VC Galaxy

VCs Are Pouring Money into the Freelance & Gig Economy

May 5, 2024
3 min

The world of work is changing dramatically.

Digitization, the change in the value scale of new generations (who now see work as a part of their life and not "their life"), and the vulnerability of the economy, which has led to massive layoffs from time to time, have completely changed the relationship that people establish with their workplace.

The idea of working in the same place for 30 years from 9 am to 5 pm is now a thing of the past (hello, boomer).

Work has become increasingly liquid, with people looking for more income sources to cover the rising cost of living as well as to diversify (I lose one, I don't lose everything).

A Look at the Freelance and Gig Economy

Online gig work is not just a trend—it's a dynamic shift in how we work and thrive. Freelancers and independent workers, now estimated at 154 million to 435 million globally, are becoming the backbone of the modern economy.

In the United States alone, a remarkable 36% of the workforce identified as independent workers in 2022, reflecting a 25% increase since 2016. This surge shows a clear preference for the flexibility and freedom offered by gig work.

How much do freelancers contribute to the economy?

Freelancers are a driving force in today's economy. Upwork's research (the world’s largest freelancer platform), shows that freelancers in the US contributed $1.27 trillion to the economy in 2023 alone.

Nearly 70% rely solely on freelance income, highlighting its growing viability as a career path. This aligns with the strong desire for independence – nearly 80% cite this as a key motivator, according to FreelancerMap.

Web design is the freelance service with the highest demand. Computer programming, marketing, IT, and business consulting are other important niches in the gig economy.

This skilled workforce is also surprisingly diverse. Contrary to stereotypes, nearly 13% of U.S. freelancers are over 59 years old, and over half hold postgraduate degrees.

Beyond technical expertise, soft skills are essential for freelancers. 70% emphasize the importance of communication skills, which will allow them to build strong client relationships. Additionally, 60% believe motivation is crucial for navigating the ups and downs of freelance work.

Trending Platforms for Today's Gig Economy

The digital freelance market is experiencing a meteoric rise. In just two years, its value soared from $2.35 billion in 2018 to $3.39 billion in 2020. This trend shows no signs of slowing down, with projections estimating a market size of a staggering $9.19 billion by 2027.

With freelance platforms currently accounting for only 1-3% of the global workforce, there’s a giant opportunity for growth. Startups catering to this niche have raised $800 million in the past two years, highlighting the immense potential of this growing sector.

The freelancer platform ecosystem can currently be grouped into three big areas:

Job search platforms

Digital platforms are the way to go for freelancers looking for their first job opportunities. In the last few years we have seen them become very niche-oriented:

→ Wripple

Marketing's on-demand talent platform, connecting brands to top-quality freelancers and teams of experts

Total funding: $5M

Founded by: Bonny Davis Block, Shannon Denton, Ray Samuels

Investors: Silicon Road Ventures, Tech Square Ventures, and others

→ Gigs

Connects companies to job seekers looking for full-time or part-time hourly roles in their neighborhood

Total funding: $5.7M

Founded by: Allen Narcisse

Investors: Struck Capital, Wonder Ventures, and others

→ Shakers

Allows companies to work with entire teams of freelancers

Total funding: $8M

Founded by: Adrian de Pedro, Héctor Mata, Jaime Castillo Parages, Nico de Luis

Investors: Harvard Ventures, Athos Capital, and others

Accounting tools for managing finances

Keeping finances in order is one of the main concerns for freelancers. These tools streamline tasks like invoicing, expense tracking, and tax preparation.

→ Indy

Offers advanced AI-powered accounting software for freelancers and professionals.

Total funding: $99M

Founded by: Adrien Plat, Come Fouques, Pablo Larvor, Romain Koenig

Investors: Fast Forward, Kerala Ventures & others

→ WorkMade

Where freelancers can forget their taxes forever.

Total funding: $7.3M

Founded by: Nick Simpson

Investors: VITALIZE Venture Capital, Slack Fund, M13, and others

→ Wingspan

A platform for freelancers to manage income, benefits, and taxes.

Total funding: $17.5M

Founded by: Anthony Mironov, Greg Franczyk

Investors: a16z, Airbnb, and others

Apps tailored for specific industries

This kind of apps provide freelancers with specialized features and functionalities relevant to their field.

→ Instawork

Focuses on the hospitality industry, matching employers with short-term, seasonal, and temp workers. The company raised 60M in a Series D round recently.

Total funding: $148M

Founded by: Sumir Meghani

Investors: TCV, Greylock, Benchmark, Craft Ventures, and others

→ Nomad Health

An online staffing marketplace that connects clinicians to healthcare jobs.

Total funding: $218M

Founded by: Alexander Nazem, Ryan A. Grant, MD, MS, MBA, FAANS

Investors: First Round Capital, RRE Ventures, JP Morgan & others

→ Roo

Online veterinary relief service platform that allows vet professionals to secure freelance work.

Total funding: $16.6M

Founded by: Lisa Hu

Investors: AirAngels, Jackson Square Ventures and Floodgate

Top Platforms for Today's Freelancers

Want to be part of the freelance economy? These are the platforms you can’t miss on your search:


Considered the biggest platform, Upwork is the result of a 2013 merger between two earlier freelancing platforms, Elance and oDesk.

  • Large talent pool in areas such as writing, graphic design, web development, marketing, and more.
  • Convenience, making the whole process of finding, hiring, managing, and paying freelancers easier and secure.
  • Flexibility.
  • Competition: The large number of freelancers on the platform can make it competitive for freelancers to land projects, especially for those new to the platform.
  • Fees: Upwork charges fees on both transactions.
  • Quality can get tricky with so many people applying and little screening tools.


Founded in 2010, it initially focused on services offered for $5 (hence, the name Fiverr). While the minimum price is no longer a requirement, the concept of offering small, specific services remains.

  • Simple and affordable, with a user-friendly interface and the possiblity to find services at a variety of prices.
  • Variety of services, similar to Upwork.
  • Focus on Specific Tasks: Fiverr's core concept of offering specific, well-defined services can be helpful for businesses needing a quick and focused solution.
  • Limited project scope, emphasizing smaller gigs, complex projects requiring ongoing collaboration might be less suitable for the platform.
  • Quality, as with Upwork, the vast number of freelancers can lead to variations in quality.
  • Competition, particularly for low-cost services.


Launched in 2009, Freelancer.com is one of the pioneering online marketplaces for freelance services.

  • Global reach, with a large international user base, opening possibilities for finding talent or projects across the globe.
  • Wide range of project types, from small one-off tasks to larger, more complex projects.
  • Flexible payment options.
  • Competition, especially for freelancers new to the platform or those in saturated fields.
  • Fees: Freelancer.com charges fees on transactions similar to Upwork, impacting freelancer profits and potentially increasing client costs.
  • Compared to Upwork and Fiverr, Freelancer.com's interface might be considered less user-friendly.


Founded in 2010, Toptal aimed to connect businesses with premium freelance talent.  They developed rigorous screening processes to identify highly skilled freelancers across various fields.

  • Curated network of pre-vetted, top-tier freelancers.
  • High-Quality work as a result of their rigorous screening process for freelancers.
  • Toptal handles many administrative tasks, simplifying the process for businesses to hire and manage freelance talent.
  • Selectivity and a pretty demanding application process.
  • Cost, with freelancer asking for higher rates due to their expertise. This might not be suitable for businesses with tight budgets.
  • Toptal might not be the best fit for smaller, one-off projects. Their focus leans towards more complex, critical projects requiring top-tier talent.


Founded in 2007, FlexJobs was created to provide a reliable source of legitimate remote and flexible work opportunities.

  • Wide range of remote and flexible work opportunities across various industries and skillsets.
  • Beyond job listings, FlexJobs provides career coaching, webinars, and other resources to support your remote work job search.
  • Unlike some general job boards, FlexJobs requires a subscription fee for access to their curated job listings and resources.
  • Due to its focus on a popular work style, competition for jobs listed on FlexJobs can be high.

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