- What is Thumbtack, and how does Thumbtack work?
- How does Thumbtack make money?
- Charging Contractors For Leads (Credit Packs)
- Subscription Revenue (Thumbtack Plus)
- Thumbtack Subsidiaries, Acquisitions, and Exits
- Thumbtack profit and revenue
- What is the Thumbtack business and revenue model?
- Thumbtack funding and valuation
How does Thumbtack make money if they don’t charge fees or commissions? Here is a full, in depth, breakdown of their two (2) revenue streams and the different products and services they offer, as well as the Thumbtack business model, their profit and revenue, and how Thumbtack works.
What is Thumbtack, and how does Thumbtack work?
Thumbtack is a gig economy marketplace that allows users to search for and hire local contractors for jobs such as home improvement, financial and legal services, and more.
Founded in 2008 by Marco Zappacosta, Jeremy Tunnell, Jonathan Swanson, and Sander Daniels, Thumbtack has since grown to more than 200,000 contractors on its platform that completed over 70 million jobs for customers since its founding.
How does Thumbtack work? To use Thumbtack, both customers and contractors must first create an account by downloading the mobile app on the Apple Store or Google Play; or by visiting their website.
Once an account is created, customers can simply search for the type of work they need to be done, browse profiles, read their reviews, and reach out to talk about the project with them. Once a customer has found the right pro, they can book them for the project right through the app.
As for contractors, they can get started by first creating a pro account and filling out all the necessary info that will land them jobs on the platform such as entering their business information, experience, references, availability, etc. Once all of that is set up, contractors can begin looking for work by purchasing lead generation credits, submitting for jobs, and receiving proposals.
How does Thumbtack make money?
According to Thumbtack, Thumbtack contractors have received more than 8 million job requests which led to more than 4.5 million customers in the last year.
So how does Thumbtack make money off of all those leads and customers?
Below is a breakdown of how much money Thumbtack makes and its revenue model. Including all revenue streams and how much they charge for their services.
Here are the 2 ways of how Thumbtack makes money (in 2022):
Thumbtack has a revenue model that makes money in two (2) ways; charging contractors for leads and subscription revenue from customers.
#1. Charging Contractors For Leads (Credit Packs)
Thumbtack makes the majority of its money from its contractors paying them for leads.
How does Thumbtack make money from leads? Thumbtack makes money by charging its contractors to purchase “credit packs” upfront using the linked card on their account. These credits are then used by the contractors to find leads.
Every time a Thumbtack customer sees an offer from a Thumbtack contractor and responds, they get charged 1 credit. 1 lead = 1 credit = $1.50 per credit.
As noted above, Thumbtack had more than 4.5 million customers in the past year alone. Most of them were connected through a lead, and Thumbtack gets paid for each one of those leads, up front. You can see how much a lead costs below.
Thumbtack Lead Cost:
- $1.50 per credit, or less depending on how many are purchased in bulk
Note: Unlike most gig economy business models, Thumbtack does not take a commission from the gig total, of either party.
#2. Subscription Revenue (Thumbtack Plus)
Thumbtack also makes money through subscription revenue with Thumbtack Plus for its customers.
For a yearly fee of $49 per year, members get perks such as 20% off on-demand bookings, expert support from home specialists, and a $10,000 money back guarantee if a customer’s project wasn’t finished as expected (compared to the $1,000 for non-members).
- $49 per year
Thumbtack Subsidiaries, Acquisitions, and Exits
To date, Thumbtack, Inc. has made a total of 2 acquisitions.
Thumbtack profit and revenue
Thumbtack has not released any official reports in regards to company earnings.
Note: Because Thumbtack, Inc. is a privately held company, they are not required to make their annual reporting, such as Form 10-K’s, pubic.
What is the Thumbtack business and revenue model?
Thumbtack makes money through a few revenue models that they combine within their company, they are:
- Fee for service (FFS) business model
- Subscription business model
- B2B2C (partnerships) business model
- Mergers & acquisitions (M&A) business model
Thumbtack funding and valuation
According to Thumbtack’s Crunchbase profile, Thumbtack has raised $698.2 million over 8 rounds and has a post-money valuation of $1 billion to $10 billion as of June 15, 2021.