The Elance Interview – The Elance you probably didn’t know

I recently chatted with Fabio Rosati of Elance. Fabio’s been at the helm @ Elance since 2001 and the company has changed a lot during his tenure.

By way of full disclosure, my one-time business partner and fellow blogger, Vinnie Mirchandani, and I once launched a dot-com that brokered large IT services deals. Elance handled the freelancer part of the services world and we did big IT projects.

I assumed Elance had sort of stayed in a time warp. As Fabio and I conversed, I realized that they have changed considerably.

First, Elance had decided to move into the project staffing space but sold off that business in 2006. Since then, Elance has been on a major re-invention effort - a re-invention that has been focused on creating a very complete site for online work.

At first glance, I thought “Wait, Elance was originally a place where people and businesses could locate and acquire freelancers. Is this merely a get back to basics effort?” This was the site that championed the ‘free-agent nation’. Well, it turns out that a basic marketplace for freelance service providers (i.e., the gist of what the original Elance was) was not what the market needed.

The market instead wanted something better. It wanted a marketplace that also had a virtual work space where the contractor and free-agent could collaborate. But more than collaborate, companies also wanted the time tracking and quality assurances that were missing (and still are in many cases) in many services marketplaces.

Elance has made the following key focus areas:

- quality of outcome - predictable results - assurance - delivery of the best possible talent

This is quite different than how many used the old Elance. Back then, users were interested in achieving a labor arbitrage play, pure and simple. Unfortunately, without the infrastructure to ensure that both parties had clear expectations of each other, both parties understand the quality and time requirements of the work, etc., many buyers and sellers left their Elance experience less than totally pleased.

Beyond the collaboration and project/quality management capabilities that Elance has added, the company has created an Elance University where potential freelancers must pass an admissions test for certain technical skills. These workers must also undergo a telephone verification and voice match before being matched on projects. This prevents unqualified individuals from accepting assignments and it stops ‘ringers’ from posing as qualified freelancers.

The quality of the freelance network is key to Elance’s new approach to the market.

Elance is also alerting the users of its services as to the status projects. It proactively alerts users of time and budget variances.

To really put the changes in perspective, compare the nature and quality of services being brokered in Craigslist versus the new Elance. Elance is no longer an auction site for services. It grew up.