Fiverr International (FVRR), one of the most popular online marketplaces for freelance services, has acquired CreativeLive to expand its online learning platform, Fiverr Learn.
Fiverr serves freelancers and businesses in over 500 categories across nine verticals, including Graphic Design, Digital Marketing, Programming, Video, and Animation. The company is expanding into Online Education and Training Services, as the ability to learn new skills in a changing work environment has become increasingly important.
The company benefited substantially from the expansion of the gig economy during the pandemic, which is an industry that is expected to reach $455.2 billion by 2023. Fiverr has established itself as a top platform in this market, and is well-positioned to prosper as it expands its operations into career development and other educational services.
I am bullish on Fiverr because of the favorable macroeconomic environment facing the gig economy. (See Analysts’ Top Stocks on TipRanks)
Expanding Beyond Core Services
On October 7, Fiverr announced that it is acquiring the online learning platform CreativeLive. Chase Jarvis founded CreativeLive, a Seattle-based entrepreneurial learning platform, in 2010.
The e-learning platform offers a variety of live and pre-recorded courses in video, photography, design, business, marketing, and more. The courses are taught by a diverse set of instructors, including Pulitzer, Grammy, and Oscar winners, New York Times best-selling authors, thought leaders, and renowned entrepreneurs.
It currently offers over 2,000 classes in several creative and business categories, and claims to have assisted 10 million learners in acquiring new skills for professional or personal improvement in all these areas.
Fiverr currently offers an educational content service called Fiverr Learn. This will be incorporated into CreativeLive to expand the number of courses available to better meet the needs of businesses and freelancers globally.
The acquisition will offer both companies a competitive advantage to excel in their respective domains. Additionally, CreativeLive will be able to take advantage of Fiverr’s resources, allowing it to better target freelancers that are looking to enhance their talent.
CreativeLive will continue to operate as a separate entity under Fiverr, with founder Chase Jarvis continuing to lead the staff of 25 employees at its present location in Seattle.
CreativeLive’s industry experience in building captivating learning experiences is a perfect addition to Fiverr as the company scales its online education platform to assist the Fiverr community.
Fiverr Playing its Cards Right
With the rise of the gig economy, e-learning platforms have seen a surge in enrollment as freelancers seek to improve the quality of their services by enrolling in online courses.
In addition, as more people prefer independent work contracts, competition is increasing. This requires freelancers to keep their skills and knowledge updated in a changing market to stay ahead of their competitors.
The e-learning industry has been further boosted by the closure of schools and institutions around the world owing to the pandemic. This has offered growth opportunities for online education and training providers.
According to Global Market Insights, the e-learning market exceeded $250 billion in value in 2020. In addition, it is expected to grow at a compound annual growth rate of over 21% through 2027, owing to a few factors. These factors are: AI-enabled e-learning solutions that will aid in the development of smart content, digital study guides, and real-time questioning.
Given this background, it makes sense for Fiverr to aggressively expand into the e-learning industry, which is exactly what the company is doing with its acquisition of CreativeLive.
Wall Street’s Take
Based on the consensus rating of four Wall Street analysts offering 12-month price targets, the average Fiverr price target is $220.50, which implies 15.1% upside.
Fiverr stock price dropped sharply following the release of second-quarter earnings, which perhaps offers a good opportunity for contrarian investors to consider investing in this high-growth company.
Takeaway
Fiverr continues to invest in its platform to expand beyond its core services. This is a very encouraging sign, as the company is unlocking many new opportunities to grow with its expansion efforts.
The acquisition of CreativeLive is a step toward achieving the company’s objective of becoming a leading career platform, and Fiverr is likely to reap the benefits of this acquisition in the long run.
At the time of publication, Dilantha De Silva did not have a position in any of the securities mentioned in this article.
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