Israel-based Stoke raised USD $4.5 Million for what is essentially a vendor management system (VMS) for freelancers. The app helps employers with the management, payment, and onboarding of freelancers. Companies will still rely on talent marketplaces or agencies to identify freelancers and provide any vetting of skills or credentials. Freelancer hiring decisions are made outside of Stoke. Stoke provides a centralized system that aims to standardize contracts, payments, and onboarding for freelancers.
Stoke’s hypothesis is that the system will be used by line managers hiring freelancers outside of any HR or procurement process. This differentiates it from traditional VMS systems, which usually sit in the procurement department. It also represents another piece of HR technology that isn’t a part of the ecosystem today, and a functionality set that is being worked on by existing VMS systems, talent and HR platforms, ERP vendors, etc.
As we’ve studied the emergence of the contingent workforce, we don’t see “freelancer management” sitting alone, but being integrated into the overall talent processes that are currently on a path to account for freelancers and contingent workers. We expect Stoke to find early success with employers/departments that are hiring a large number of freelancers and feeling pains around compliance and administration, however they’ll start to run into stiff competition with vendors currently providing freelance talent or core HR capabilities like payroll and workforce planning.