Summary

In a recent episode of the Human Cloud Network Monthly series, industry leaders convened to discuss the profound shifts shaping the future of work, with a central focus on consolidation, technological integration, and the evolving role of flexible talent. The panel, moderated by our CEO Matthew Mottola, featured experts Brad Collins, an M&A expert; Sandeep Dhillon, a pioneer in the freelance consulting space; Jeff Mike, a human capital and contingent workforce specialist; and Preston Mossman, a leader in AI and digital transformation. The discussion provided a comprehensive overview of a market in flux, offering strategic insights for organizations and individual entrepreneurs navigating this new landscape.

Key Market Dynamics and Strategic Acquisitions

The session began with an update on recent developments in the flexible talent ecosystem, highlighting a period of intense consolidation. Mottola kicked off the discussion by congratulating the network on several recent achievements, including two significant acquisitions: the purchase of freelance management systems (FMS) and employer of record (EOR) providers by Upwork, and another by Workday. Other notable developments included the launch of a new AI skills intelligence agent by Gigged.AI, the introduction of crypto payment options for freelancers by Supportwave, and a new partnership between Human Cloud and Beeline, which Mottola hailed as a major milestone.

The conversation then turned to the financial implications of these acquisitions, with Brad Collins providing an expert analysis of Upwork’s strategy. Collins noted that while Upwork’s Gross Services Volume (GSV) had remained flat since 2022, its profitability had increased significantly due to a rise in monetization and take rates. He explained that Upwork’s acquisitions of Bubty and Ascen were a strategic move to reignite GSV growth by expanding its platform beyond its traditional marketplace. These acquisitions, he argued, provide a much-needed boost to Upwork’s enterprise offerings by giving them a full, owned system and infrastructure for FMS and EOR services.

Collins also offered a fascinating look into the M&A process itself, describing how Upwork had used a “reverse auction” method—akin to an RFP for acquisitions. By reaching out to over a hundred potential targets with specific criteria, Upwork was able to identify which companies were not only a good fit but also willing to engage in a transaction at the right price. This approach proved highly effective in a market with a deep pool of smaller, capable companies. This method of acquisition is particularly effective in an era where the market is maturing and there are a lot of small-to-medium-sized players with different specializations and markets.

The Consulting and Freelance Talent Evolution

Sandeep Dhillon, former CEO of Talmix, offered a historical and forward-looking view of the consulting and professional services market for freelancers. He recalled the early days of his company, which began by serving small-to-medium-sized businesses with one-off projects. Dhillon explained that to become a more sustainable and profitable business, they had to pivot towards a high-value, recurring revenue model by focusing on larger clients: consulting firms, private equity operating teams, and large enterprises.

Ten years ago, he noted, these client segments were at different stages of adoption. Private equity firms were early adopters of independent consultants, while traditional consulting firms were just beginning to explore ways to become leaner. Enterprises, however, were still heavily reliant on large consulting firms and were the slowest to adopt independent talent.

Today, Dhillon sees a “perfect storm” driving the growth of freelance consulting. He identified two major shifts:

• Procurement and Risk Mitigation: Enterprise procurement and contingent workforce leaders are realizing the massive amount of “rogue spend” happening on small consulting projects that fall outside of official programs. These projects, often handled by various non-vetted suppliers, create significant compliance and risk issues, especially concerning worker classification. There is now a strong push to bring this spending under control.
• MSPs and Revenue Growth: Managed Service Providers (MSPs), facing stalling revenue from their traditional services, are actively seeking new areas of growth. They see a massive opportunity in managing the consulting and skilled workforce spend, which has historically been fragmented.

Dhillon also highlighted the demographic shift of talent entering the market, with a lot more former enterprise and consulting professionals choosing to go freelance earlier in their careers. This creates a much deeper talent pool for companies to tap into. He cautioned, however, that cultural and regulatory factors still play a significant role in flexible talent adoption, citing regions like the Nordics, Japan, and India where traditional employment models remain deeply ingrained. Despite these challenges, he concluded that the overall trend is overwhelmingly positive, with AI acting as a further accelerator. He also noted that while AI is driving growth, there is still a scarcity of experienced talent with both consulting and AI expertise, a key opportunity for companies that can identify and develop those skills.

The Convergence of HR and the Extended Workforce

Jeff Mike contributed a perspective from the world of human capital and analytics, focusing on a major theme of convergence. He asserted that the separation between managing a traditional full-time workforce and a contingent one is rapidly eroding. Organizations are no longer just looking at availability or speed when they need a resource; they are now performing a more holistic analysis of the “total cost of labor.”

Mike explained that businesses are starting to ask a fundamental question: “For a given business outcome, should we achieve it with a full-time hire or a flexible, contingent worker?” This requires a much more sophisticated analysis of not just the direct cost of labor, but also the costs associated with recruiting, onboarding, and upskilling talent. He noted that this trend is driving a convergence around analytics, with a focus on what he calls the “return for labor.”

He also touched on the continued disaggregation of traditional jobs into skills and tasks, a trend that is being accelerated by AI and digital agents. In this environment, a more strategic and analytical approach is needed to figure out what you are truly getting in return for what you are spending on labor. This shift requires HR and business leaders to move beyond buzzwords and traditional metrics to understand the true value being created by their entire workforce, whether they are full-time employees or gig workers.

Successful AI Adoption: Starting Small and Building Intuition

Preston Mossman, with his background in leading AI and flexible talent initiatives at a large enterprise, provided a practical, ground-level view of what works and what doesn’t. He shared an insightful anecdote about how his team at Koch began their flexible talent journey: by using a P-Card to hire a developer on Upwork for a small project. This small, “renegade” initiative became a proof of concept that eventually led to a much larger, internal flexible talent program.

Mossman’s central argument was that successful AI and flexible talent initiatives are those that start close to the value centers of the business. He cautioned against the common failure of large, expensive enterprise-wide AI pilots that make marginal improvements to internal processes without a clear link to the bottom line. For example, making 100 accountants 7% more effective doesn’t necessarily mean you can cut 7 accountants unless you are deliberate about how that saved time and effort translates into tangible gains.

Instead, he recommended starting with projects where the impact is immediate and measurable, such as:

• Building quick prototypes for new applications and products.
• Improving the effectiveness of product managers.
• Using AI to help investment analysts quickly consume vast amounts of proprietary data to ask better questions and close better deals.

Mossman also shared critical patterns for success, based on his experience:

1. Start Small and Iterate: Don’t try to boil the ocean. Begin with small, manageable projects that can be easily validated or abandoned without significant political cost.
2. Invest in Your People’s “Muscle”: The biggest challenge with new technologies like AI isn’t the technology itself, but the human adoption gap. Just like with flexible talent, a successful AI implementation requires you to invest in your employees, helping them build the intuition to understand when and how to use the new tools effectively. He noted that companies that do this well often give their employees access to tools like enterprise-grade ChatGPT, coupled with clear guidelines and a culture of experimentation.

He wrapped up by highlighting that the most successful organizations are those that don’t just buy a new platform but also invest in the internal expertise needed to truly leverage it. They recognize that platforms and AI are tools, but the real value is created by the people who use them.

Final Takeaways and the Road Ahead

The session concluded with a look at the future, reinforcing the idea that the business world is under immense budget pressure to do “more with less.” Head of Enterprise Strategy Tony Buffum returned to the discussion to emphasize that as companies are forced to cut full-time headcount, they still have to get the work done. In this environment, fractional, on-demand talent is not just a nice-to-have but a critical lever for organizations to pull.

The consensus from the experts was clear: flexible work is no longer a fringe concept but a core component of business strategy. The challenges of consolidation, technology integration, and talent management are real, but so are the opportunities for those who are proactive, analytical, and willing to invest in both their human and technological capital. The future of work will be defined by those who can successfully navigate the convergence of these trends, ensuring their organizations remain agile, compliant, and competitive.

The conversation highlighted the shift towards strategic planning around flexible talent, moving it out of the shadows of “rogue spend” and into a position of strategic importance. The partnership between Beeline and Human Cloud, and the insights from the panelists, underscore a future where the flexible workforce is not just an alternative, but an integrated and essential part of the modern enterprise.