According to sources, Microsoft is in talks with Upwork to acquire the company in 2019. The companies announced their official partnership last month to enable enterprises to build freelance teams at scale.
Upwork has noted in recent history that enterprises are its highest value client for two reasons:
- Enterprise clients historically spend the most money on Upwork. For instance Microsoft hired over 2,000 jobs on Upwork last year.
- Enterprises are least likely to disintermediate Upwork. Smaller companies that are highly budget conscious are more prone to attempt to work directly with the freelancer in order to get a discount on the freelancer work. Data has shown that these smaller companies eventually go back to Upwork’s platform to engage freelancers due to the perils of working with freelancers direct, especially freelancers that are internationally based.
Since the Microsoft/Upwork partnership was announced and the news of the potential acquisition, there’s been a flurry of news reports that hail the acquisition as “a clear indication freelancing has become part of the entire workforce” and a “a natural acquisition for Microsoft.“
