Airtasker looks at American expansion

Airtasker looks at American expansion

Summary: Airtasker is already connecting a community of 130,000 members across Australia, and now it hopes to do the same in New York.

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TOPICS: Start-Ups, Australia
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Australian startup, Airtasker, is exploring international expansion opportunities with the first stop being New York. 

Airtasker is an online outsourcing platform created to connect people to others who are willing to be paid to carry out chores — from standing in a six hour queue for the Games of Thrones exhibition, to delivering Gelato Messina cakes, to hungry office workers. A Sydney surgeon has even used Airtasker to fly someone to the US to pick up an engagement ring.

It currently has 130,000 community members across Australia and an annual task rate run of AU$4 million, and has experienced triple growth so far in 2014.

Airtasker CEO Tim Fung told ZDNet that expanding overseas, particularly in New York, has been in the works for a "long time" but executives have only travelled to the Big Apple in the past month.

"The reason why we thought that market was so strong was because it's got great urban density, and it all comes down to the liquidity, broken down by location."

"It's broken down in terms of skill-set. It's much more related to location [compared to sites like Freelancer.com], in Sydney, well, we have to find more workers, and that's what makes New York an attractive market."

Initial research has identified some similarities and differences between operations in Australia and the US, according to Fung, noting that some "significant product changes" will need to be made.

"The similarities are the payment methods, we both use PayPal, Google, speak the same language, and have similar properties.

"The differences are in the culture, like tipping, we don't think about that in Australia. The second thing is in terms of the types of verticles, like cleaning gardening and handyman work, and in New York, gardening is not really on the agenda."

Fung admitted, however, that entering a new market, especially the US — given that it's a "super competitive place" — will not be an easy task for the company, and that it will require a lot of work.

"You can't mess around in the US. I would say, there's probably far more competition in terms of indirect competitors — compared to direct competitors," he said.

"It's about convincing people who don't use any of these platforms to use some of our platforms. When we mention the US, one of the key things is the resource restrictions you have; our team is very lean. We think the concept of purchasing services through an online marketplace will be the norm in a few years.

"We've made inroads, but there's still a long way to go. We're just keeping our head down, and getting on with it."

Meanwhile, the company continues to expand itself locally as well, announcing the acquisition of Melbourne-based odd jobs outsourcing business Occasional Butler, which was founded in 2012 by Erz and Jodie Imam, for an undisclosed amount.

"After meeting with Airtasker we realised that we shared a parallel vision of how a services marketplace should grow and we quickly found we could create an even better customer experience by forming one big marketplace across Australia," Jodie and Erz Imam said in a statement

"We're really excited to join forces with the Airtasker team and will continue to be involved in marketplace development as Community Advisors."

Fung said the Occasional Butler team will initially join the Airtasker team to assist with the integration of products and customers into the Airtasker ecosystem, and then "going forward from there, we'll see how it goes".

The acquisition follows a previous acquisition by Airtasker of rival TaskBox in February 2013.

When asked whether acquisitions were part of Airtasker's expansion strategy, Fung was quick to compare the company to how Australian start-up Freelancer has been operating.

"If you look at their vision, one platform with two sets of users is better than two separate platforms. The reason for that is there's an exponential value creation in the number of network creations that is developed, so when you have a bigger marketplace that has twice as many users, there's a greater number of interconnections," he said.

"This means more connection and opportunities with skills, locations, and availabilities of people, and that's where the power of the network comes in."

"We believe that our platform, our technology, and the way we connect two people together is going to be the 'smart differentiator' between ourselves and where we fit into the marketplace," he said.

Late last year Airtasker closed a AU$2 million funding round with the Kahlbetzer family-backed BridgeLane Capital, Sydney-based Exto Partners, and a range of private equity investors. It followed BridgeLane's initial funding injection into the company worth AU$1.5 million.

Topics: Start-Ups, Australia

About

Since completing a degree in journalism, Aimee has had her fair share of covering various topics, including business, retail, manufacturing, and travel. She continues to expand her repertoire as a tech journalist with ZDNet.

About

Leon covers enterprise technology and start-ups from ZDNet's Sydney newsroom.

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