I did one small project, about a week's worth of time, and was paid $3k.
If you're a freelancer/consultant who wants equity, ask for it. Some companies are willing to give non-qualified options (the only choice, really) after you've built up a relationship and if you're making a significant contribution to the company.
Also, I've read the page top-to-bottom and still not fully clear on what's happening here. Highly suggest running this by non-insiders and rephrasing the messaging until it's easier to understand.
What's needed is a collaborative investment management platform for freelancers. For example. twenty freelancers could make an agreement pursuant to which they each (a) reasonably demand equity alongside pay for their work, (b) contribute all equity they earn in exchange for services to a fund co-controlled by the others and (c) share in the fund either equally or proportionally to their contributions/the performance of their contributions (e.g. contributor gets 20% and the remaining 19 split the 80%). This is a healthier financial structure than having bigger, but more concentrated, stakes ceteris paribus.
If you're a freelancer asking for equity, you'll give up some of your payment. Gigster is not saying AFAIK: we cut some of your pay in exchange for some equity.
Again, AFAIK, Gigster is clearly saying: The more you make customers happy and engaged in your gigs, the more you will earn equity from companies of the Gigster Fund.
(I speak as a Gigster which was also using Upwork before, so I'm biased but I believe in Gigster and I am happy to tell people about it.)
It looks like, as a Gigster developer, you would get 1%/total active Gigster developers. If there were 500 Gigster developers over that 1 to 5 year period, you'd get 1%/500 = 0.002% of a liquidity event depending on Gigster's weighting mechanism. If Gigster's equity stake was 20% in a company that exited for $100 million, you'd receive maybe $40,000 depending on how Gigster determines your weighted percentage.
It's not really even the same league as a 401k or pension, contrary to what the page says.
Calling it equity is a bit confusing. On the page it states at the top:
"Gigster Fund provides our freelancers with access to equity from Gigster and select companies in our client portfolio."
At the bottom it states with regards to owning equity:
"No. Direct equity ownership or indirect ownership through a limited partnership has complex tax & legal implications, and the SEC limits the number of shareholders a corporation may have which would make direct ownership impossible after a certain number of freelancers".
And
"No. Direct equity ownership or indirect ownership through a limited partnership has complex tax and legal implications. In the United States, for example, Gigsters would be required by law to be accredited investors."
That would make it 0.00002
> Gigster's equity stake was 20% in a company that exited for $100 million, you'd receive maybe $40,000
So $400 not 40K. Even a 1 billion exit would only net you 4k, assuming your interpretation is correct.
Gigster's stake is 20M. They share 1% with freelancers, which is 200K. You get 1/500th of this = $400. Amazingly generous!
> This allows our freelancers to receive tangible rewards for their hard work building incredible software, and helps them prepare for the future.
Wouldn't simplify paying a freelancer be a tangible reward? And if you're not paying them then they're not really freelancers, they're either interns or suckers (or both).
> Will every Gigster Fund company yield a successful return? No. Although some startup companies yield extraordinary financial returns, many fail.
Ha! Great way to spin "The majority of this will be worthless ... but you buy Powerball tickets too right?"
I did some work for gigster a few months ago just to try it out. It was a breath of fresh air compared to upwork/elance/etc. Average pay for engineers was around $100/hr.
Maybe not all or nothing but this would end up just like a startup offering equity as compensation. They'd argue that they can pay you less (vs. straight cash for services) because you've got this equity piece as well.
Can't see freelancers retiring on a miniscule % of a muslim dating app.
You'd think with all the quality devs being purported that there'd have to be something of quality in there although the portfolio so far is YAWN!
But... this is the same company that was giving out work quotes in less than 10 minutes. I expect gigsters existence is subsidized by VC investment and it will be unable to succeed long term. I'm not expecting good things for anyone involved.
"Talent pedigree - 1%", "Hire All- Stars", "Marquee Investors"
That aside, I'm not really interested in more hand-holding-as-a-service, this time aimed at us consulting developers.
