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The risks and dangers of freelance marketplaces

Posted on Dec 2nd, 2018 | Running a business

The risks and dangers of freelance marketplaces - Crunch - Image of a person typing on a laptop.

Freelance marketplaces are theoretically brilliant because they can bring you work from the four corners of the Earth. But the global, anonymous nature of the network also has downsides. Most significantly – it’s incredibly easy to create a fake profile, engage a gaggle of freelancers and then disappear with a clutch of free work.

How can you spot a fraudster on freelance marketplace sites like Upwork?

The following should ring alarm bells:

  • Emails from Gmail or Hotmail accounts. Now, that’s not say that professionals can’t send you emails from these domains – it’s just that you wouldn’t expect it. HMRC won’t use a Gmail address, just as the CEO of a major London bank wouldn’t email you from gam0rgeek518@hotmail. If you see a “non-professional” email address, treat it with caution
  • Wants to conduct conversations away from the platform – or deviate from the platform’s recommended processes. This may suggest they’re trying to fly under the radar of the marketplace.

Upwork and their ilk have systems designed to protect both the freelancer and the client, but you can render them useless by contravening their terms. Whenever possible, work within the rules of your chosen marketplace – it’s for your own good!

Low pay

Jobs on freelance marketplaces might be abundant, but they can also be terribly paid. The global nature of freelance marketplaces is wonderful in many ways, and it works brilliantly for many freelancers and clients, but the system generally favours people who have a lower cost of living.

We’ve put together a list of freelance job sites that can actually pay well – of course you still need to proceed with caution, but we’ve heard good things about these ones.

Low standards

A large proportion of gigs posted on freelance marketplaces are low-value and low-prestige. These jobs might be great fodder for the newbie, but they’re no good for anyone wanting to build a profile or challenge themselves.

What kind of client uses oDesk, Upwork, Guru and Freelancer.com? Typical clients using these services are:

  • Small businesses with limited funds
  • Startups with small budgets
  • Scammers with no intention of paying
  • SEO practitioners who need “stuff” to fill their “websites”.

So while you might find a very rewarding job with a genuine family-run business, you may have to dodge a lot of bullets first.

Your future is in their hands

Freelance marketplaces reward your devotion. You do a few projects, get some badges to add to your profile, receive some nice feedback and you feel like you’re succeeding. You now find it easier to win the low-value, low-prestige jobs, and can spend less time writing proposals and more time earning $12 an hour.

But, if you build your reputation on Upwork or Guru, your reputation is confined to that service. The credentials you amass on someone else’s network are very hard to transfer. Sure, you can add those projects to your portfolio, and copy and paste the feedback, but ultimately your eggs are all in someone else’s basket.

If you build your reputation in the real world, it’ll grow legs and carry you far. If you do great work for a local business, other people will hear about it. Instead of getting referrals from some other SEO/spammer/conman, you’ll be getting calls from reputable businesses keen to pay you a fair price for valued work.

Build yourself a website instead

Why not invest time in creating your own web presence? If you can create an Upwork profile, you can definitely create a website. Make your own online marketing funnel and free yourself from the grubby mitts of the freelance marketplaces.

What if your freelance marketplace goes bust? Or starts charging you fees? Or bans you for life? These are more good reasons for ensuring your profile (and the value you’ve built from it) isn’t confined to just one marketplace.

You could create your own small business website in minutes using (amongst others):

  • WordPress.com
  • Weebly
  • Wix
  • Squarespace.

Need help finding decent leads?

Our article “Generate leads for your small business – the ultimate checklist” gives you a great summary of all the ways you can find new customers. Give it a look – you may not have thought of some of them!

Download our jargon-free freelancing guide!

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Written by Lief Kendall

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