Crowdsourcing marketplace Freelancer has posted positive operating cash flow of $1 million for the first quarter of this year.
â€œFreelancer again achieved exceptional results in Q1 with record receipts from customers and projects and contests posted. We also moved from negative cash flow in Q4 2014 to positive cash flow in Q1 2015,” Freelancer CEO Matt Barrie said.
The front-loaded cost of development that is attached to building a tech company means many take years to become cash flow positive. For a tech business, it’s a significant milestone.
“Tech companies have heavy front loaded [costs] because the primary cost for technology companies is intellectual capital – engineers to build product,” Barrie said.
Releasing its quarterly cash flow statement for the three months to March 31, Freelancer experienced record cash receipts of $8 million, up 8.2% on the previous quarter and up a whopping 42% compared to the same period a year ago.
At the end of March the company had cash balances of $22.1 million, an increase of 9.6% from $20.2 million as at the end of 2014.
The company has been earnings positive for most of its history, Barrie told Business Insider. He explained there have been two exceptions – one in 2011 where the company was slightly negative and one in 2014 which he said was run “deliberately” so it could expand post IPO.
“In 2014 it was still really operating at neutral,” he said, adding operating cashflow was -$0.1 million “which is as close to zero as you can get”.
Operating NPAT for last financial year was -$1.5 million.
It’s been nearly 18 months since Freelancer listed on the ASX, when on its first day of trading it hit five times the initial public offer price. It was the third biggest opening ever achieved on the ASX and valued the company at a billion dollars. Today, the share price was at $0.98.
Since listing, Freelancer has made a number of acquisitions to expand its community.
Last year it bought out online marketplace Warrior Forum, virtual content marketing community fatero.com and Polish online services site zlecenia.przez.net. It also launched a domain exchange website called Freemarket and this year added Israeli site DoNanza.
User growth has also been solid. At the end of March Freelancer had more than 15 million registered users.
This year the company overhauled its platform to refine the user qualification process and improve the user experience. It also rejigged its algorithms to improve search on the site and better match projects with the right freelancers.