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99Designs, DesignCrowd dominance highlights our marketplace hub

Monday, 07 March 2016
99Designs, DesignCrowd dominance highlights our marketplace hub

Australia's emergence as a hub for online marketplaces has been highlighted by Sydney's DesignCrowd reaching 500,000 registered suppliers, yet still being only the second-largest locally founded business in the design vertical.

The world's largest marketplace, the 19 million-member Freelancer, is listed on the ASX, while the largest in the vertical of creative assets for web designers, Envato, calls Melbourne home.

DesignCrowd founder Alec Lynch has a theory on why Australia punches so far above its weight when it comes to online marketplaces.

"Marketplace start-ups are a great business model for Australian entrepreneurs, particularly if you're trying to go global," he told a Blackbird Ventures "ask me anything" session in February.

"In particular, service marketplaces or marketplaces with digital assets, where services are delivered online, remove the need for an on the ground presence when launching overseas. You don't need salespeople, you don't need a physical presence and you don't need inventory in those markets."

Lynch is recognised as a founder of the design crowdsourcing concept, where designers compete for posted jobs in an iterative exchange with the client, with the winner getting the commission but several runners-up rewarded for their input with cash prizes.

Launched in 2007 with $70,000 on credit cards and loans from family and friends, DesignCrowd has gone on to raise $12 million in venture capital, produce nearly $20 million in annual revenue and employ 48 people across offices in three countries.

This is an extract from an article originally published on the Australian Financial Review website.