OneSpace Closes $9M Series B Round

FusionOps funding

Last week, St. Louis-based OneSpace closed a $9 million Series B round. OneSpace, formerly CrowdSource, describes itself as “a virtual workforce platform that brings businesses and freelancers together.” The four-year-old company said the new funds will fuel its continuing growth and the market introduction of its new enterprise-focused SaaS platform, now under development and expected to be released later in 2016. The funding is an investment in the company’s on-going evolution, as it configures and positions itself to serve its clients and markets in more valuable ways.

“Since 2012, our team’s mission has been to create a best-in-class platform for accessing and managing cloud-based talent,” Stephanie Leffler, CEO of OneSpace, said in a press release. “We have proven our technology and we’re now ready to put the power of our platform in the hands of enterprises who are, by far, the largest buyers of flexible talent.”

The OneSpace Series B round was led by Lewis & Clark Ventures, along with Highland Capital, the lead of the Series A round, and Answers Corporation executives David Karandish and Chris Sims. The investment, which brings total funding to $21.5 million, is yet another funding event in the increasingly capitalized work intermediation platform space, which continues to see both new entrants and the evolution of players already in the space.

Spend Matters had a chance this week to speak with CEO Leffler to gain a bit more insight into the company and its evolution, past, present and future.

Where Did OneSpace Come From?

Leffler told us the early concept and technology for OneSpace originated as an internal freelance management tool within an e-commerce company, where Leffler had also served as CEO. The platform was spun-off as a private company, CrowdSource, which, as the name implies, was a kind of managed service crowdsourcing platform. Business clients contracted with CrowdSource for a certain service (e.g., ongoing updates to product descriptions on an e-commerce website, and CrowdSource delivered the service with its own vetted online freelancers and its own platform tools and processes.

In late 2012, the company raised $12.5 million, at which time it had already built a crowd of 500,000 who could be eligible for work.  

In mid-2013, the company launched Transcribe.com, adding audio and video transcription solutions to its various other managed crowdsourcing service offerings. At that time, the company reported its online crowd stood at 10,000 freelancers and that it was serving national clients, including Bazaarvoice, Citysearch, Dictionary.com, and Toys"R"Us.

In late 2013, the company acquired Servio, its main competitor in the crowdsourced “content at scale” market segment. This acquisition brought IP and talent, online freelancers and new customers, including retailers such as Overstock, Staples and online publishers like Orbitz and CBS/CNET.  

Going forward, the company offered four main types of crowdsourced services or solutions: copywriting, content moderation, transcription and data solutions.

In late 2015, the company signaled the next leg of its journey with its rebranding to OneSpace, which was followed some months later by the recently reported $9 million Series B round.  

OneSpace Today and Tomorrow

Leffler spoke with us about the current stage of evolution of the company. In the early years there was a decision to offer a managed service model, entering into service agreements with clients who would receive specific services delivered by OneSpace that in turn leveraged its technology and vetted crowd to produce the service outputs — much like an outsourcer.  This also served the purpose of gaining customer experience in order to gradually develop a customer-facing platform.

Now OneSpace, while continuing to provide its managed services, is extending its business and service model with a new enterprise-focused SaaS solution, which will offer:

  • Direct online access for enterprise clients as well as integration with other enterprise systems and processes
  • A broad range of capabilities that enable enterprise users to manage the deployment of workforce in projects and other activities
  • Ability to source and manage both online external workforce and internal employed workforce all in one place (hence, OneSpace).

Along with the above, there is another shift in how OneSpace goes to market and what it offers to its customers. Previously, it was service outputs managed and delivered by OneSpace. Now the company is providing an enterprise workforce management and the ability to engage individual online freelance workers, not just the services that such freelancers produce.

When asked about the future, Leffler told us that the company has been pursuing a “platform-first” strategy and that a few years from now she expected OneSpace to be a true platform business that will serve as a central workforce hub connecting enterprises, internal employees and external talent, managed services and other ecosystem participants, including software developers.

Spend Matters Comments

OneSpace is notable for a number of reasons. The company:

  • Has exhibited progress through a series of seemingly well-orchestrated moves and at a controlled pace, while moderately consuming capital
  • Is a case study for how a work intermediation platform can evolve, from the spin-off of a minimally viable product, through acquisitions and two-sided platform development and scaling, and finally to platform extension
  • Is a good example of a hybrid work intermediation platform, supporting a number of different service and software models but not a marketplace model
  • Is a crowdsourcing platform, a platform category that has gained considerable traction with large enterprises — something online marketplace platforms have not yet been able to achieve
  • Has established a vetted crowd of vertically segmented freelancers in an overarching segment of “content development” with various role specializations (e.g., writers, editors, photographers).  This, along with the traction with large enterprises, may prove advantageous in the launch and adoption of the SaaS enterprise workforce management platform.

The recently reported funding round is notable. But this may not be the real news. The real news is where OneSpace has been and where it is going, along with the clear vote of investor confidence in the path OneSpace is on. Spend Matters will be watching OneSpace very closely — and with great interest — as the company continues forward on its path.

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