how-does-airtasker-make-money

How does Airtasker make money?

  • Airtasker is an Australian online and mobile marketplace where users can outsource various tasks. Co-founder Tim Fung got the idea for the company after enlisting a friend to help him move furniture.
  • Airtasker makes money by charging users a booking fee whenever they post an advertisement to the platform. The exact fee depends on the value of the work to be performed.
  • Airtasker also charges a service fee to providers once the task has been completed. The service fee operates on a sliding scale according to how much value the provider adds to the Airtasker marketplace.

Origin story

Airtasker is an Australian online and mobile marketplace where users can outsource various tasks. The company was founded by Tim Fung and Jonathan Lui in 2012.

Fung got the idea for Airtasker after asking a friend to help him move furniture:

The poor guy said he’d helped people move like four times in the last few months, and it got me thinking. Why do we always lean on friends and family to help us do stuff, when there’s a band of willing and able people out there, who’d welcome the chance?”

Fung then teamed up with former colleague Jonathan Lui, with the pair managing to raise $1.4 million from investors at former employer Amaysim.

To promote his idea, Fung paid someone $1000 to line up at the Apple store in Sydney and secure him the first iPad 3 in Australia.

The individual was a former truck driver who had recently been made redundant, so this proved to be good publicity for the fledgling platform.

Airtasker was officially launched in February 2012, with another round of investment funding used to develop an iPhone and Android app.

Various safety features were also added for buyers and sellers to increase trust in the platform. Growth continued unabated in the next few years as Airtasker acquired several direct competitors. 

In 2015, it announced a crucial partnership with consumer electronics and white goods retailer The Good Guys.

As part of the deal, Airtasker would provide customers with home installation services for various products including televisions and fridges. A similar deal for furniture assembly services was also struck with Ikea two years later.

Since its inception, Airtasker has enabled more than $1 billion in working opportunities with the platform surpassing 500,000 members in September 2021.

The majority of jobs on the Airtasker network relate to home and garden, delivery, removal, and trade services.

Airtasker revenue generation

Airtasker makes money by charging booking fees and service fees. Let’s take a look at these fees in more detail below.

Booking fees

The booking fee is charged to the person who is looking for someone to complete a task, with prices starting at $2.90. For more expensive tasks, such as those incorporating home renovations, the booking fee is capped at $24.90.

Service fees

Service fees are used to cover the costs associated with operating the Airtasker marketplace, including those related to fraud protection, insurance, support, and secure payment systems.

Service fees are charged for every task that is completed. The company rewards service providers who are professional, reliable, responsive, and honest with lower fees according to a sliding scale.

The scale is represented by four tiers: Bronze, Silver, Gold, and Platinum. In Australia, for example, the service fee structure is as follows:

  1. Bronze tier – 20%.
  2. Silver tier – 16.4%.
  3. Gold tier – 12.7%.
  4. Platinum tier – 10%.

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Platform Business Model

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A platform business model generates value by enabling interactions between people, groups, and users by leveraging network effects. Platform business models usually comprise two sides: supply and demand. Kicking off the interactions between those two sides is one of the crucial elements for a platform business model success.

Marketplace Business Model

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A marketplace is a platform where buyers and sellers interact and transact. The platform acts as a marketplace that will generate revenues in fees from one or all the parties involved in the transaction. Usually, marketplaces can be classified in several ways, like those selling services vs. products or those connecting buyers and sellers at B2B, B2C, or C2C level. And those marketplaces connecting two core players, or more.

Network Effects

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Asymmetric Business Models

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Attention Merchant Business Model

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In an asymmetric business model, the organization doesn’t monetize the user directly, but it leverages the data users provide coupled with technology, thus having a key customer pay to sustain the core asset. For example, Google makes money by leveraging users’ data, combined with its algorithms sold to advertisers for visibility. This is how attention merchants make monetize their business models.

Wholesale Business Model

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Retail Business Model

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A retail business model follows a direct-to-consumer approach, also called B2C, where the company sells directly to final customers a processed/finished product. This implies a business model that is mostly local-based, it carries higher margins, but also higher costs and distribution risks.

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Open-Core Business Model

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Freemium Business Model

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Freeterprise Business Model

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Franchising Business Model

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