The Freelancer (ASX: FLN) share price soared 31% higher on Friday after announcing a partnership with eBay.
What is Freelancer?
Freelancer operates the world’s largest freelancing and crowdsourcing marketplace by total number of users and jobs posted. Freelancer also operates a large escrow or secure online payment service called escrow.com.
Why did the share price jump?
The company announced that eBay Motors has partnered with Escrow.com to give buyers added security when trading used vehicles and vehicle parts online.
Escrow.com is integrated into both the eBay Motors website and the mobile app. Users can select the digital payment option for both the website and new eBay Motors app which launched in December 2019.
With Escrow.com as the chosen payment method, funds are held safely in escrow while the vehicle is tracked and delivery is verified. Once the vehicle arrives and is accepted by the buyer, the transaction is closed out and the seller receives the proceeds of the sale, securely via Escrow.com. If there is an issue with the purchase, the vehicle can be returned to the seller and the funds are returned to the buyer.
Buyers can inspect vehicles before the funds are sent to sellers to ensure vehicles are as described in the listing and protects buyers from fraud. This makes it easier to transact over long distances. The first transaction was for a car sold in California to a buyer in New Hampshire, a distance of 3,000 miles.
It’s an operational offering to eBay users which will be changing consumer behaviour and coupled with an education campaign. Freelancer is unable to forecast the revenue impact. But the market seemed to really like it and it could lead to a good increase in volume for Freelancer.
I’m not sure if it’s a buy, the price has already rocketed – the company has a lot of promise but COVID-19 may have sent the company’s trajectory back for a while.