Toptal Acquires Skillbridge and Broadens Its Scope Beyond Technical Talent

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Toptal, a network of freelance software engineers and designers, announced Tuesday it acquired Skillbridge, an online talent marketplace for non-technical business professionals, for an undisclosed amount.

According to Toptal CEO Taso Du Val, the acquisition is a win-win for both companies. Skillbridge will be able to leverage Toptal’s client and candidate management platform capabilities to accelerate growth and scale in the business professional market. Toptal will benefit too. By bringing Skillbridge’s broader network of “top-tier elite business freelancers” onto its platform, Toptal extends its business into a attractive adjacent market segment of enhancing scale and platform economies. The acquisition is Toptal's first entry into non-tech talent market, Du Val said.

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Toptal saw Skillbridge as one of the best — if not the best — companies in the talent marketplace space, Du Val said. Its client base includes five of the top 10 largest private equity firms in the U.S. among other businesses in a range of different sectors. There is also value in the client base and network of freelance talent that Skillbridge has built. The two Skillbridge founders will be joining Toptal, Du Val said.

Spend Matters Analysis

Toptal, founded in late 2010, has distinguished itself as a unique vertically-focused, managed freelancer platform (in contrast to the more well-known open, multicategory freelance marketplaces). In particular, Toptal maintains a network of freelance developers and designers that consists of only the top 3% of those who apply. Moreover, Toptal is not self-service — its staff handles every request for talent from each client, determine the best matches and provide optimal candidates back to the client. (We should note, however, that platforms like are beginning to offer similar services — e.g., Upwork Pro.) Toptal is also different from a typical online freelancer marketplace, in that payment processing is not a part of the platform services. (Left to the client and freelancer, Toptal is relatively free of worker classification issues that have plagued many other platforms.)

Skillbridge, founded in 2013, pursued a model that was different in a number of ways. While the business does appear to have a vertical focus on freelance business professionals, the reality is that this category contains a large number of roles that may also vary by sector or location. (This is different from Toptal’s focus on fairly standardized technical roles.) Also, Skillbridge’s matching process seemed to be much more reliant on technology (Talent Dynamics™ machine-assisted matching system) and more focused on time-to-fill, and it is not made clear how freelancer are vetted to become part of the talent network. Finally, Skillbridge, as compared to Toptal, is much more of an online freelancer marketplace platform, in that it contains project management workflow capabilities as well as payment processing, which has a range of implications.

The transaction looks like a well-reasoned consolidation play. Toptal is able to extend its market reach into an attractive adjacency and enhance its scale/platform economies, and possibly network effects. One advantage may be to be able to offer client businesses a broader range of talent, and thus value. Acquiring a company’s network of clients (and in this case talent) is often a successful play, with minimized complication and cost of integration. That said, the Toptal team may face some — but not at all insurmountable — challenges in taking on a talent segment population that is much more heterogeneous than the technical one. But once again, there are many ways to skin this cat.

In the bigger picture, this acquisition again raises a question that observers of the freelancer online platform space have been asking for a while: Is there a consolidation stage ahead, particularly in the freelancer marketplace platforms space? While little consolidation has occurred (outside of and Upwork), there are some other data points. Just a few weeks ago, German platform twago acquired Madrid-based Adtriboo. And we have also heard from some industry insiders that there seems to be an increase in platforms that are seeking to be acquired. All in all, this suggests models and strategies that haven’t worked and scaled.

As far as the combination of Toptal and Skillbridge goes, the future seems auspicious, but uncertain. Skillbridge competed with vertical players like HourlyNerd, MBA & Company, Upwork, and others including LinkedIn. Toptal has probably had less competition to-date and not as direct. Foremost may be Appirio (aka TopCoder) and marketplaces like Upwork.  Expanding the scope of the offering and value proposition to clients, without getting too spread out (too many options, focus on limited high value business freelancer roles) may be key.

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