Warrior Forum Scams Freelancer.com for $3.2 Million

I got an email this morning from some fella named ‘Allen Says’ with the subject ‘Warrior Forum joins the Freelancer.com Family’, so I took the bait and opened it up. I quickly learned that this guy was the founder of WarriorForum.com and he pawned the Warrior Forum for a cool $3.2 Million.

At first I thought it was some late April Fools joke, but after some investigation I learn that this transaction is real and Freelancer.com is now the proud owner of  730,000 members at the Warrior Forum.. Scams included.

The $3.2 million cash acquisition price was funded by existing cash reserves that Freelancer already had and the price was based on the annual revenue of Warrior Forum’s sales times 3.  Which means that Warrior Forum’s average annual income is around $1,066,666.67 per year.  Many people around the internet were surprise at this annual income as they thought the website earned way more than this. I am personally not surprised at this annual income considering the low value the website brings.

Their revenue model is based on forum access fees, self-serve advertising and listing fees for marketplace items posted in the forum by registered users. As far as I know, the Warrior Forum doesn’t get a commission from the WSO sales.

Immediate Changes to Warrior Forum

Matt Barrie, who is the Chief Executive of Freelancer.com posted within the announcement thread at Warrior Forum stating that some quick changes will be happening with some of the costs:

  • All WSO listings will now be reduced from $40 to $20
  • All current War Room members will have their 20 year membership extended to lifetime, immediately.
  • Moving forward new memberships will be $20 per year.

With the WSO listings being reduced to $20, my prediction is that there are going to be a swarm of low value borderline scams pop-up within the WSO section of the website and many members will not be happy with the end result. Could this be the downfall of the WSO? Time will certainly tell.

The other thing that really bugs me is that Matt Barrie said: “Being the world’s #1 Internet marketing forum, Warrior Forum provides the existing Freelancer community a complementary community based platform to interact and transact- enhancing user engagement in an important segment of work being performed in our online services marketplace.”

Do you seriously think that Warrior Forum is the world’s #1 Internet marketing forum? I don’t think so. If you want to join an awesome internet marketing business community then check out this place.

Why Did Freelancer.com Buy Warrior Forum?

Freelancer.com is a publicly traded company on the The Australian Securities Exchange and my guess was to bring value to their stock price.  But as the same day of the announcement, their stock seems to be going down a bit. Have a look:

Charting - ASX 2014-04-15 10-09-05 2014-04-15 10-10-39

Source: ASX

Yikes! That line does not look good. Do you think Freelancer.com has buyers remorse? It will be interesting to see how the two websites shall merge and what the long term strategy will be. But at the end of the day, I think Freelancer.com made a mistake buying the Warrior Forum as it’s going to tarnish any reputation that Freelancer has.

So now that you know about this acquisition, are you going to continue to use Warrior Forum and/or Freelancer.com? Let me know your thoughts below.

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