The freelance consulting platform Malt announces a fundraising of 80 million euros led by Goldman Sachs Growth Equity, which is entering, and Eurazeo, already present through its venture activity and which today invests in growth equity. They are accompanied by historical investors Isai and Serena. So far, Malt has raised around 32 million euros since its inception in 2013.
In the context of Covid-19, companies have realized that they cannot deprive themselves of freelance talents, alongside other players in intellectual service such as ENS, to accelerate their transformation. Opposite, employees realized that this method of collaboration corresponded more to their aspirations, further increasing the contingent of freelance talents. A boon for platforms like Malt, which specializes in bringing the two together.
Find the full interview with Vincent Huguet, co-founder of Malt
1 million freelancers in France
«In France, there are now almost a million freelancers. If we really take only those in Tech, we are around 600,000-700,000. This figure is 6 million in Europe. We have just completed a study with the consulting firm Roland Berger. We estimate the market at 350 billion euros in Europe and 650 billion in the United States», Illustrates Vincent Huguet, co-founder and CEO of Malt.
And to fully understand the dynamics of this market, you have to keep in mind the difference between freelancers in the gig economy and those in the talent economy.
«We could very simply speak of the difference between blue collar and white collar workers. Depending on this, the platform models are differentVincent Huguet explains. «There are platform models where the price is determined. The worker does not choose what will be the service, the customer and the price. And then there is the model like ours which concerns workers in the talent economy. They are rather ‘white collar’ people who will work with companies. These are B to B services of very ‘high level’ intellectual services. These are people who charge up to 400, 500, up to 1000 euros or more per day and who will determine the price, and above all have the choice of missions.».
A business volume of 200 million euros
Via its platform, Malt has designed a technology that matches the profile of a freelance consultant with the needs of a business. The startup also offers solutions to manage the relationship, from issuing the brief to paying for the assignment.
The company claims 250,000 freelancers on its platform and more than 30,000 clients, including 36 CAC 40 companies. It has 200 employees with a presence in France in Paris and Lyon, in Germany in Munich, and in Spain in Madrid.
Regarding its business model, on the freelance side, Malt charges a commission of between 10% and 5%. The more the freelancer works with a client, the more this commission decreases. For companies, commissions are between 15% and 5%. Malt does not communicate on its turnover but only on its turnover, which should reach 200 million euros this year. As for its growth rate, it “almost every year», Declares Vincent Huguet.
Regarding profitability, “we will be profitable in France at the end of the year or at the beginning of next year», Explains the co-founder of Malt. “VS‘is a slider that we set ourselves. We choose the moment when we want to be profitable, that is to say that according to the speed of growth that we are going to have in each of the markets and if we invest much more, beyond our product, on our sales teams and our marketing. But we’re not on a model that needs gigantic volume to start making some money. We have significant margins on every action we take».
Differentiate from auction platforms
If the freelance market is vast, so is the number of players who have embarked on it. We can cite platforms like Upwork, Freelancer.com or Codeur. “Indeed, there are a lot of them in all countries, including very large international platforms. Some are now on the stock market, on the Nasdaq”Illustrates Vincent Huguet.
But the latter is particularly keen to point out the difference in his model vis-à-vis platforms that work with auction systems. “These are reverse auction models where freelancers are put in competition. They will offer their price on an offer, and we will find the lowest price. These models quickly go very offshore with most of the freelancers based in South East Asia to have very low costs per hour and do small tasks. We have turned things around. We started from the community and it is the client who comes to find the freelancers, to pitch their project, and that changes everything. We are ultimately no longer in competition with offline players».
Tech development, international and 1 billion business volume in 2024
With this fundraising of 80 million euros, Malt wishes to invest more in its technology and accelerate its international deployment. The first countries considered are the Netherlands, Belgium, Italy and the United Kingdom. In the longer term, the United States could also be a development ground.
To continue its expansion, Malt does not rule out the possibility of carrying out external growth operations thanks to this funding round either.
In terms of figures, for almost two years, the company has set itself a target of one billion euros in business volume by 2024.