Freelancer.com to test the waters for digital outsourcing
The float of Freelancer.com next month is indicative of the world's evolution from hard copy to hard wired in the digital realm, where it is just as easy to talk to someone on the other side of the world as to somebody in your own house.
Freelancer.com presents a unique business model for an ASX-listed company, in that it has no local peers with which to compare share price performance.
The company is an online marketplace where small businesses and consumers post jobs for freelancers. The prospectus says there are more than 600 job categories ranging from website design, to accounting, to manufacturing.
Freelancer.com's main source of revenue comes from fees associated with posting and accepting jobs, as well other subscription services and it depends heavily on its ability to generate website traffic, which it recognises as one of its biggest risks in its prospectus.
The initial public offering at 50¢ a share, should it be fully subscribed, will give Freelancer.com a market capitalisation of $218 million. However, only 30 million shares will be sold under the general offer and a further 5.1 million under the employee offer out of a possible 436 million shares.
The float will raise about $17.55 million through the sale of a 6.9 per cent general stake and a 1.2 per cent employee stake.
Chief executive and chairman Matt Barrie will retain a 46 per cent stake in Freelancer.com.au with more than 200 million shares.
Last year Freelancer.com reported net revenue of $10.6 million with an after-profit tax of $728,000. This year the company forecasts revenue to surge 73 per cent to $18.3 million, with a profit of $471,000. Forecast earnings are 11¢ a share.
For prospective investors, the tough pill to swallow may be the forecast price-to-earnings multiple of 463 times.
Freelancer.com is expected to list on the ASX on November 15.