from Hacker News

Gigster Fund – Freelancers Benefit When the Company and Clients Do Well

by quackware on 5/26/16, 4:57 PM with 39 comments

• by gk1 on 5/27/16, 4:17 AM

  As a freelancer (consultant), no thanks. This looks like yet another platform that commoditizes freelancers (think Upwork). The belittling name "gigster" doesn't help.

  If you're a freelancer/consultant who wants equity, ask for it. Some companies are willing to give non-qualified options (the only choice, really) after you've built up a relationship and if you're making a significant contribution to the company.

  Also, I've read the page top-to-bottom and still not fully clear on what's happening here. Highly suggest running this by non-insiders and rephrasing the messaging until it's easier to understand.

• by polishninja on 5/27/16, 3:07 AM

  It looks like Gigster will invest (money, time?) in some companies from a predetermined fund, not Gigster itself. In turn, they will share 1% of their fund equity with all Gigster developers who were active at the time, paying out when a fund company or Gigster liquidity event occurs. They will allocate rights to returns to active Gigster developers over a 1 to 5 year period.

  It looks like, as a Gigster developer, you would get 1%/total active Gigster developers. If there were 500 Gigster developers over that 1 to 5 year period, you'd get 1%/500 = 0.002% of a liquidity event depending on Gigster's weighting mechanism. If Gigster's equity stake was 20% in a company that exited for $100 million, you'd receive maybe $40,000 depending on how Gigster determines your weighted percentage.

  It's not really even the same league as a 401k or pension, contrary to what the page says.

  Calling it equity is a bit confusing. On the page it states at the top:

  "Gigster Fund provides our freelancers with access to equity from Gigster and select companies in our client portfolio."

  At the bottom it states with regards to owning equity:

  "No. Direct equity ownership or indirect ownership through a limited partnership has complex tax & legal implications, and the SEC limits the number of shareholders a corporation may have which would make direct ownership impossible after a certain number of freelancers".

  And

  "No. Direct equity ownership or indirect ownership through a limited partnership has complex tax and legal implications. In the United States, for example, Gigsters would be required by law to be accredited investors."

• by rabble on 5/27/16, 7:56 AM

  Does gigster have anything real at all? There are no gigs at all listed on their site... just a few full time jobs in SF, plus things for working on gigster itself. Seems like it might be a lean startup trick of painting the sky blue to try and build both sides of a marketplace.

• by merpnderp on 5/27/16, 3:33 AM

  Are there really tons of companies hiring freelancers to make map, music and messaging apps at ~$40k/4 months?

• by PeterProlific on 5/27/16, 6:24 AM

  This sounds great but it seems that they do more corporate work.

  Can't see freelancers retiring on a miniscule % of a muslim dating app.

  You'd think with all the quality devs being purported that there'd have to be something of quality in there although the portfolio so far is YAWN!

• by koolba on 5/27/16, 11:14 AM

  From the article, emphasis mine:

  > This allows our freelancers to receive tangible rewards for their hard work building incredible software, and helps them prepare for the future.

  Wouldn't simplify paying a freelancer be a tangible reward? And if you're not paying them then they're not really freelancers, they're either interns or suckers (or both).

  > Will every Gigster Fund company yield a successful return? No. Although some startup companies yield extraordinary financial returns, many fail.

  Ha! Great way to spin "The majority of this will be worthless ... but you buy Powerball tickets too right?"

• by bazqux2 on 5/27/16, 2:24 PM

  Giving people a very small stake in their work adds much greater inventive than cost. That alone is a good idea (See Starbucks). Emotions trump math - even for programmers. I expect the confusing terms are intenional to make the math harder.

  But... this is the same company that was giving out work quotes in less than 10 minutes. I expect gigsters existence is subsidized by VC investment and it will be unable to succeed long term. I'm not expecting good things for anyone involved.

• by orthoganol on 5/27/16, 9:46 AM

  I was always turned off by the language Gigster uses which makes me wonder about the kind of people they are:

  "Talent pedigree - 1%", "Hire All- Stars", "Marquee Investors"

  That aside, I'm not really interested in more hand-holding-as-a-service, this time aimed at us consulting developers.

• by shivam2501 on 5/26/16, 5:02 PM

  This is new and something which differentiates them from other freelance networks. Looking forward to see how it rolls out.

• by keithnz on 5/27/16, 4:26 AM

  Not quite sure about their terms and conditions. Seems very pervasive