Thumbtack Business Model: How the Thumbtack Works & Make Money?
With changing times, technology has affected every niche of the industry, and the result is now there are numerous services available online, and Thumbtack is one. The home services platform has been introduced in the market with the concept of providing professional services to users in need. Read the article to learn more about the Thumbtack business model, how it works, and makes money.
Working on a fresh and innovative concept, Thumbtack holds a great scope in its development and is becoming increasingly popular among the masses, which includes users and professionals also. Being a platform that provides professionals with multiple job opportunities that too, according to their preferred working hours, Thumbtack has surely earned its fan base with the facilities it offers.
To aggressively expand the scope, Thumbtack has launched the first-ever home care experience. The platform is designed to create long-term partnerships with homeowners in the care of the biggest asset. The company has provided a number of offerings to people; more than 68% of homeowners who feel confused, stressed, and overwhelmed maintain their homes. This experience helps homeowners know whom to hire, when, and what to do.
What is Thumbtack?
Thumbtack is a platform providing skilled personnel a chance to find suitable jobs. Also, the customers wanting to avail the services from the professionals are facilitated to just post their requirements on the platform, and the professional will contact them as soon as they find the work falling under their skill area.
Since 2008, Thumbtack has been connecting small businesses and individual professionals with users in need of services and is running excellently. Thumbtack recently announced that it’s adding a multinational brands leader to its board.
Thumbtack Success Story and Funding History to Have Quick into!
Thumbtack business type: Private
Thumbtack site type: Consumer service
Available in: English
Founded: 2008; 14 years ago
Headquarters: San Francisco, California
Founder(s): Jeremy Tunnell, Jonathan Swanson, Marco Zappacosta, and Sander Daniels
CEO: Marco Zappacosta
Thumbtack Valuation: $3.2 billion.
Type of Services on Thumbtack: 1,100 types of services
Thumbtack Pro Median Annual Income: $61,000
The American home services company has more than 70 million projects. The company believes in helping customers with their home care. Thumbtack enables users to search for professionals and their service rates.
Customers can hire local service providers to work on different personal projects, including legal services, event planning, home improvement, and other services on their requirements. The company is backed by Tiger Global Management, Capital G, Sequoia Capital, Baillie Gifford, and Javelin Venture Partners, among others.
Sneak Peek of Funding History of Thumbtack
In 2010, Thumbtack raised around $1.2 million in funding from angel investors. In 2012, the company raised around $4.5 million through a Series A round. The American home services platform raised about $12.5 million through a Series B round.
In 2014, Thumbtack raised about $30 million through a Series C from Tiger Global Management and Sequoia Capital. In 2014, the company raised from a Series D round led by Google Capital. Thumbtack raised around $125 million, led by Baillie Gifford in 2015.
Thumbtack home services platform raised $150 million in Series F at a valuation of nearly $1.7 billion in 2019. The company raised $275 million at a $3.2 billion valuation in 2021. The increasing funding and shifting focus of Thumbtack home services underscore some of the changes we’ve seen among customers in the last few years.
Thumbtack helps people to make a better place to live and keeps them in the best shape overall. This is why it sees an opportunity being a marketplace to search the pros for one-off jobs you might require to be done around the house and offer a “home management” platform to cater to new customer’s attention. The services that customers can book include emergency repairs of electrics in the home, gardening, preventative maintenance, and more.
Thumbtack helps users to find professionals to help them on different projects. The platform has released its list of the “Most Festival Cities in the US” the list is based on project data they have collected over 2022. The cost of hiring a holiday lighting expert is between $160 to $300, and lights designed for outdoor trees can cost more than $60 depending on the height, type, and shape of the tree.
How Much Does Thumbtack Pay?
On average, Thumbtack pays $116,458 a year and $55.99 an hour. In a year, Thumbtack pays the lowest earners $75,000, while the top 10% are paid around $180,000. The salary mainly depends on the department you work in.
The average yearly salary of the employees in the business development department is around $149,489, whereas the average salary of the employees in the engineering department earns $131,534. Want to know how geography influences how Thumbtack pays employees located in San Francisco, CA, Redmond, WA, and New York? NY, earn the highest salaries.
Thumbtack Business Model: How Thumbtack Works?
An online platform, Thumbtack connects customers with local professionals like house cleaners, yoga instructors, plumbers, etc. It follows a simple model to satisfy all the requirements of both people looking for jobs and those who’re ready to provide their professional services. Let’s check more on Thumbtack Business Model to find out how it works and provides an amazing service experience.
The multi-sided Thumbtack business model primarily has two interdependent customer segments:
Customers: Those looking for professionals like Gardner, plumbers, etc.
Service Provider: Professionals who are ready to provide their service to earn extra income
Three main value propositions of Thumbtack are as follows:
The Thumbtack business model provides quick access to users by connecting them to local service providers. The marketplace platform caters to customers’ needs by helping them to find professionals to help them complete their daily chores speedily. Customers get a chance to choose from 1,100 project categories, from home services to gadget repair and more.
Thumbtack provides its service in over 50 states. The marketplace has built a strong presence resulting in its success. Thumbtack is the largest marketplace platform for appointing professionals as per users’ requirements. It works with more than 500,000 professionals, helping them earn $1 billion a year. It manages 160,000 customer requests per week and 7.1 million customer projects annually, requested by over 5.2 million customers.
The main channels through which the marketplace platform offers its services are the company’s website and mobile apps. The marketplace platform uses social media to promote its services, offering, and more.
The self-service nature of Thumbtack helped the company to build strong relationships. Users can download a mobile app or visit the website to interact with employees. The on-demand marketplace platform offers essential resources like cost estimates, a guide to hiring professionals, and access to FAQs.
Key Partners and Key Resources
Thumbtack has formal and strategic partnership programs helping them to advance their interests. The company announced an alliance with WhoDoYou, a social recommendations service.
The collaboration between the two allowed serving an exclusive benefit for WhoDoYou’s customers in 2016. Later in the same year, the company also announced a partnership with Monrovia, an edible plant seller.
Employees/professionals are the main resources for Thumbtack to earn. The company relied on funding when it was launched; it raised around $273.2 million from 20+ investors as of now.
Thumbtack follows a cost-driven structure to decrease expenses through low-price value propositions and automation. Marketing expenses and fixed cost mechanism is one of the main drivers for the on-demand marketplace services platform. The major drivers for the service platforms are customer support, product development, administration, etc.
How Does Thumbtack Work?
Thumbtacks marketplaces operate by a customer-facing platform. Enter the zip code and select the services from many categories. Users can select the preferred contractors from the services list generated. They can easily filter the search results by pricing, reviews, available dates, and estimated completion times.
With contractors’ post profiles and customer ratings, users can check the reputation of professionals on site. Customers can visit the platform to communicate with service providers and discuss details of the projects before choosing professionals. The Thumbtack Guarantee program ensures that each user receives the services they want.
Thumbtack Revenue Model: How Thumbtack Makes Money?
Single revenue stream Thumbtack revenue model helps a company to make good money. The company charges fees from service providers to generate leads. The marketplace platform doesn’t interfere in the transaction; they earn when customers choose to hire the service of a particular provider.
Thumbtack promotion makes it easier for service providers to pay an additional amount to promote the listing and profile. The Thumbtack promotion package helps professionals to have better visibility over other listings, helping them increase their business. The lead pricing differs based on many factors. The contributing factors of the service fees generated by Thumbtack include work type, geographic location, competition in the niche, etc.
The on-demand service platform enables professional service providers to purchase credit before activating the profile and listing. The approach enables the service provider to plan their working strategy and bid on projects automatically. In 2017, Thumbtack introduced Instant Match Technology with its AI pairing users with providers. Before the innovation, service providers had big manual jobs, resulting in great opportunities.
The AI proves to cause lots of professionals, damaging the marketplace service platform’s reputation. Thumbtack does not charge costs for the jobs that service providers get from customers. They need to only pay at the initial level quote. The platform cost between $1.50 to $1.42.
Service providers can use the platform to enjoy bulk credits. They can invest in about 12 credit packs, costing them $17.99, a pack of 24 credits, which costs $34.99, or a pack of 60 credits for $84.99. Service providers who wish to provide the service through Thumbtack can start with 10 quote packages. Once the service providers send the quotes, they have professionals send ten quotes; they have to choose a credit package to deliver continuous quotes and service on customers’ demand.
Thumbtack Business Model: Why You Must Follow the Same for Your Business?
Thumbtack business model is really amazing to consider for your marketplace or service business. You can build an app like Thumbtack to give a digital touch to your business. You can follow the Thumbtack business model to ensure your business’s success and growth. Just specify your requirements, and White Label Fox can help you with the same. Contact us today at: [email protected].