CEO: The future is bright for online outsourcing (but not niche sites)

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Australian Matt Barrie, CEO of, has been racking up the frequent flyer miles lately, traveling to pick up a second Webby award for his company and speak at The Next Web Conference in Amsterdam among other appearances. GigaOM caught up with him in London to chat about his company and his views on the future of the sector. In a word, he’s optimistic.

Why? Barrie explained that as hard as it is for perpetually plugged-in Europeans and Americans to imagine, only about 30 percent of the world’s seven billion inhabitants are online, leaving billions of potential customers out there yet to get online. In Asia, for instance, internet penetration is still at a modest 21 percent, leaving some 825 million people yet to get connected.

Getting those folks onto the internet will be great for them (we’ve already seen scattered cases of “million dollar freelancers” who have built seven-figure incomes off platforms like in the developing world) but it will be pretty awesome for Barrie’s business as well, he believes. The flood of newly wired workers will provide a huge and growing customer base of hungry and driven potential freelancers for his site, which already has about 3.5 million users around the world. Barrie’s company charges them and job posters a hefty but variable commission to connect on the site.

Dismissing fears that the trends his site is banking on will mean fewer jobs in the West, Barrie is even optimistic that this explosion in online outsourcing will be good for those of us in developed countries –provided we develop an entrepreneurial mindset and start putting the huge pool of cheap talent across the world to work realizing our ideas and supporting our businesses for, essentially, peanuts. While this inexpensive labor pool may be good news for someone hoping to get a business off the ground on a shoestring, the ability to get stuff done at low cost may be cold comfort for those who are less entrepreneurial by education or character and would like to remain employed. But Barrie seems less than moved by these worries.

Is there anything Barrie isn’t bullish on? In short, online labor platforms that look to compete by serving a specialized sector or targeted geographic location. The likes of Zaarly and ExpertBids “are all going to fail,” according to Barrie because of their inability to scale sufficiently to make enough to be attractive business opportunities. Want to take in a million dollars? Then ten million in business needs to go through the site – the equivalent of something like $100 million in U.S. labor costs if you’re dealing in lower wages overseas – and Barrie just doesn’t see the market being there for niche sites. Those that aim for geographic specificity in the style of TaskRabbit will struggle to reproduce their success in one city in another a bit down the highway, making expanding the business a gigantic money sink, in Barrie’s opinion.

Do you think Barrie’s optimism is well founded?

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