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Online freelance platform Upwork priced its initial public offering at $15 per share, but it opened on Wednesday at $23 per share, raising $187 million.

The price has since dropped, but it is still much higher than initial estimates of $10 to $12 per share, or the revised estimate of $12 to $14 per share.

What is Upwork?

Upwork came to be after a merger between two freelance platforms, oDesk and Elance, in 2013. It connects businesses and other individuals with freelancers in a wide variety of fields, from programming and web developing to writing and marketing.

Freelancers create profiles on the site where they can showcase their skills and experience. Clients can browse candidates’ profiles and see ratings and feedback from previous clients before making a hire. Candidates and clients can also share files, send messages and even video chat right on the platform to assist in the interview process.

Clients can pay freelancers hourly or by milestone. Upwork offers a time tracker that measures the activity level of the freelancer during time tracking. It also periodically takes screenshots of the freelancer’s screen so the client can monitor the progress and ensure that the freelancer is actually working.

Overpriced?

Many people see Upwork as a valuable and innovative company. However, even at $12 to $14 per share, Forbes contributor David Trainer considered Upwork to be "slightly overvalued."

In order to justify its price of $12 to $14 per share, Trainer wrote, the company would need to "obtain a dominant share of the freelancer market."

"If competition slows its growth even slightly, the stock has significant downside," Trainer said.

Trainer says that Fiverr, one of Upwork's main competitors, receives better reviews from freelancers. This means that Upwork would have a very difficult time justifying its estimated price, let alone its current price.

In addition, Trainer says that Upwork's expenses are growing faster than its revenue. In the first six months of 2018, revenue grew 28 percent, but its costs grew significantly more. The company is not profitable.

If Upwork is overvalued at $12 or $14 per share, $23 per share is certainly too high.