Bubty Raises $3.3m to Scale Global Freelancer Compliance Solution

Bubty recently raised an additional $3.3 million in seed funding to expand its new service, Bubty Services, to a global market. This solution supports companies in navigating the complex regulations around freelancer and independent contractor (IC) classification, helping to avoid the legal and financial risks associated with misclassification across more than 190 countries.

As companies increasingly rely on freelancers and independent contractors to meet workforce demands, the risk of misclassification has become a major issue, with the global freelancer population now reaching 1.57 billion, or nearly 46.6% of the workforce. Misclassification often happens when freelancers or ICs are mistakenly treated as employees, lacking proper contracts or classification, which can lead to significant legal and financial repercussions. Regulatory bodies worldwide are intensifying enforcement on this issue, with companies like FedEx and Uber in the U.S. facing substantial fines for misclassifying workers.

Founded by Dutch entrepreneurs Lee Willoughby and Benjamin Schriel in 2020, Bubty’s Freelance Management System (FMS) has enabled businesses to effectively onboard, manage, and pay freelancers worldwide. The platform, which is particularly popular in the UK and U.S., now manages over a million freelancers, proving its appeal in the international market. Bubty’s latest offering, Bubty Services, allows companies to maintain compliance with local laws when engaging freelancers and independent contractors through automated compliance checks.

Lee Willoughby, Co-Founder of Bubty, stated, “Governments worldwide are cracking down on freelancer misclassification, aiming to protect vulnerable freelancers and contractors. This places a significant burden on businesses, who risk legal and financial penalties for non-compliance. Many companies, as a result, avoid engaging freelancers altogether. With Bubty Services, we remove that fear, offering companies a compliant, flexible way to engage freelancers, while preserving their independence.”

Bubty Services evaluates the nature of engagements between companies and freelancers or ICs to ensure compliance with regional laws. When needed, Bubty offers an Agent of Record (AOR) service, acting as an intermediary between clients and tax authorities to guarantee legal conformity. This service indemnifies clients against misclassification risks while allowing them to retain control over their freelance operations.

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