woman freelancer working on laptop
Launched at the dawn of the gig economy in 2009, Thumbtack brings together a broad base of professionals who are vetted, ranked and filtered through the platform’s unified system. — Getty Images/lechatnoir

You know how it is when you find that perfect someone?

Recently, at a dinner, one woman waxed lyrical of a certain fellow who made her heart happy just by walking in her front door. “I love it when he comes over,” she sighed.

The man in question wasn’t her significant other. Rather, he was a handyman who handled a number of mounting projects for her (five, at last count), but she indicated her loyalty by claiming that anytime she’s in need of such skill, she’d be looking for him again.

She found him through a listing on Thumbtack, a two-sided marketplace for local professionals (dubbed “pros” in Thumbtack’s parlance) with expertise in a variety of industries from carpenters and pet sitters to wedding planners and attorneys, and the people looking to hire them.

If you’ve not heard of Thumbtack, you probably will very soon, as the gig economy continues to grow. Although you can Google or search Yelp for professional services of all stripes, or comb specialized marketplaces such as such as WeddingWire (for bridal services) or HomeAdvisor (for home improvement), Thumbtack is somewhat unique in that it brings together a broad base of professionals who are vetted, ranked and filtered through the platform’s unified system that pulls specific criteria to personalize searches. In other words, if you are looking for someone to rewire the electricity in your bedroom and you search on Google, you might get hundreds of results for electricians who don’t do residential work and may not even serve your area. Not so on Thumbtack. And if you need a pet sitter while you’re getting that rewiring done, you can find one on the same platform.

The sheer diversity of professional services coexisting with the ability to filter for exactly what you need has been a powerful catalyst for growth. Thumbtack just passed a major milestone of hosting over 50 million projects and counts hundreds of thousands of pros listing their services for hire.

To handle this, the online services marketplace ranks have swelled from just six people at launch in 2009 to 800 full-time employees. According to Thumbtack, annualized revenue has grown at a rate of 125% year-over-year.

That’s led to Thumbtack receiving $400 million in outside investment, pushing its valuation to $1.7 billion, well into unicorn territory. Thumbtack co-founder and CEO Marco Zappacosta declined to confirm that he’s looking to take the company public, saying only that going public is “one milestone,” though startups valued over $1 billion generally do have an IPO (or get acquired) before they reach 10 years of age.

Thumbtack just passed its 10th birthday — it launched at the dawn of the gig economy back in 2009 — and has had its share of growing pains, according to Zappacosta. That goes for everything from landing those investments to shifting gears on the business model itself.

“Thumbtack helps you hire local pros for whatever you need,” he said. Either through the web or on mobile, anyone can get on the platform and search for what they need done, filtering for very specific criteria. Then, the consumer sees a list of qualified pros available that serve within their zip code. The listings are complete with ratings from former clients, and also show how many times each pro has been hired through Thumbtack. The listings also include estimated starting cost for a service, be it for a hairdresser, photographer or therapist. If contacted, the pros then can submit bids for the project. As Zappacosta pointed out, “More data [equals] confident hiring decisions.”

 screenshots of thumbtack platform
On Thumbtack's platform, search results display how many pros are nearby, estimated costs of the service, the amount of times a pro has been hired, as well as user reviews. — Thumbtack

Growing pains and a change to the business model

It wasn’t easy to get to this place, Zappacosta said. Early on, everything was manual. A customer had to fill out a form and the pros would write back with price quotes. Although it was great to have that personal touch, Zappacosta said that it could take a long time to volley back and forth.

“We all expect instant gratification,” he said, and the fact that hires couldn’t be made instantly nagged him. So Zappacosta and his developers started making changes in 2017.

The motivation was to take friction out of the experienced to reduce the time the pros had to read and respond to each query. But it wasn’t enough just to list names and numbers like on Yelp or Google, he said. In the quest to deliver instant results but retain personalization, Zappacosta explained that Thumbtack started collecting data from pros to “pre-answer all the questions you would have for them.” In turn, he said, Thumbtack asked the pros “to trust us more” by giving the company all their targeting preferences, such as what types of projects they’d like to work on. For example, a carpenter could specify that they specialize in kitchen cabinetry and aren’t willing to work outside of certain zip codes.

This was a major undertaking that meant going through job, pricing, availability and location preferences for hundreds of thousands of pros, in all 50 states.

And it came at a cost. Thumbtack had to rejigger its entire website to accommodate a new system of personalization. But the way they made money changed, too.

Thumbtack itself is free (it is free to sign up and set up a profile) and there are no subscription or commission fees. In the beginning, pros would pay when they submitted a quote. Now Thumbtack was asking them to pay for leads to potential customers. The idea was that the advanced level of personalization would translate to Thumbtack’s ability to give the pro a batch of potential customers that were much more likely to hire them. But there was no guarantee that they would get hired. Some pros decided it wasn’t worth it and dropped off the platform.

“Certainly there were critics,” Zappacosta confessed, particularly because the pros themselves weren’t asking for the change. And some of the leads didn’t generate business. But he insists that Thumbtack’s goal is to keep delivering the best-matched potential clients that the pros can convert to paying customers.

Danielle Penn is one of the pros who experienced the growing pains but stuck with it. She signed on to Thumbtack in 2014 and says her business took off four months later. Penn’s photography business is based out of Southern California and she has also used a competing, albeit more niche platform, Wedding Wire.

“There were some kinks at first within the platform, just like any business,” she said, “however we grew together to both be extremely successful.” Penn declined to provide revenue numbers but said she gets 75% of her customers from Thumbtack and is booked through 2021.

We believe the future of work is going to be these local services and non-routine tasks.

Marco Zappacosta, co-founder and CEO, Thumbtack


After its launch, Thumbtack realized it was experiencing growing pains and made a change to its business model. Read on for more ways successful startups overcame hurdles.

 marco zappacosta headshot
Marco Zappacosta, co-founder and CEO of Thumbtack. — Thumbtack

Market outlook: Opportunities and challenges

Scott Galit, CEO of Payoneer, a payment services provider for freelancers that has no affiliation with Thumbtack believes that, despite the hiccup, the marketplace and others like it are gaining traction. “Specifically, with regard to job skills, and globally speaking, we’ve seen success from our own partners, like Fiverr and Upwork, which are both now public companies,” he told CO—. “As long as the marketplaces continue to deliver real value to both buyers and gig workers, there are tremendous needs and opportunities to address,” he added.

If there are challenges to Thumbtack’s growth, it’s always going to come down to simple supply and demand,” said Joelle Kaufman, the chief revenue officer of Dynamic Signal, an employee communication and engagement platform based in Silicon Valley.

“It’s something that impacts every marketplace,” she said. “What happens if you have too many contractors and not enough opportunities? Contractors won’t see it as a valuable channel and the price-per-lead won’t be worthwhile,” Kaufman explained. “Platforms like Thumbtack certainly can help contractors be successful by coaching them on how to price their services and do things like cultivate reviews,” she said, “But at the end of the day, the ultimate responsibility will fall on the contractors.”

That said, Galit noted that the growth in the ranks of gig workers — by some estimatesthey’re close to 60 million strong — is going to continue to benefit local platforms like Thumbtack, and their more global and enterprise-focused cousins like Upwork and Fiverr.

As for the future of work and the threat of automation taking jobs away from these pros, Zappacosta remained sanguine. “It’s not about skilled versus unskilled being affected by automation, it’s about routine.” He explained that a radiologist who does rote taking of X-rays (not someone you’d look for on Thumbtack) is far more likely to be replaced by automation than a plumber (someone you would hire through Thumbtack).

“We believe the future of work is going to be these local services and non-routine tasks,” he said. “We have dreams of things beyond that,” he continued. “We are still tiny, but driving a ton more growth.”

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