Local Marketplace Thumback Raises $4.5M

Thumback, last seen on this blog exposing price inflation on daily deal sites, announced that it has raised $4.5 million in Series A financing. The site is a local services marketplace most directly like RedBeacon. However it competes with everyone in the local space that caters to service businesses.

Thumbtack has been around since 2009 and grown slowly and steadily. The company says that there are now 240,000 merchants on Thumbtack and that the site is generating $40 million in annual revenue to local businesses.

Thumbtack makes money by charging a flat fee or a commission at the election of the merchant:

We give you two options for compensating us for the public requests we send you. On each job, you choose the Fixed Payment option or the Commission Payment option. If you choose the Fixed Payment option, you pay once to respond to the lead and pay nothing more. If you choose the Commission Payment option, you’ll pay us later based the amount you collect from the customer.

On one level this could be described as “lead-gen,” which has been around since the early days of the Internet. However sites like Thumbtack, RedBeacon and others (incl. daily deals) represent a movement away from local “advertising” and toward “transactions,” where risk to the merchant is minimized.

This is a narrower relative of the “eMarketplace” model that UK publisher Yell is aiming toward.

You can follow any responses to this entry through the comments feed.

4 Responses to “Local Marketplace Thumback Raises $4.5M”

  1. Electrician says at

    Congratulations to Thumbtack!

    This is great news for all of the services marketplaces around the world. The last year has seen amazing progress and an absolute trend away from traditional directories and towards services marketplaces.

    The last year alone has not only seen Thumbtack raise $4.5m, but also RedBeacon raise over $7m, Sensis buy Quotify for $6m, Pages Jaune buy Kel Travo,  Zaarly enter the market with the help of Meg Whitman (formerly of eBay), Task Rabbit as well.

    This space is moving very quickly, and publishers that don’t act quickly to catch up will run the risk of being left well behind.

  2. Greg Sterling says at

    I agree these marketplaces, if they reach a certain level of scale, will be very disruptive. 

  3. Electrician says at

    Better watch the bait and switch with these guys mostly red beacon.They will charge you 25% commision when 10% is stated all over the web.They say a small fee 25% is not a small fee

  4. Greg Sterling says at

    Are you saying they misrepresent their fees/prices?

  5. HomeDepot Buys RedBeacon says at

    […] RedBeacon competitor Thumbtack just announced a $4.5 million funding round. […]

Leave a Reply