I’ve been asked about Fiverr several times, so seeing as how I’ve been using the website for over a year I thought I’d write about it. I’m going to make this at least a three part series, released on Thursdays over the coming weeks. Today, we’re talking about reasons you shouldn't be on Fiverr if you're a freelancer.
Last week, I delved into some of Fiverr's positive aspects, mostly centered on the experience you'll gain and how the platform itself saves you some headaches. However, it's not all sunshine and roses. Like anything, there are some downsides to the Fiverr service, and I'm going to outline some of the biggest ones.
The Payment System
This is a big one, in fact it's probably the biggest issue I have with Fiverr. In a nutshell, you only get paid around two weeks after you deliver your work. The money you're paid is counted up on your Fiverr account, and you're able to use it to pay for gigs you've ordered. However, you won't be able to withdraw it (meaning it stays fake money for at least two weeks). The language used by the platform suggests the funds need to "clear" before they can be given to you. This is somewhat strange because when you pay for services, the amount is deducted from your account the moment you place the order. I'm not going to pretend I know the inner workings of the platform, but it can be a bit of a headache to wait for your money like this. Not only that, but if you're starting out as a freelancer, waiting on your hands for two weeks before you get paid isn't a good habit to build. According to some, you should even ask for a deposit before you start working. While Fiverr makes it impossible for buyers to order something without paying ahead of time, freelancers who aren't aware of this might not even consider asking for a deposit before work. So a) it sucks to wait so long to get paid and b) getting used to this payment system doesn't bode well if you work off the platform. Oh, and bonus thing, if you're Canadian (like me), you won't be able to withdraw your money directly to a USD acount. So prepare to lose out on the exchange rate.
Ok I lied, this is definitely the biggest one. Fiverr takes 20% off of every sale you make. This isn't such a bad fee if you're always making $5 sales, but it scales up. Negotiated a sick custom gig for $100? Get ready to have $20 docked from your earnings. The justificiation? Fiverr is connecting freelancers with clients, and providing you with a safe platform for your transactions. When I started out on the platform, I thought this was a great deal. I really had no idea how to find my own clients, and I was worried about not getting paid. Then I wrote a novella for $120 and was pretty disappointed when I realized I'd lose $24 from this sale. These fees aren't a surprise in any way; they're clearly outlined when you sign up. The one fee that is a surprise though? The payment processing fee. Depending on how you withdraw your money, you can expect to pay up to 3$ before you have access to your money. The amount you need to pay depends on the method you use. Withdraw to PayPal, and you're looking at 2% of the amount withdrawn, up to 1$. For a bank acccount, it's 3$ fee (plus possible additional fees depending on your location and currency). It gives you something to think about, since as a freelancer you likely already have plenty of fees and operating costs to worry about.
No Client "Poaching"
While I can understand this from Fiverr's point of view, it's definitely bad for freelancers. It's essentially against Fiverr's Terms of Service to contact any clients past, present, or future outside the platform. This basically locks you and your clients on Fiverr's platform (unless you want to risk your account getting banned). Don't even dream of trying to give your clients your contact information if you're thinking of transitioning off of the platform. If you get caught, you're done. Why is this such a problem? It goes against the very nature of freelancing and the free market. It's like Fiverr knows it's not an ideal place for freelancers to work, so it uses its TOS to keep them trapped. It's kind of like a friend telling you you'll never find a friend like them to keep you around. While they take your money. It's not a good time.
There's my big three issues with the platform. With that in mind, next week we'll be looking at the most important things I learned from Fiverr and how I've turned it into a positive experience. That's Thursday next week, and you'll definitely want to read this one.