CrowdFlower raises $7M to crowd-source freelance work

Crowdflower, a firm that specializes in crowd-sourcing freelance workers and making it easy for companies to quickly find freelance programmers and other types of professionals, announced today that it has raised $7 million in its second round of funding led by Harmony Partners.

The company lets other companies quickly hire and outsource tasks to freelance workers across the world. CrowdFlower also announced today that it is launching a new niche version of the service that specializes in hiring out freelance workers to classify products because external companies were frequently using  the service for that.

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CrowdFlower’s second round of funding was oversubscribed, meaning there was more interest in the fundraising round than the company was willing to take. That’s become a pretty common trend in the start-up world as investors scramble to get a piece of hot companies. CrowdFlower instead wanted to keep the round small — something Harmony Venture Partners specialized in.

“They don’t demand a board seat, don’t necessarily try to push existing investors out of their portfolio,” said Lukas Biewald, the company’s founder and CEO of CrowdFlower. “There’s only a couple of VCs that are actually filling the need for startups that want to fill the smaller series B rounds.”

The funding will be used to spin out additional niche services for outsourcing. That means a majority of the funding will be used to hire additional engineers and staff and to beef up the company’s back-end infrastructure.

Greg Eaton from Harmony Venture Partners is joining the company as a board observer but will not serve as an official board member, as part of the deal. The San Francisco, Calif.-based company raised $6.25 million in an earlier funding round and seed round, and has raised $13.25 million to date.