How Upwork Makes Money

For those just starting out on the platform, it’s important to understand how Upwork generates income. This company primarily makes money through various types of fees from freelancers and clients and operates with a fee-based business model. Below are the key ways in which Upwork earns money:

Fees From Freelancers

• Service Fees: Upwork charges a sliding fee based on the freelancer’s lifetime billings with a specific client. This fee ranges from 5% to 20% of the freelancer’s earnings.
• Connects Cost: Freelancers must use ‘Connects’ to submit proposals for jobs. These ‘Connects’ are not free and must be purchased by the freelancer.

Fees From Clients

• Payment Processing Fees: A flat 3% processing fee is charged to clients when they make any payment to freelancers.
• Job Posting Fees: Upwork also offers premium job listings where clients can pay to have their job postings appear more prominently.

Freelancer’s Paid Features

Upwork offers a premium ‘Freelancer Plus’ plan that comes at a monthly cost. This plan provides advantages like more ‘connects’ per month, the ability to see the high, low and average bids on jobs, and the opportunity to keep your earnings confidential.

In Conclusion

It’s important to understand that while Upwork is a platform that makes it possible to find work as a freelancer, it operates as a business and has a model in place to generate revenue. It’s a good idea to familiarize yourself with these fees before you start working to minimize unexpected costs.