Companies

Jan 10, 2014

Is Freelancer a $600m company? Behind the online market splash

Freelancer launched with a bang on the stock exchange last year. But can CEO Matt Barrie justify the faith investors have paid him? There's big challenges ahead.

Adam Schwab ā€” Business director and commentator

Adam Schwab

Business director and commentator

Freelancer

Of all the floats in 2013, the most intriguing has been the debut of online marketplace Freelancer. With a float price of only 50 cents (implying a market value of around $218 million), shares soared on listing, hitting $2.60 on its opening day (briefly valuing the business at $1.1 billion and CEO Matt Barrie at more than $500 million). Since then, the share price has fallen back to $1.37 — still a lofty premium over the listing price.

The Freelancer float was not without sceptics. Some considered the 50-cent price expensive and reminiscent of the dot.com boom during hich companies without profit (or even revenue) were valued at billions of dollars, only to collapse in a screaming heap. However, Freelancer did have two things in its favour: first, it claimed to be the market leader in the sector; and second, it was alleged to have received a takeover bid from a mysterious (private) Japanese company that had valued the business at $434 million.

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