Since my recent post about Pipe, Peter from FinVC recommended that I check out what Braintrust is up to. I dug in and was not disappointed. Let's go!
Braintrust is a two-sided talent marketplace with a blockchain token, $BTRUST.
🥖 The Marketplace
Similar to other talent marketplaces, Braintrust aggregates companies looking to hire freelance talent (demand side) and high-quality tech talent (supply side). The playbook for this part of the business is well-known: continue to grow both sides until the marketplace becomes self-sustaining via network effects and other moats. Sound easy? It's not.
Marketplace businesses are tricky to get off the ground. They require doing things that don't scale in order to grab market share. It's grueling work akin to building two businesses at once. Moreover, Braintrust is up against some big competition with established brands including Toptal, Fiverr, and Upwork.
To assure continued success, Braintrust must execute the following at a minimum:
- processing payments
- settling disputes
- building sticky tools & features (e.g. discovery, scheduling, time-tracking, reputation systems)
- vetting talent
- and everything else customers (hiring organizations) offload to Braintrust instead of handling internally.
So we know it's difficult, but how might Braintrust dominate the talent marketplace of the future and beat the competition?
🌪 The Twist
Braintrust is a non-profit that prides itself on transparency, user-ownership, and not extracting rents.
- Braintrust doesn't take a cut from its talent base (👈 this is hugely important to freelancers).
- Hiring companies gain transparency: jobs are marked up at a flat 10% rate (so Braintrust can cover its bills).
- Talent and companies own the network via the $BTRUST token, a digital asset issued by Braintrust that incentivizes referrals and enables token holders to play an active role in the network by voting and vetting peers.
Typically, most marketplaces succeed by first aggregating supply. Braintrust believes that its non-profit model and token are enough to align incentives and diminish the resources needed to hit self-sustaining growth.
Braintrust’s accomplishments include:
- Capturing $2M+ revenue in the first 11 months of private beta since Jan 2020.
- Gaining 52 active customers, mostly large enterprises
- Growing 59% MoM organically with no marketing spend
- Onboarding 1,000 approved freelancers with 55k more on wait list, growing through word of mouth
🤷♂️ User-owned what?
The user-owned economy is a model whereby customers benefit by sharing in the success of the companies whose products they consume. For example:
AirCnc is a marketplace where hosts can rent their homes to travelers. AirCnc bets that by creating a loyalty program, they can incentivize their host community to only list their homes on AirCnc. In return, hosts get special recognition on the site, access to benefits and perks such as exclusive host-only events, and dividends every quarter.
The thesis is sound, but how long until it becomes mainstream?
First, Bitcoin needs to solidify its place as an excellent store of value (hitting gold's market cap). Once consumers store large amounts of wealth in a decentralized currency, blockchain based digital assets like $BTRUST will be easier to understand and utilize. Shifting demographics and the remote work wave are both trends that Braintrust will ride.
Until then, Braintrust should mitigate the complexity of digital assets and lead with the value: matching freelancers to gigs without price gouging, and connecting companies with the best, distributed talent. Gradually, Braintrust should test new features for the $BTRUST token and course-correct when necessary. Braintrust should include the "Beta" or "Preview" labels on all $BTRUST technology and be transparent about utilizing experimental tech so they’re in a position to exceed expectations.
What's exciting about Braintrust?
Braintrust is taking a radically different approach to building the talent network of the future. Other companies are either beholden to shareholders (Fiverr) or will be once they go public. If Braintrust stays true to its mission, it can build a wonderful, future-proof network to show the world there are alternatives to riding the VC route to IPO.
- remote work
- software eating the world
- distributed talent, demand for specific needs
- user-owned economy thesis
- sovereign individual thesis
- Metcalfe's law
- established players with market share
- digital assets can be confusing
- experimental tech
- unclear regulation
- Braintrust is building a great business and then rewarding users with tokens. This is absolutely the right way to do it as opposed to many ICOs in 2017 who sold a token and then tried to create a business. As Braintrust is a trailblazer in the space, I'll be keeping an eye on its endeavor to integrate a digital asset thoughtfully. Braintrust will benefit from having a dedicated team to work through gamification, growth, tech, and regulation as it creates not only a marketplace but a community.
- With a small team, word of mouth marketing, and excellent customer experience, Braintrust has the potential to become one of the best talent marketplaces globally.
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