Company is on an $80M+ Revenue Run Rate by Fixing a Broken Talent Marketplace Model with a Service that Pre-screens and Custom Matches Proven Engineers to a Client’s Team and Project.
SAN FRANCISCO – April 30, 2015 – Toptal, the network for elite freelance software engineers, announced today that it is delivering the top three percent of developers worldwide to help companies address the shortage of local talent they need to innovate and compete. The company is the first to rigorously screen applicants and custom match its engineers according to each client’s unique project and team requirements. By thoroughly vetting the quality of its talent network, Toptal is able to confidently offer a 100 percent risk-free trial period for each new engagement. This has enabled it to gain considerable traction with companies in segments such as financial services, aerospace, consulting and high tech.
“As seen from experience as a client, Toptal’s service is an enormous leap forward from existing sites that lack a reliable process to identify and supply the quality software engineers that are in such high demand,” said Ryan Rockefeller, an early investor. “Whereas other sites are focused on filling one-off hires, Toptal is finding and matching the best developers to strategic programs. And by giving this now global network of top talent access to quality projects at professional rates, Toptal has built a self-propagating community in which both the engineers and the clients are thriving.”
Toptal’s approach contrasts sharply with open talent marketplaces such as oDesk and Elance that often leave companies dealing with hundreds of project bids and applicants with no guarantee of quality or team fit. Its unique model gives companies the freedom to rapidly build or augment project teams without the risks of making a bad hire.
According to the U.S. Department of Labor, the unemployment rate of software engineers is just 2.6 percent, less than half the rate of 5.5 percent, the number considered by many to be full employment. As a result of this drastic shortage of talented engineers, companies in the United States and other developed economies face fierce competition when hiring for their most important projects. According to a 2012 McKinsey study, large software projects run, on average, 66 percent over budget and 33 percent over schedule. Of note, the inability to secure critical internal and external talent is associated with nearly half of all cost overruns.
“As companies seek to become the next Google or Facebook, they’re using Toptal as a secret weapon to develop products and get to market faster. We see ourselves as the Uber for world-class software talent, and take a tremendous amount of pride in our role at every client company—whether we make up their entire development team or augment their core team’s capabilities,” said Taso Du Val, co-founder and CEO at Toptal. “On the flip side, it’s extremely rewarding to see the growth of Toptal’s flourishing developer community. Since January alone, it has hosted nearly 100 local meetups, technical conferences, and other events across the world in places as diverse as Argentina and Croatia - all driven by engineers.”
Toptal has built a thriving, global community of senior engineers by focusing on the best. There are ‘Toptalers’ from MIT, CERN and Google, as well as Top 100 Rails contributors, Django committers, authors and professors. Employing a rigorous screening process where senior Toptal engineers assess every new applicant, the company vets language and personality, computer science fundamentals, advanced technical knowledge, and the ability to thrive as a member of the Toptal network. On average, the company accepts only three percent from the thousands of applications it sees each month, making the Toptal community more selective than Harvard University or the U.S. Navy Seals. For Toptal developers, the service is compelling since it allows them to choose from challenging projects at leading companies, set their own schedules while working from any location, and be compensated competitively for the value they provide. The result is an exclusive, tightly-knit community of developers with a unique lifestyle embracing the freedom and flexibility of working remotely as trusted professionals.
Anna Chiara Bellini, previously a researcher in the computer science department at the University of Bologna, and now a full-time Toptal engineer, explains, “Toptal has given me access to clients and challenges that I could not have found otherwise. The competitive rates and flexibility to work remotely allow me to create the perfect lifestyle where I travel frequently, speak at technical conferences, and constantly interact with top people.”
Two important elements highlight the nature of the relationship that Toptal has with its clients. With an average engagement size of approximately $40,000, Toptal projects are more than 10 times the size of many competitors. Also of note, open talent marketplaces serve a large range of projects, including simple websites or hobby projects; Toptal focuses on clients with serious, intriguing engagements. By also vetting clients, Toptal strives to ensure that every engagement between a Toptal client and a Toptal engineer will be a meaningful success.
In 2014, Toptal achieved 189 percent revenue growth, and is on an $80 million plus run rate for 2015. Currently, Toptal’s network comprises thousands of developers and more than 2,000 clients. The company has enjoyed success in the SMB market and is seeing increased traction in the enterprise segment. Large Toptal clients include J.P. Morgan, Axel Springer, IDEO, Pfizer and Rand McNally. It has also worked with high-growth companies such as Airbnb, Artsy, FundedByMe and Zendesk. The company’s current investors include Andreessen Horowitz, Adam D’Angelo of Quora, Dave Hersh of Jive and Ryan Rockefeller.
“We approached Toptal over a year ago with a request for immediate help on developing the back-end of our real estate investment platform,” said Jason Kulik, senior partner at ProHatch. “We were impressed right away, and what began as a part-time engagement quickly turned full-time to where he is now our team’s lead developer. His ability to understand complex concepts and our company’s vision beyond the scope of technology has greatly contributed to our success. For me, this speaks volumes to the quality of professional talent that Toptal provides and is able to match in their screening process.”
“We asked for Toptal’s help to enhance a key feature on our digital Rand McNally World Atlas, an interactive mapping tool for students and teachers. Our Toptal developer did a great job in designing and building out a new implementation that is now a part of the product,” said Ryan Walker, director of product management, Rand McNally. “Bottom line, Toptal’s model gives us quality and reliability. And while the hourly rates are slightly higher, it ends up being worth it because projects take less time. The time it took Toptal’s engineer to understand and accomplish what we were trying to do was much less than it would have been with other options.”
“Toptal saves me time. And time is the most important currency that a startup has,” said Shariq Minhas, chief technology officer at Stayful. “Stayful initially engaged with Toptal to help build a marketplace to connect travelers to unique boutique hotels. We’ve worked with four developers and have had really good success with all of them. One has been with us for over a year now. The reason Toptal’s developers integrate really well is their pre-screening and matching process.”
“The recent briefing from Toptal was one of the most interesting I’ve received in some time,” said Madeline Laurano, vice president of Talent Acquisition Practice and principal analyst at Brandon Hall Group. “They understand the strong growth of contingent workforces and are fueling this trend with a unique service for businesses that focuses on providing pre-screened engineers that are matched to each client’s requirements.”
“Toptal’s approach to supplying freelance engineers is different than existing marketplace models,” said Lisa Rowan, research vice president, HR and Talent Management Services at IDC. “Given the increased time pressures on businesses, many will respond favorably to a service that is focused on the quality and fit of the developer and removing project risk for clients. It will also be interesting to watch the growth of their community, given the company’s focus on providing them with more in-depth projects and commensurate pay.”
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Toptal is one of the most innovative and rapidly expanding tech start-ups from Silicon Valley. With backing from Andreessen Horowitz and Adam D’Angelo, its platform is the fastest growing labor marketplace in the history of the Internet – connecting thousands of elite engineers all over the world. In the last four years, Toptal has become the #1 choice for tech companies requiring top-tier engineering talent and for the top 3% of freelancers looking for their next challenge.
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