In my last update I shared we made the difficult but necessary decision to lay off 40% of the Freelance Labs staff (~28 FTEs), institute a 10% pay cut across the board, and pause all paid marketing initiatives in order to adjust to the macro-economic climate. The playbook here is simple: cut costs, raise prices, invest in automation/scalability.
Price increase:
The Braintrust Community voted and overwhelmingly passed a proposal to increase the client fees from 10% to 15%, which means the network will have 50% more revenue from every client that comes in. Our closest competitors charge far more than this (50-150%) so there is plenty of head room left and should not affect demand.
These changes ensure we will have “infinite runway” and can survive (and grow) through this downturn. We anticipate the network to process $90-$100m of GSV in FY2023.
Core Teams Update:
- The anticipated impact of the cost cutting measures is that the core teams are leaner, more aligned, and shipping faster.
- We’re implementing internal AI/LLMs across the organization:
- Automated matching of candidates to jobs is improving by 20-30% with each release (roughly monthly).
- Automated screening of talent is continuing on the path to full automation / better quality.
- Automated moderation / post tagging on the Professional Network.
- Customer service: one person overseeing an AI system
- Finance: one person overseeing an AI system (being built)
- There are now only ~40 people working across the 5 core teams and we anticipate we can grow GSV to $1B annually without crossing 50 full time people. This is due to the token referral engine working beautifully + increased usage of AI on both the application and internal network operations.
- I spoke to Christopher Mims at The Wall Street Journal for an article entitled: What Will AI Do to Your Job? Take a Look at What It’s Already Doing to Coders. The article highlights Braintrust as an incredibly capital-efficient business that can meaningfully scale revenue without also linearly scaling opex/headcount. We’d appreciate it if you could share in your networks - helps build the brand.
Client Side:
While the global macro environment continues to be challenging to the demand side of Braintrurst, we are seeing bright spots:
- New clients continue to pace high (51 new) for 2nd month in a row (2x the 6mo avg.)
- Added 9 new enterprise clients in June (most in 13 months)
- Active clients continue to pace high (101 active) for 2nd month in a row (127% of 6mo avg.)
- Partnership channels continue to grow (47 Client leads in June)
- Expanded one of our earliest clients, Nestle, to begin using Braintrust to hire full time talent.
- Challenge: lead volume is down 46% MoM - partially seasonality + macro conditions.
Talent Side:
- We have nearly 400,000 talent members around the globe coming to Braintrust not only to earn, but to learn and grow in their career via The Professional Network.
- The Professional Network has been live to the public for about a month and has more than 10x’d the weekly active user (WAU) goal of 750 with a median of 7738 since launch.
- Posts and post engagement (answers) are also exceeding expectations and we’re seeing early green-shoots of viral engagement loops working well.
- All signs indicate that this will be an incredibly scalable, zero-CAC way of growing the talent side of the marketplace.
- Q3 will see us introduce using BTRST tokens as a value exchange substrate for more in-depth career advice and mentorship.
- We’re also building/training an internal LLM which will eventually power a bot for lower-fidelity career advice.
- Virtual talent events are also moving the needle for us in a very-low-cost way. In July we hosted a virtual event with over 3,000 RSVP’s.
Grateful as always for your support. If you have any questions or comments, please don't hesitate to reach out.
All the best,
Adam
@adamjacksonsf
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