By Jeff Benson
If you’ve ever been a freelancer, you know that using a job network—one that matches you with companies looking to hire for jobs as small as $5 and as large as $50,000—sucks.
There are thousands of freelancers there, each one undercutting the other, and many people feel like they have to set bargain-basement rates—or already have client reviews on the network—just to get noticed.
Braintrust, a nonprofit “decentralized talent network” that launched its token on the Ethereum blockchain this week, sets out to solve that poor user experience because co-founder Adam Jackson says he lived it.
“I was like, hey man, I live in California so I need to make at least $25 an hour here, but the guys in Bangalore will do it for $5,” he told Decrypt. “And then it gets very spammy too. It sucks for clients, too, because there’s all these users submitting all these bids. You don’t know what’s real.”
The answer was cryptocurrency. Though plenty of projects have been knocked for trying to jam in blockchain where it doesn’t belong, Jackson and his team thinks its application here makes sense.
The way it works is this: If you’re a freelancer, you must apply to be on the network, unlike most sites which allow anyone on. Braintrust wants the participants to be vetted because that saves its clients, which include Goldman Sachs, Nike, and Nestle, from being inundated with low-quality applications. “Enterprises of this size aren’t interested in dealing with shitty talent, and they also are willing to pay competitive rates,” said Director of Communications Sam Katzen.
But Braintrust isn’t the one doing the vetting. Instead, it distributes its BTRST token to those who do so. Moreover, community members who review applications and refer new applicants have an incentive to select quality people, as they receive token rewards with every finalized invoice those members receive.
This solves for a couple of problems in one. Freelancers on Upwork can pay as much as 20% of their invoice back to the network (that slides down to 5% for jobs worth over $10,000), meaning they have to inflate their prices to get paid their actual rate. On top of that, businesses pay a 3% processing fee; they might also pay a flat monthly rate and a 10% fee to have their own account manager.
This is more than a mainnet launch. This is a movement!$BTRST has launched, and with it we’re giving ownership and control back to the workers. It’s the fair and equitable future of work, and it’s time we own it.#BTRST #ownithttps://t.co/yfn9SzS1th
— Braintrust (@usebraintrust) September 1, 2021
Those costs can drive workers and companies off the platform as clients look to forge a rate without intermediaries.
“Our users are also our owners,” said Jackson, “and so there’s no incentive to move off the platform. In fact, there’s an incentive to stay on the platform because every time you get paid an invoice we give you tokens. It’s a cool virtuous cycle.”
But what do those tokens actually get you? They’re not used to pay for services. (Said Jackson, “We don’t think a native token makes sense to pay people.”) Instead, as Jackson puts it, it’s a “reward incentive mechanism plus governance system.”
The token, forked from DeFi protocol Compound’s COMP token, will be used to make decisions about the site as it becomes increasingly decentralized, for instance, whether to expand to new markets or change the fee structure. They can also be used to settle disputes that arise between clients and freelancers. (A platform like Upwork, says Jackson, “always sides with the client.”)
Big investors have already gotten in, showering Braintrust with $18 million in a fall funding round last year. Franklin Bi, Pantera Capital’s Director of Portfolio Development, told Decrypt, “Just like Audius is making a run at Spotify and empowering creators, Braintrust is taking down Upwork, Fiverr, and Accenture by empowering independent knowledge workers and clawing back massive take rates.”
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The network says it’s growing, doing decent business even as the token ran on Ethereum’s Ropsten test network instead of on mainnet. According to numbers shared with Decrypt, the network is on track to do $31 million in invoice volume this year, and it has at least tripled in size in three categories—clients, workers, and job postings—since its June 2020 launch. Moreover, the average pay is $92 an hour, with the average project worth $57,000.
That’s a whole lot better than advertising for $25 and praying you don’t get beat by the guy doing it for $5.