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Upwork, the most popular freelance marketplace, will be offering 12.2 million shares in its initial public offering.

What is Upwork?

Upwork is an online marketplace where individuals and large companies hire freelance employees on a contract basis. It isn’t simply a job board. All payments are processed via Upwork. It charges a percentage of each payment as the fee for using the site.

As the Upwork prospectus states, “Our platform provides clients with fast, secure, and efficient access to high-quality talent with over 5,000 skills across over 70 categories.” These skills include “content marketing, customer service, data science and analytics, graphic design, mobile development, sales, and web development.”

Also, the company keeps its platform fair for everyone by offering facilitating two types of guaranteed payment contracts. The first type of contract allows freelancers to track their hourly activity. The second is a fixed price contract that work by collecting payment from clients and holding it in Escrow until the freelancer completes a certain amount of work. In case of a dispute, Upwork works with both parties to resolve the issue.

Upwork’s Performance

In 2016, Upwork processed $1.15 billion of payments. It increased that number to $1.37 billion in 2017. That change reflects a 20 percent growth rate.

Revenue for the site was $164.4 million in 2016. It grew to $202.6 million in 2017. The company processed 20 percent more payments, but earned 23 percent more in revenue.

In 2016, the company showed a net loss of $16.2 million. But in 2017, its loss was only $4.1 million. The reason for the losses? According to Upwork, “We have made significant investments to grow our business, including in sales and marketing, research and development, operations, and personnel.”

And last fiscal year, Upwork processed $1.56 billion worth of payments. It served 375,000 freelancers and 475,000 clients. Its reach covered 180 countries.

Upwork states, “We believe that a key driver of our growth is our track record of creating trust and enabling freelancers and clients to successfully connect at scale on our platform. As the largest online global marketplace for highly-skilled freelancers as measured by GSV, we benefit from network effects that drive growth in both the number of clients posting jobs and the number of highly-skilled freelancers seeking work.”

Outlook for the Company

McKinsey Global Institute estimates that by 2025, the freelance economy could generate $2.7 trillion. That figure translates to 2 percent of the U.S. economy.