Fiverr vs. Pareto: A Comparison for Your Startup’s Outsourcing Needs

Before diving into our Pareto vs. Fiverr standoff, let’s look at how Fiverr works. Over the next section, you’ll learn everything there is to know about Fiverr and how it works.

Fiverr is an Israeli marketplace founded in 2010 in Tel Aviv by Micha Kaufman and Shai Wininger. This groundbreaking platform revolutionized the freelance industry by introducing a two-sided market where users could both buy and sell services.

In a nutshell, freelancers sell their skills to businesses or individuals looking for professionals to hire. Users may resort to Fiverr for specific one-time needs (for example, designing a company logo) or needs that do not require hiring full-time team members (for example, recurring translations).

Fun fact: When Fiverr was founded, all gigs were priced at $5, which is where the name came from.

Compared to the competition, such as Upwork and Freelancer, Fiverr is more geared toward one-off gigs than longer collaborations. The interface is easy to navigate, which is why Fiverr is a good place for new freelancers to get started.

Freelance marketplaces are online platforms that connect independent workers and potential clients. Businesses and individuals use these platforms to find freelancers with specific skill sets, to meet temporary needs, or even to establish long-term business partnerships.

Freelancers use these high-visibility platforms to showcase their portfolios, choose which jobs to apply to, and get in touch directly with potential clients (sometimes behind a paywall). The array of services is extremely varied and both the client and the freelancer define their conditions for the price range and deadline.

To make a profit, freelance marketplaces charge a fee on both the freelancer’s revenue and the client’s payment. Additionally, most offer payment plan options with special perks both for businesses and freelancers.

Among the 830,000 freelancers active on Fiverr, the categories seem unlimited. Buyers can find any needed service from the typically requested logo design to the most niche query imaginable. If you want to find someone to draw your pet as a superhero… you can. Or to read your astral chart in French. Or to ghostwrite rap songs. The possibilities are truly endless.

Most buyers come to Fiverr looking for:

• Graphic design, especially logos and brand identity;
• Digital marketing, such as social media management, search engine optimization (SEO), and email marketing;
• Writing and translation, proofreading, and editing;
• Video editing, subtitling, and animation services;
• Programming, website creation, and application development.

These are some of the most common examples of one-off outsourcing needs that bring new and established businesses to Fiverr.

Other marketplaces, such as Upwork and Freelancer, rely on “bids” where freelancers battle each other. This can be a nuisance for both buyers and sellers. Buyers end up with hundreds of applications to sort through and sellers underprice their service to stand out.

Fiverr operates through “gigs” and allows the freelancers to price each gig (i.e. each task offered) from $5 to $2,000. A gig could be, for example, one blog article, a custom-made logo, or 3D animation. Sellers can also offer three tiers with different prices (basic, standard, and premium) for each gig based on complexity.

Fiverr has one of the largest growing numbers of active users of all freelance marketplaces. As of 2021, it counts 4.1 million active users and 830,000 freelancers from approximately 160 countries. Most buyers (70%) come from only 5 countries: the United States, the UK, Canada, Australia, and New Zealand.

Signing up is free both for sellers and buyers and there are no main features behind a paywall. However, both buyers and sellers will be charged a fee for every transaction.

For sellers, there is a fixed fee of 20% over the gig amount. If the gig is $5, the seller will only get $4. If the gig is $100, they will only receive $80. And so on.

Additionally, there is a 5.5% service fee charged to buyers over the purchase amount. An extra $2 small order fee is applied to purchases under $50.

If you’re looking for a data analyst or a virtual assistant, your search may lead you to Fiverr or Pareto. Despite some overlap in solutions, there is more separating Fiverr and Pareto than uniting. They are not even mutually exclusive.

As we’ve seen, Fiverr is a platform that connects a pool of freelancers and clients in need. Buyers can find diverse services, that can range from website development, graphic design, translation, copywriting, or search engine optimization. The freelancers work independently from the platform and the deliverables are not quality-assured. Buyers rely on customer ratings as an indicator of quality.

Pareto, on the contrary, has a wide range of solutions tailored to growing businesses. Through high-quality lead generation, data collection, and high-volume research, Pareto supports startups in getting a headstart and moving faster toward their goals. Customers have a single point of contact (the Project Partners) who assures each project is delegated, QA’d, and delivered within the deadline.

The Pareto team is experienced in lead generation, candidate sourcing, data collection, and high-volume research, as well as in other supporting projects, such as outreach or data labeling. By doing these, Pareto supports businesses in performing competitor research, finetuning marketing strategies and processes, hiring valuable talent, carrying out startup fundraising, and finding ideal customers to outreach.

Having 4.1 million active users and 830,000 freelancers does not happen by chance. Fiverr has been serving buyers and sellers since 2010 and users report a significant improvement in quality since then.

For freelancers, Fiverr is a good opportunity to work on a variety of projects, diversify their portfolio, and work with different industries. It’s also great for beginners, being easy to navigate and with an intuitive interface. To get into the freelance world, you need experience. Fiverr offers freelancers the chance to get that experience.

For buyers, the main advantages are:

1. Finding freelancers with unique skills. The categories are endless: you’ll find graphic designers, translators, developers, copywriters, animators, lawyers, manufacturers… even tattoo artists, and astrologers. The sky is the limit. Fiverr is great for niche demands.
2. Intuitive interface. Getting started is easy and quick, navigation is intuitive and you can purchase gigs in a few clicks.
3. Cheaper than average. Sellers come from all around the world, including countries where the currency is worth less than the dollar. There are experience and price levels for every budget. When cutting costs is a priority, this opens the possibility to find below-market prices, even if it increases the risk of scams or low-quality work.
4. Different options for different budgets. Buyers are in complete control of who they hire. Buyers can choose from New Sellers, Level One Sellers, Level Two Sellers, Top Rated Sellers, and Pro Sellers.
5. Buyer protection. Despite there not being QA processes, buyers don’t have to pay for work that didn’t match the initial requirements.
6. Fast turnaround. Results in 24h are possible for an extra premium.

This all looks great so far, right?

Fast turnaround, lots of choices, and below-market prices make Fiverr seem like a no-brainer. As with anything that seems too good to be true, there are some risks associated. Before jumping on a gig-buying spree, consider these six reasons to stay away from Fiverr:

1. Poor quality. Many gigs are overpromising in the hopes of getting more income. You’ll be getting what you pay for and should keep reasonable expectations (it’s unlikely that a $5 gig will be top quality). For example, cheap backlinks and website traffic services may come from low-quality sources and harm your website.
2. Time-consuming browsing. If you search for a new logo design, there are 231,094 gigs to sort through. Even with intuitive search features, finding the right freelancer for your needs is burdensome and time-consuming.
3. Scams. Even with the buyer protection clause, there are always people trying to weasel new ways of scamming. Website traffic increases from bots, plagiarized content, or fake reviews are some unconventional ways to scam found by sellers.
4. Inactive users. When you buy a gig, you’re risking receiving no response from the seller. While the platform reimburses gigs that are inactive for more than a week, you’re still left with no results and back to browsing seller profiles.
5. Legal implications. With low prices comes the risk of low-quality results, which could lead to copyright infringements. This could happen, for instance, when you get graphic content with unclear copyright. Or if you unintentionally purchase and post plagiarized content. As the buyer, you may be the one who is sued or prosecuted for the breach.
6. Language barriers. Fiverr freelancers come from at least 160 countries, the majority not being native English speakers. Buyers have reported communication difficulties and misunderstanding the project instructions. For gigs with written or spoken tasks, language barriers could also negatively impact the quality of the work.

The downsides are not limited to buyers. Freelancers denounce having to do a lot of work for little pay until they build their platforms. There are 4 main reasons for this to be the case:

1. Fierce competition leads to underselling. Especially for the most common gig types, the competition is fierce and freelancers need to lower their prices to get any business. For example, a seasoned writer reported taking $2/hour to make the first sale.
2. Freelancer school mentality. Often freelance marketplaces adhere to the mentality of “doing things as cheap as possible to take off”. Through this lens, freelancing is more a hobby than a job that earns a living wage.
3. No consistency. Freelancers report difficulty in getting constant revenue streams until they collect good reviews.
4. Can’t build clientele. All communication has to go through the platform and giving out personal contact information is strictly forbidden. This leaves freelancers fully dependent on the platform and vulnerable to any changes.

Fiverr’s support of freelancers is limited. On occasion, they've been under scrutiny for promoting overworking and unhealthy working patterns. The 2017 ad that read “You eat a coffee for lunch. You follow through on your follow through. Sleep deprivation is your drug of choice” speaks for itself.

Overall, the upsides and downsides have to be weighed before declaring Fiverr the righteous solution for your every need. In the next section, we’ll look at how Pareto compares to Fiverr in scope, specialization, and business philosophy.

Depending on the type of task, goals to achieve, timeline, and necessary expertise, you may be looking at Fiverr as the best option. If you’re looking for one-off creative work, for example, a new brand identity design or SEO copywriting, hiring a well-reviewed seller on Fiverr could be your best option.

As we’ve highlighted, Pareto is not a freelancer marketplace like Fiverr. Pareto’s solutions are focused on those highly valuable but time-consuming repeatable tasks that startups need to grow. With Pareto, customers get targeted leads to grow their customer base, lists with potential partners, information on their competitors, candidate lists for their open roles, and much more. Pareto’s range of services is not as wide and all-encompassing but it is more specialized and tailored to startups and growing businesses.

With Pareto, customers don’t have to endure time-consuming vetting processes. As an extended team, we cultivate a highly dependable team who works with the customer to bring their next business goals to life.

Beyond that, all Pareto projects are quality assured. Customers never have to worry about low-quality outputs or waste time quality-checking the results. If the deliverables do not match the initial criteria, they will be replaced or refunded at no extra cost. Customers never run the risk of paying for low-quality work.

With the post-pandemic rise in freelance work, Fiverr offers an intuitive platform for freelancers to build their portfolios, showcase their expertise, connect with potential clients, and generally get started in their industry.

However, freelance marketplaces are oversaturated, which leads to job insecurity and the inability to secure a living wage for many workers. In this highly competitive and unregulated market, freelancers also typically have fewer training opportunities. Having to take upskilling into their own hands, independent workers could be stuck doing the same tasks over and over again and not benefiting from career progression.

Fiverr has, on multiple occasions, been criticized for promoting overworking and unhealthy working patterns. Controversial ad campaigns conflate working at Fiverr and sleep deprivation and glorify hustle culture, symptomatic of the unhealthy expectations placed on freelancers. No work-life balance, burnout, and health deprioritization are some of the sins of the gig economy’s rhetoric.

Pareto is changing the outsourcing paradigm from the inside out. On a mission to empower work-at-home moms and talented women, Pareto directly impacts the professional and personal goals of team members and addresses industry inequalities hands-on. Through remote flexible jobs, quality training, community building, and goal tracking, there is no stagnation on the Pareto team and everyone’s voices are heard in the workplace.

Building a truly supportive working environment goes way beyond who gets the job opportunity. Anyone that is welcomed into the Pareto team is encouraged to step outside their comfort zone, build new skills, and try different roles. Our team of data experts is more than a group of contractors. Together, we are creating meaningful work by employing working moms, providing technical training, and encouraging leadership at all levels.