Perhaps ironically for someone whose business relies on outsourcing tasks Matt Barrie has a very do-it-yourself approach to entrepreneurship.
Barrie is CEO of Freelancer.com, the online outsourcing service that lets users post jobs in more than 400 different categories, mostly in the design and IT space.
An army of nearly three million workers bid to be given the task in return for an agreed fee and so far more than 1.1 million jobs have been completed, earning freelancers more than $100 million.
For his trouble Barrie takes a $3 or 3% cut for employers and $5 or 10% for employees. He says the biggest beneficiaries are Western businesses that have slashed costs by outsourcing, say, design work to India for a fraction of the cost of a local contractor.
A new funding game
But when it comes to starting a business Barrie insists that the trend is moving away from a heavy reliance on others, especially investors.
“The whole funding area has changed, you can now do in off the back of a credit card,” he says.
“Before you had to raise two, three or four million dollars in the first round but now the cost base has dropped so you can get four guys in a room, feed them noodles and get them to make your software for $20,000.”
Barrie says that success of Australian start-ups in raising money, such as 99designs and Atlassian, has put the country on the radar for US investors, but primarily credits the founders of such businesses.
“Australian venture capitalists seem to have died off, they are risk adverse and I think they’ve made all of their investments,” he says.
“If you look at tech companies it’s all being driven by entrepreneurs. Startmate, PushStart, all of those, that’s where the action is. It’s the entrepreneurs who are driving the activity not the top end of town.
“I’m optimistic over how things are heading. It’s good that it is being driven by entrepreneurs.
“Before you wouldn’t get funded if you didn’t have the ideal structure and have a real value add. Now you can start-up in a weekend. You don’t need much money because it doesn’t cost much to get a domain and get up and running.”
On-campus inspiration
Despite Barrie’s enthusiastic backing of going it alone on a shoestring he is well versed in being able to lure money from investors.
Over the course of his career he has raised more than $40 million, starting with $4 million from a hardware company off the back of a PowerPoint presentation.
The entrepreneurial bug bit early, while doing a Masters at Stanford after departing Sydney in 1997.
While he was on campus Google was launched and someone in his class started PayPal. It was clear to Barrie that the tech space provided plenty of opportunity.
His first foray, with online security firm Securify, didn’t go quite to plan and when the dot com bubble burst he returned to Australia and started work for a venture capital company.
Although the experience gave Barrie a good understanding of how the funding system works it didn’t satisfy his inner business builder.
“You read 200 business plans a day and fund two businesses a year,” he says. “I’d spend the entire day there frustrated.
“I did the job as it was the closest I could get to the industry at the time, after the dot com bubble burst. There wasn’t much of a start-up scene.”
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