Why we believe gig work is real work.
Written by Laura Lenz, Partner, OMERS Ventures
Today we announced our USD$5M funding round in Moves, an all-in-one banking app for gig workers.
We have all experienced the important contribution that gig workers make to both our daily needs and life’s little pleasures. No time more so than during the pandemic, when many of us didn’t leave our homes except to buy necessities. Many of us have come to rely on gig workers to fulfill our basic errands and needs. And while we’ve come to depend on these workers and interact with them many days of the week, do we really know them?
Let me paint you the picture of what I’ve learned a typical gig worker looks like. Gig workers are very entrepreneurial people who come from all walks of life, including immigrants, blue collar workers, students and others seeking independence in their work. These workers strongly value the flexibility and variety of jobs that comes with gig work and the ability to directly impact their pay based on the number of hours they work. Gig workers often are supplementing their current income, but more and more are choosing gig work as a full-time source of income. Over the past decade, 68% of new independent contractors are millennials and Gen Z (source: MBO Partners). This highlights the fact that the majority of the emerging workforce is seeing independent contract and gig-economy work as a viable means of income. This is a trend that we expect to accelerate as technology continues to make independent work more viable and worker experience improves.
Many workers, based on their entrepreneurial spirit and desire to supplement their income, typically work for 2 to 4 different gig-platforms. Herein lies the problem. The apps, generally fiercely competitive, don’t integrate or communicate with each other and so gig workers can’t consolidate their work streams, cash flow, or effectively plan for the future.
The contrast between gig workers and traditional workers is telling. According to MBO Partners, 74% of traditional workers have regular income compared to 32% of gig workers. And while 55% of traditional workers are provided benefits, 0% of gig workers are provided those same benefits. To illustrate some of the financial pressure on the gig worker and full-time salaried employee, Business Insider recently highlighted that 63% of freelancers dip into their savings at least once a month, compared to 20% for the salaried employee group.
In addition to the financial challenges experienced by gig workers, their status as independent contractors also means they are not eligible for benefits (i.e. health insurance, life insurance, vacation, pension contributions, etc). To avoid their workers being perceived as employees, gig platforms have historically been unwilling to provide these benefits to maintain an arm’s length relationship with workers. Gig workers are also generally unable to benefit from any organized labour efforts. The current financial system just doesn’t work for the gig worker. This is the core problem that Moves is solving.
By being 100% focused on being the voice of the gig worker and providing products that cater to the specific needs of this market, the Moves team is positioning itself to capitalize on the massive, growing opportunity in a currently under-represented market. Moves is building products uniquely for the gig worker. Allowing them to be the entrepreneurs they want to be, in the most efficient and financially secure way possible.
Over the last year, Moves has launched financial products for gig workers. Moves started with cross-platform earnings insights that enable gig workers to see their earnings across multiple gig-platforms. The company then launched a spending account, a Visa Business debit card, and a cash advance product enabling gig workers to advance up to $1,000 of their earned income. This was quickly followed by the Moves Collective, which gives all gig-workers the opportunity to participate in earning stock in the publicly-traded gig platforms that they work for, incrementally growing gig-worker ownership of an industry that wouldn’t exist without them. Since its founding, Moves has built its products in partnership with gig workers, focusing exclusively on their needs, and the company will continue to launch products based on this partnership.
The purpose and drive of the Moves founding team is second-to-none. We are confident that with their combined knowledge, dedication to the cause, and relentless drive to succeed, this team is well positioned to win. We are grateful to be able to join them on this journey. And remember, gig work is real work.