Online Staffing/Human Cloud Trifecta:, Elance and Something Else

It seems that in the small emerging space of online staffing and human cloud platforms there is some new development or announcement every week. Because I monitor this space daily, week after week, I can assure you that this is not an exaggeration (it’s actually a challenge to keep up with all the developments, among which there are often significant, even game-changing ones).

Last week was particularly eventful:

  • First, the IPO came to term on the Australian exchange last Friday, with a pretty impressive result
  • Second, on Thursday, Elance announced it would be partnering with IBM to leverage the company’s super smart, cognitive computing platform (Watson), a further extension in Elance’s apparent ecosystem development strategy.
  • And last but not least, on Thursday evening, I was thrilled to hold the inaugural meeting of the SF Bay Area Online Staffing and Human Cloud/Cloud Labor Meetup Community.

Here, I briefly review each of these developments — certainly clear indicators that momentum in this space is picking up. IPO
The significance: This is a milestone event for the online staffing segment, the first platform company to (a) go public (with less than AUS$90 million in gross spend on the platform projected for 2013) and (b) fully open up its financial statements. Note: AUS and US dollars are trading about 1 to 1.

In my blog post in October (“’s IPO Prospectus Allows a Look Under the Hood of a Large Global Online Staffing Platform Business”), I reviewed the IPO prospectus published, shortly after the IPO process commenced and registrations for initial pre-IPO share purchases was opened (30 million shares at AUS$0.50 a share, with computed pre-IPO valuation of AUS$217 million). The key info about the financial performance data of can be seen in this table from the prospectus. 

Click image to enlarge.

Check out that blog post for more info about the company and the prospectus.

This past Friday, it turned out that those who paid $.50 a share for the stock did quite well. The stock closed at the end of the trading day at $1.60, bringing the market cap of the company up to AUS$700 million. Today, the stock was trading at about $1.80 per share. 

I don’t think there’s much more commentary or explanation needed here, at this point. 

Elance and IBM Watson
The significance: After recently announcing partnerships with Smarterer and SkilledUp (skill testing and learning services), Elance continues its digital services ecosystem building with IBM and its Watson cognitive computing platform and launches a new kind of extended-enterprise workforce management solution for IBM.

In my September post, Is Elance Pointing the Way to A New Labor Market Function for the Staffing Industry?, I pointed out how the Smarterer and SkilledUp relationships demonstrated “how online service platforms can be used (even in the staffing intermediation business) to create value in innovative ways by developing “service ecosystems” that digitally link together and merge partner services into new value-creating configurations (in this case, work arrangements, skills testing and learning capabilities).” Now it appears, according the press release from last Thursday, Elance is continuing this strategy with IBM, connecting its platform with the Watson platform ecosystem.

The gist of the arrangement between Elance and IBM is this: IBM has developed an amazing cognitive computing technology — called Watson — over past years, and IBM wants to push Watson’s capabilities out into more commercial applications. To do this, it is making Watson a platform that can be extended (by software developers) into different commercial applications in different industries, etc. In effect, there will be an ecosystem of commercial applications that leverage the capabilities of the Watson. But these applications need to be built by software developers, who are therefore a necessary part of the ecosystem. Making those “IBM Watson-certified” software developers available to work on such applications is what the IBM and Elance partnership is about. As the press release states: 

“The move comes as a part of IBM’s larger announcement today that it is opening up IBM Watson as a development platform for entrepreneurial software application providers – ranging from start-ups to established technology leaders such as MD Buyline – to create apps in the cloud infused with Watson's cognitive computing intelligence.” 

But such software development efforts will need an adequate supply of IBM Watson-certified software developers. Accordingly: 

IBM will leverage the Elance Private Talent Cloud™ solution in order for IBM’s app development partners to easily find, hire and collaborate with IBM-certified talent who have specialized skills, including:

  • Big Data and Analytics: information management, data ingestion, data mining, curation, statistics and artificial intelligence
  • Computational Linguistics: natural language processing, taxonomies
  • Mobile Application Development & Deployment
  • User Experience and Design

In effect, IBM will use the Elance platform as a way to supply/bring skilled and knowledgeable software workers into the Watson ecosystem to develop the commercial applications that will leverage the Watson cognitive computing platform. 

The Inaugural SF Bay Area Online Staffing and Human Cloud/Cloud Labor Platform Meetup.
The significance: A sign of the times, a community is starting to develop in the SF Bay Area to bring together a range of professional interested in understanding and promoting the understanding of Online Staffing and Human Cloud/Cloud Labor Platform.

The Online Staffing/Human Cloud platform space is a complex and broad one consisting of providers of innovative platforms, entrepreneurs and investors, and businesses and professionals that are a part of the existing staffing industry today (e.g., staffing and VMS providers, HR and contingent workforce professionals, et al). The community has be formed as: A “non-aligned,” non-profit, professional community dedicated to developing and promoting knowledge and awareness of “online work arrangement intermediation platforms.”

In the inaugural Meetup, which was hosted by Elance at its meeting facility, about 40 professionals gathered for a reception and networking which was followed by a panel discussion of industry participants/ thought-leaders. 

The inaugural meet up attracted a highly diverse crowd (including professionals from staffing and VMS firms, and even out-of-state visitors). The networking discussions among this diverse group were, to say the least, vibrant.

The panel discussion, “The Use of “Online Workforce” by Mid to Large-Sized Enterprises: What Lies Ahead?” featured a high-powered, highly-engaged panel:

  • Rich Arnold, CFO and VP Strategy & Corporate Development, Crowdflower (2011-present)
  • Jon Diller, VP Enterprise Solutions, Elance (2007-present)
  • Michael McNeal, Vice President of Talent Development, M&A integrations and HR products, Intuit (2003-13)
  • Jeff Phelps, COO, iWorldGlobal/Nelson Compliance (2011-present)
  • (Moderator) Andrew Karpie, Principal Analyst, The Research Platform and Affiliate Analyst, Staffing Industry Analysts

The interest level in this group was outstanding. It was not easy to break off the networking and conversations to get on with the panel at 7 p.m. Then once the panel got started, the attendee and panel Q&A and discussion (which was supposed be over at 8 p.m.) ended up going well beyond that time (even past 8:30PM).

It appears there is an interest in this subject from a lot different perspectives. The next MeetUp will take place in mid-January (date and location TBD).


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