- BRW Lists
Published 15 October 2013 11:50, Updated 22 October 2013 11:01
Matt Barrie will retain plenty of skin in the game when Freelancer lists. Photo: Sasha Woolley
Online work marketplace Freelancer.com has released its prospectus for its proposed float on the Australian Securities Exchange, giving the public the first real insight into the business.
Here are the five most interesting things in the prospectus.
This is the first time Freelancer has disclosed its revenue: $8.46 million for the half year ended June 30, 2013 and a forecast of $18.3 million for the full year.
It is growing fast, considering revenue was $10.63 million for the entire 2012 calendar year.
However, it is a lot less than the $1.2 billion figure that has regularly been mentioned in connection with company in recent years. That figure represented the value of projects listed on the site. While the company never claimed it represented revenue it did sound impressive.
Profit after tax is expected to be $471,000 for the full-year 2013 and earnings before interest, taxation, depreciation and amortisation is forecast at $736,000.
The company is offering shares at 50¢ each, implying a market capitalisation of $218 million.
It is interesting that this values the company at a lot less than what Japanese recruitment site Recruitco was prepared to pay for it in a trade acquisition.
In September, Freelancer co-owner and chief executive Matt Barrierejected a $US400 million ($421 million) offer from Recruitco to buy the business outright.
That suggests Barrie is taking a long-term bet on the company’s growth prospects.
He has plenty of skin in the game. At the date of the prospectus he retains well over 200 million shares, representing nearly 46 per cent of the total.
The number of shares being offered to the public are 30 million, while an additional 5.1 million are offered to employees.
The board is small and there are no independent directors.
The board members include two executive directors, Barrie and chief technology officer Darren Williams, and one non-executive director Simon Clausen.
Clausen, who is already a major investor in Freelancer, holds nearly 168 million shares at the time of the prospectus, 38.5 per cent of the total.
Between them, the three directors own more than 87 per cent of the business. This is listed as a risk in the prospectus.
Freelancer has done a better job than Twitter on gender balance. There are no women on the board, but there are two women in management roles deemed senior enough to name in the prospectus. Twitter has no women on a board of seven and only one woman in senior management.
The Freelancer women are legal director Isla Hale and regional director North America and Oceania, Nikki Parker. There are nine men in management roles.
The prospectus outlines a variety of risk factors for the company, but the first in the list is anything that would diminish its ability to attract web traffic.
This includes ineffective marketing, reputational damage and changes to the Google algorithm that could affect search engine traffic.
Like many consumer-facing businesses, reputation is important and the business is susceptible to public pressure.