Fiverr (FVRR) FY Conference Transcript

Summary of Fiverr (FVRR) FY Conference Call - May 13, 2025 Company Overview - Fiverr is a global marketplace connecting freelancers and businesses through digital services across more than 700 categories, including graphic design, copywriting, voice-over, music, and AI services [1][2]. Market Potential - The total addressable market (TAM) for freelancing in the U.S. is estimated at approximately $250 billion, with significant international expansion potential [4]. - Awareness of the efficiency of digital marketplaces is growing, as traditional methods of finding freelancers remain fragmented and outdated [5][6]. Strategic Focus - Fiverr has shifted its focus from micro services to engaging larger customers with complex needs, resulting in transactions ranging from tens to hundreds of thousands of dollars [7]. - The company aims to enhance its margins by expanding its Fiverr Pro offering and targeting mid-market to enterprise customers [8][9]. Product Development and AI Integration - Fiverr is evolving from a marketplace to a platform, offering a suite of tools for project management and engagement with talent [9][10]. - The introduction of AI tools aims to improve customer experience and streamline the search and engagement process within the marketplace [15][18]. - Fiverr Go, a new product, serves as a personalized AI assistant for creators, significantly improving conversion rates and customer interactions [33][34]. Financial Performance and Growth - Fiverr has seen strong growth in service revenue, driven by seller tools, promoted leads, and app integrations [45][46]. - The company expects seller plus revenue to contribute approximately 30% of overall revenue in the current year [48]. - Revenue growth outlook for 2025 is projected at 10%, with potential for double-digit growth as macroeconomic conditions improve [49][50]. Profitability and Expense Management - Fiverr maintains a disciplined approach to managing expenses while improving EBITDA, with a long-term target of 25% net margin by 2027 [53][55]. - The company is focused on optimizing marketing spend and increasing lifetime value for customers [54]. Market Sentiment and SMB Focus - The sentiment in the small and medium-sized business (SMB) sector is currently negative, impacting growth, but Fiverr believes that as market conditions improve, SMBs will invest more in their growth [40][41]. - The average spend for SMBs is approximately $15,000 per year, indicating significant room for growth in both spend and active buyers [51]. Future Outlook - Fiverr's leadership emphasizes the importance of adapting to changing market dynamics and leveraging AI to enhance the marketplace experience [36][37]. - The company is optimistic about the future, believing that the evolution of work and the integration of AI will create new opportunities for entrepreneurs and businesses [60][61]. Additional Insights - The CEO's candid communication about the impact of AI on jobs highlights the need for professionals to adapt and leverage technology to remain relevant [20][21][22]. - Fiverr's approach to AI aims to empower creators rather than replace them, fostering a collaborative environment for innovation [31][32].