No nine figures for now, but no worries, says Freelancer.com founder Matt Barrie.Photo: Louie Douvis
The founder of outsourced jobs portal Freelancer.com, Matt Barrie, says there are enough tech-savvy investors in Australia who understand why his soon-to-list business will carry a $218 million market capitalisation off forecast calendar 2013 earnings of just $471,000.
“LinkedIn is double [Freelancer’s price-to-earnings multiple], a market cap of $US26 billion off about 900 million current earnings, and locally [accounting software provider] Xero doesn’t even have positive earnings and it’s trading at a huge valuation,” Barrie says, following the release of the prospectus for next month’s float.
“We’re a high-growth technology company and there’s just different metrics to how you’d value a bank or something. What matters for us is top line revenue growth. Websites are pretty cheap to run in terms of overheads, so we’re working around the clock to grow the company as fast as we can, and make that a big number.”
Listing on the ASX will attract scrutiny and create big regulatory requirements, all to raise just $15 million or 6.7 per cent of Freelancer’s equity, however Barrie said going public gave his company the most flexibility in a space where consolidation was on the cards.
“Services are lagging products by 10 years in terms of the consolidation trend,” he says.
Freelancer.com has attracted criticism for maintaining a three-person board in to its float, with no independent directors, however Barrie said “staying focused and tight” was the priority for now.
“Over time as the major shareholders sell down – and that won’t be any time soon – we’ll go in the independent direction,” he says.
The market cap of Freelancer.com will be nearly half the takeover offer Barrie reportedly just turned down from Japan’s RecruitCo, however he’s relaxed about this.
“You’d expect a premium for a change-of-control transaction,” he says.
That premium would have netted Barrie a nine-figure sum, but the entrepreneur insists “it was just too early to sell . . . someone in the [outsourced jobs] sector will get to ebay or Amazon size. Ebay Australia has nine million users, we’ve got nine million globally so it shows you how much our sector is in its infancy.”