to list their domain names at eBay for sale, but then the quality started degrading and going down, and now I do not know a single person that recommends listing their domain names on eBay. It is just full of really bad domain names because the listing fees are not that high, so it is a low bar to get over. How will you keep Freemarket.com free from low and no value domain names?
Matt: Well, I mean it is the same way that we run the other marketplaces we run. I mean the (Unclear 7:35.8) behind any online marketplace is really the reputation system, the feedback, and the curation from the community itself. And so, with that sort of experience in mind, we are looking at ways in which we can actually get the community to actually curate the good content from the bad content and really help us manage and coordinate and organize the site. So, it is very early days. We only have about a thousand domains listed at the moment in the first 24 hours, but as the site gets larger, we are going to have all these abilities to both filter content, find content, and curate the content, and I really think the powerful thing is the community. In any marketplace, you get the community to assist in getting things done and you have got a fantastic model.
Jimmy: Yeah, and we do not want to limit our users because a domain name that might not have a lot of value for one person could potentially be the exact thing someone else is looking for.
Michael: Yeah, that is true. I just find it difficult when you have to go through pages and pages of mediocre or no-value domain names in order to find the good ones, so I was interested to see if you had some solution that you have evaluated since you have been thinking about putting together this new system.
Matt: I mean Jimmy has got a huge roadmap, where we are going to (Unclear 8:40.4) a lot of information about each of the domains in terms of the metrics, the rankings on various sites. What the Alexa ranking is, the traffic ranks, the page ranks, and so forth. So, there will be ways in which we will make the really good content bubble at the top, so you will not be searching through thousands and thousands of pages of things that are irrelevant to you.
Michael: Nice. One of the other pieces of feedback that I hear from users of Domain Sherpa is that people at other marketplaces will default. So, they will create a brand new profile, they will bid up other people’s domain names, and then they just walk away at the end of it if it went too high, or whatever the reason. Do you have tollgates in place to prevent people from doing that, walking away from an auction?
Matt: Obviously we have got a lot of experience in running Freelancer in making sure that projects are bonafide and they actually completely get paid. And furthermore, the employee comes back and posts more projects. So, we have got a pretty experienced team that does things like KYC, customer ID checking. We have got systems in place to verify phone numbers and so forth to make sure that people are actually real people and not opening fake accounts, and we also have a pretty extensive anti-fraud team that sits there, monitoring the 13 million people in the community and making sure that everything is bonafide and above board. So, we have got a lot of experience in this field.
Michael: Excellent. Let me take a step up on the details of the marketplace and ask you two what do you see as the future state of the domain name industry now that you have just launched this marketplace that sells both websites and domain names. How do you see the domain names being a part of your future roadmap?
Jimmy: Yeah, so domain names are constantly growing. There are way more top level domains coming out every single year, every single month, but at the end of the day I think people will still want the premium domain names, like .COM.
Matt: Yeah, when you buy property in the real world, you want to be on the best street in town. And while you have got .NINJA and you have got all those, there will be a freeform explosion in domain names. I still think that if you want to attract customers to your site, you want to attract real traffic, that you want to make sure you have got a premium property to do it from. So, I think that every year, I mean certainly the industry is going to get bigger and bigger and bigger. I mean what is the online property worth globally? It is a trillion-dollar industry. In the future, the virtual property market is going to be just as valuable I think, but people still want to get the quality locations, the best houses on the best street, and the best locations in town.
Michael: Definitely. Looking out at future projections, do you two have an idea in five years how much of the Freemarket.com revenue will result from domain names versus built out and operating websites?
Matt: We do not know, and there are a lot of different directions that Jimmy wants to take this site. I mean he is look at apps. He is looking at real world businesses. He is looking. There is a range of sort of complimentary things that would fit in very much into this marketplace, but the thing for us is that there is 3.8 million projects that are being posted today that relate to websites in some way, shape, or form. Getting into that community and getting really active and getting them to use the site as their number one place that they actually list their content.
Michael: Great. Whenever anybody launches a marketplace, you always have the chicken and the egg dilemma. Do you get too much inventory up first, but then there is nobody to look at it, or do you just send a bunch of people to it, but there is not enough inventory, so they never come back? How did you seed Freemarket with one such great domain names to begin with, and then start sending the appropriate amount of traffic to it?
Jimmy: So, basically Matt alluded to this earlier, but from Freelancer we had 3.8 million website and IT projects, and inevitably people have domains and websites they want to sell. So, it is basically coming from our community, and that is how we really got the initial push to launch the market.
Matt: Yeah, we sent out a poll. We hit a small sample size of about 150 thousand people from basically Freemarket, so Freelancer. And from that, we got 22 thousand responses. We sent them an email and in the first 24 hours they listed a thousand domains. So, it is very, very, very early days, but we are in the process now of sending out campaigns to both people on Freelancer and also on WarriorForum, and we expect it is going to build up rapidly over the coming weeks and months.
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Michael: Yeah, I have no doubt you are going to see a ton of domains being submitted. I know people that have tens of thousands of domain names. Do you have the capability to accept, say, five thousand domain names in one fell swoop and add them on to a portfolio of a user on Freemarket.com.
Matt: Yes, so you are building an API to do that, right?
Jimmy: Yeah, definitely.
Matt: We are building out an API and a bulk upload facility.
Michael: Excellent. I did not see any links to Freemarket.com from Freelancer.com, which is an Alexa top six hundred website in the world. How do you plan to promote Freemarket and kickstart the activity besides sending out the emails?
Matt: It has been 24 hours. Jimmy has been working around the clock. He has had his team working all weekend to kind of just get out the door. He has a massive list of things to do in terms of cross-linking and promoting and so on, so yeah.
Jimmy: There is a lot to do.
Matt: He is a bit burnt out right now. He is a pretty humble sort of guy, but he was in here all weekend with the headphones on, just kind of, you know, cracking out the code.
Michael: Awesome. So, you are actually coding as well as product managing it, Jimmy?
Jimmy: Well, I have kind of moved off the code now, but I was one of the first people to write the first line of code.
Michael: Awesome. Boy, so is your background in programming, Jimmy?
Jimmy: So, yeah, I am a computer science graduate.
Matt: He is one of the top grads actually from his class. Everyone in the company are freelancers. I have got a computer science degree. I have also got an electric engineering degree. I mean everyone at the company has some sort of advanced engineering or technical background, so that is kind of the philosophy we have. Everyone here is a geek in some way I guess.
Michael: Well, we love geeks. So, let me talk about Freelancer.com for a little bit. For anybody that does not know the history of Freelancer.com, it is a phenomenal story. You founded it back in 2009.
Matt: That is right.
Michael: You acquired a tech freelance job sites, vWorker and RentaCoder. The IT marketplace, Scriptlance, which I have actually used for years. I actually found my Chief Technology Officer off of a Scriptlance job that he did for me, probably about five or six years ago. And that of course was rolled into Freelancer when you acquired it in 2012. 2014 you acquired Freelance Marketplace based in Poland. And then you went IPO in late 2013. Is that correct?
Matt: That is correct. November of last year. It was actually a tremendous IPO. It was the third biggest opening ever on the Australian Stock Exchange. The stock was up four hundred percent in the first few minutes, so it is a pretty phenomenal success. So, yeah, you are right. We have grown this business a lot by a lot of M&A and consolidation space. We have acquired 13 marketplaces in one way, shape, or form over the last four and a half years. So, it started with GetaFreelancer out of Sweden. It was (Unclear 15:47.1) vWorker. (Unclear 15:52.0), which is the Polish site, for example, this year. And then the one we are really excited about in the last three months is WarriorForum.
You can see Jimmy is wearing the t-shirt, which is the world’s biggest community of Internet marketers. And the warriors, this is an amazing community. These guys are really at the ground zero of entrepreneurship, building businesses, promoting businesses, selling online, creating new products, creating the future. We are really, really excited with this community. And I mean this website as well. It is the top 250 website, so a huge amount of traffic there. It has been running for 17 years. And obviously in that marketplace you can buy and sell products. You can hire people. You can do a range of different things, but hidden away was actually a domain name and website marketplace, which we have now used as well to sort of seed the content for Freemarket.
Michael: Right, and I can see why you do that, because I did not even know about it. I have been on WarriorForum. I have an account on it. I know people that I do call warriors that go after it. They are entrepreneurs. They are digging down. They are looking for any way to produce revenue, and they are on WarriorForum. They are looking at the deals. They are starting deals. So, from my research, I found that you acquired the 730 thousand plus marketing professional forum for 3.2 million dollars. Is that correct?
Matt: It is. We had to release the numbers to the stock exchange. It took me four years to acquire the business. I have got an email chain with Allen that goes back to 2010, where it took a long time to close, but we are pretty excited because we have kind of taken it to the next level. I mean Allen did an absolutely amazing job building the business to where it was today, and we have the resources and the capability and the capacity and the engineering team to really, really get to the next level. So, we have only had the business for about three months. We have already launched a payment system for it. We have made a number of improvements to the site. We have moved it to our Amazon AWS and improved the scalability of the infrastructure.
We have built a support team around it, and now we have also built out a marketplace around domain name and websites that was there for 17 years. No one really knew about it.
Michael: Yeah. So, you have got a phenomenal platform, both for freelancers, now for selling websites and domain names, and you have got all the communities that feed in and out of those platforms. Tell me, Matt. Why are you so passionate about freelancers, small businesses, and operationally efficient marketplaces like this? What drives you to create these?
Matt: What I love is I love the field of entrepreneurship. I love the fact that people are going out there and creating businesses, because being an entrepreneur, the great thing about being an entrepreneur, particularly a small business or a technology entrepreneur, is you get to create the future. You get to come up with new products and services that change the world around us, and to me that is really exciting. It is amazing. And with Freelancer, we have two types of entrepreneurs we really, really empower, and one is really the small business owner at home and he may be only like a gift shop in Kansas that wants to get something done or something manufactured or a website built.
And they are all entrepreneurs because they are running their own businesses, but they may be under resourced and have not a lot of time or money to actually get things done. We empower them with the digital workforce, and at the same time we are empowering all these entrepreneurs in the developing world, being freelancers, who are really going out there and starting companies for the first time, helping small businesses (Unclear 19:22.9) get things done. So, we kind of sit in the middle of this sort of global phenomenon that is going on, and then on top of that we have got the whole WarriorForum community, which kind of (Unclear 19:30.7) the elite entrepreneurs out there who are kind of at the really cutting edge of creating new products or services. So, it is really amazing just having 13 million just really passionate people who are just going out there and just creating businesses and creating products. I think it is just a really, really amazing place to be.
Michael: Yeah. You mentioned that website development was the top freelancing-type job on Freelancer.com. Is that correct?
Matt: That is correct. The big categories are the website design, graphic design, Internet marketing, copywriting, data entry, and so forth, and mobile phone app development.
Michael: Great. So, I know that there is a lot of viewers of Domain Sherpa that have phenomenal domain names, like great single-word generic domain names worth probably high five figures, six figures. Can they go to Freelancer and find someone to do the design for them, do the programming, do the testing and launch their website on something like AWS?
Matt: The easiest way to raise the value of your domain is actually put a website on it. That is actually generating a bit of revenue or generating a bit of traffic. So, absolutely. I mean we are the number one place in the world to go out there and get a website built really cheaply, but really high quality, as well as get the graphic design done. Maybe get a logo done. Whatever it may be, and also promote the business. So, you can hire Internet marketers to help you get traffic. So, really I mean if you have got a domain name portfolio, I mean it is an obvious thing to do; is to go out there and get some freelancers to help kind of build up the property. It is just like buying a vacant lot on the street. You buy a vacant lot. Let’s go build a house on it. You increase the value of the property.
Michael: Yeah, definitely. But if I am going to build a house, so let’s say I own a great piece of vacant land that is worth a lot of money and I am going to build a piece of property, I am probably going to hire somebody to tell me, “Should I put a duplex on it? Should I put a quadplex on it? Should a I build a single-family home?” What is it going to be like in the future? Can I go to Freelancer and hire somebody to help me figure out a business plan, a best how to monetize a certain domain name before I even hire anybody to design it and develop it?
Matt: We have sections of business plans. We have sections of strategy. We have sections of brainstorming. I mean you could even post a contest. So, you could run a crowd-sourcing contest and come up with an idea, and have them compete against each other for the prize. So, absolutely. You can get anything done with a computer you can possibly think of.
Michael: Well, that would be cool because I know a lot of people that have great domains and they are willing to invest in it, but they are just not sure how to start and they are not sure that they have a great idea. So, the first things they can do is just go to Freelancer.com and start a competition or hire somebody. I guess they would post the job, and then people would apply, but without solving the problem yet, and then you would pick one to write the business plan, which is basically how are you best going to monetize it. What are the different options to monetize it?
Matt: That is absolutely right. So, you could either post a job in something like the business planning or strategy sections or the brainstorming sections and try and find someone who will prepare a plan. And as part of the brief, you can ask them to kind of submit a few ideas about what the plan might be about, or I mean the place that I think I would probably do it is I will go and post a contest. And you can post a contest in any of the seven hundred categories we have on the site, and have a contest for people actually to compete in real time with each other for who has got the better idea.
Michael: Oh, I love that. I think there are going to be some readers that are going to love that as well. Now, final advice on using Freelancer. If a watcher does not want to sell their domain name, or maybe they are going to list it with a buy it now price on Freemarket.com, but until then they might want to put some of their resources into developing the business plan, which might only increase the price of it later. Do you recommend breaking up the project into distinct pieces along the chain and using different providers for each of those pieces, like business plan, design, development, and things like that?
Matt: Well, I tend to like that because I tend to want to get the best of breed from each of those capabilities and make sure that if I want to get the best logo design, I want to get the best designer for that. I want to get the best programmer doing the back end. I want to get the best person coming up with the strategy, and so forth. So, I think if I was going to do it, that is the way I will do it, although we do have full-service shops that actually have maybe 50 or 100 employees who actually are top rated freelancers who will do the whole thing sort of souped-up for you.
And it really depends on what your budget is, how technologically experienced you are in order to manage the project and break it down and figure out what really the steps are. If you need some help, we do have an upgrade that is only 20 dollars. For 20 dollars you can post an assisted upgrade and you have one of our team experts actually help you formulate a plan and fill out your brief, and get the project and actually find the right person. But you can do it both ways. At the end of the day, I think you probably will get the best result if you do break it down, but that will require more work from your end in terms of thinking about what to do. It will probably cost a little bit more and will probably take a little bit more time to get it done, but you will get the best result in the end, but absolutely. If you have got a limited budget and you are kind of not sure what you want to do and you want your hand held, there certainly are some guys who will do the whole thing for you.
Michael: Excellent, and I recommend you head over to Freemarket.com and give the marketplace a try. Jimmy, if people have questions, they have suggestions, they have got great domain names, but they are not going to upload them because it is a little cumbersome and they just want to shoot you some feedback and maybe stay in the know on when you are going to launch your API or when you are going to allow a CSV upload of domains, and things like that, what is the best way for them to contact you?
Jimmy: So, you can make an account at Freemarket.com and will automatically notify you with any updates, or if you have feedback and you just want to ask me a question, you can email me directly at Jimmy@Freemarket.com.
Matt: Also, in WarriorForum, there is actually a whole forum that we have created where people can actually send us feedback and talk with other people, and kind of discuss features that they would like to see in the future. That is at WarriorForum.com.
Michael: Great, and I will have a link to that underneath. I will probably, right after this show, go over to Freemarket.com, create an account, upload a few domain names, and then show people what it is like to actually create the account and get them listed with a buy it now price. As you stated, Jimmy and Matt, the listing is free. You only pay five percent upon a successful transaction, so a transaction that closes.
Matt: That is right.
Michael: Any parting thoughts on Freemarket and Freelancer.com, gentlemen?
Matt: Well, we are pretty excited. It has been a big sprint to kind of get it out the door yesterday, but you have got a huge list of things in the back of your mind that you want to get out the door.
Matt: So, we are really excited to kind of get the feedback from the community about what they would like to see prioritized, where they see there is a gap maybe in the market that maybe we can take advantage of in terms of maybe features are missing or ways in which people are not doing it the right way today, or maybe improve either the business model or just how things are presented or how content is found. We are very open to that. We really want this to be the best solution out there, so we are very, very happy to receive feedback, positive or negative, because obviously negative feedback is one of the things we can improve.
Michael: Excellent. And I will vouch for the ability to get in touch with you guys and get queued up. You are obviously interested in the marketplace, which is exciting. I can sense that you guys are working hard on this. I appreciate just on a couple hours notice we setup this Skype session with you in Sydney and me in Seattle, and I appreciate you making yourselves available to come on Domain Sherpa and share with the audience.
Matt Barrie, CEO and Chairman of Freelancer.com, and Jimmy Young, Product Manager of Freemarket.com. Thank you for coming on the show, educating us about this new opportunity for buying and selling websites and domain names, and thanks for being Domain Sherpas for others.
Matt: Thank you very much for having us on the show.
Jimmy: Thanks for having us.
Michael: Thank you all for watching. We’ll see you next time.
Michael: Want a quick walk-through tutorial on how to post your first domain name for sale on FreeMarket.com? Stick around.
If you’re listening to this interview, visit DomainSherpa.com and search for Freemarket, then forward to the last 3 minutes of the video to watch this tutorial.
This on-screen tutorial actually took 8 minutes to record in real-time, but I’m going to speed it up so you can see the entire process in 3 minutes. But don’t worry, my voice and the description of the process will be in normal time.
Let’s get started. Visit Freemarket.com…[transcript concluded since the tutorial won’t be understandable in transcript format].
Watch the full video at: