This Startup Makes Freelancing Less Risky and More Rewarding – Mellow Startup Review

The gig economy is booming, and businesses are now dealing with the challenge of engaging a growing pool of contractors. Hiring someone for a quick task used to be enough, but that’s changed. Companies want to treat independent contractors as part of the team—which brings a whole new set of legal and payroll challenges.

Think about it: juggling compliance risks, benefits, and payments for a diverse, global contractor base is no small feat. That’s where Mellow comes in.

This global HR platform is designed to streamline the contractor management process. By embracing technology and assuming legal risks, Mellow makes it easier for businesses of all sizes to engage with local and international freelancers. The result? A smoother experience for both companies and contractors, filled with benefits like legal protections and prompt payments.

Curious about how Mellow is pulling this off? We did an interview to find out!

What is Mellow?

Mellow is a global HR platform designed to reshape how companies manage contractors. It caters to businesses of all sizes that engage with freelancers, whether on a local or international scale. This platform addresses the complexities involved in contractor management, such as compliance and payroll issues.

The problem is clear: companies need a seamless way to integrate contractors into their workforce. Mellow tackles this with an array of technological solutions. It assumes all associated risks, including legal obligations and misclassification concerns. For example, through its Contractor-of-Record service, Mellow ensures that contractors are properly classified and receive necessary benefits, thus bridging the gap between traditional employment and contract work.

What sets Mellow apart is its comprehensive portfolio that combines various services under one model. Unlike competitors that focus solely on either employment of record or payroll management, Mellow offers a pay-as-you-go system. This flexibility is particularly beneficial for companies hiring contractors from difficult-to-reach regions, making compliance and management less daunting.

This innovative approach reflects the shifting landscape of work, where non-traditional employment continues to gain ground. Mellow’s solutions position it as a valuable ally for firms navigating this evolving terrain.

Mellow Founders

Pavel Shynkarenko is at the helm of Mellow as its founder and CEO. With over two decades of experience in financial and legal technologies, he has a firm grasp on the intricate dynamics between businesses and independent contractors. Before launching Mellow, Pavel established his first HR tech company, Solar Staff, in 2014. This initial venture was born from his recognition of a rising demand for payment and administrative support in businesses employing freelancers.

The evolution from Solar Staff to Mellow is a fascinating journey. As Solar Staff grew, it began as a solution for service deal optimisation. Over time, it expanded into a multi-tool platform, adapting to the increasing need for specialised solutions that facilitate long-term contractor relationships. This pivot set the stage for Mellow, which officially launched in 2024, leveraging Solar Staff’s extensive experience and client base as a springboard. Today, Mellow is already collaborating with over 1,500 companies and 400,000 contractors from more than 100 countries.

In the early days, the focus was clear: streamline contractor management in a way that benefits both businesses and freelancers. Mellow sought to resolve the complexities that often hinder companies from fully integrating contractors into their workforce. This concept, crafted from his experiences, addresses issues like compliance, legal obligations, and payment processes associated with remote work.

Mellow’s inception was not just about recognising a market gap; it was about responding to a significant shift in how work relationships are evolving. Pavel realised that the future of work leans towards contract relationships as legitimate alternatives to full-time employment. This understanding shaped Mellow’s mission and continues to guide its innovative approach.

Interview with Pavel Shynkarenko, Founder and CEO of Mellow

The opportunity to interview Pavel Shynkarenko, founder and CEO of Mellow, provided insights into their plans and operations. He outlined the foundation and vision behind Mellow in a straightforward manner.

Q: Can you introduce yourself and your role at Mellow?
A: I am Pavel Shynkarenko, and I represent Mellow. I hold the position of founder and CEO.

Q: What is Mellow, and how does it differ from other companies in your space?
A: Mellow is a global HR platform transforming how companies engage with contractors. We focus on integrating freelancers as part of the workforce. Unlike others that limit themselves to employer-of-record services or payroll management, Mellow provides a variety of solutions within one model.

Q: Who is your target audience?
A: We cater to all size companies working with local and international freelancers.

Q: What primary problem does Mellow aim to solve?
A: Mellow streamlines the contractor engagement process. We tackle risks and obligations such as misclassification and legal issues. At the same time, we ensure contractors receive their due benefits, bridging the gap between full-time roles and contract work.

Q: Can you elaborate on the solutions Mellow offers?
A: We provide solutions tailored to regional demand. In the US, we have Contractor-of-Record services and an AI-powered tool that helps find suitable talent. In Europe, we address the need for freelancers’ social security, including legal services for obtaining digital nomad visas and tax support.

Q: How did you come up with the idea for Mellow?
A: My journey began in 2014 when I noticed a growing demand for payment and administration help in the freelance market. Initially, I started Solar Staff, which was focused on service deal optimisation. Over the years, it evolved into a multi-tool platform. This experience led to Mellow, which leverages Solar Staff’s expertise and client base.

Q: How does Mellow differentiate itself from competitors?
A: Many competitors concentrate solely on one service, either EOR or payroll management. Others focus on expensive Contractor-of-Record services. Mellow combines various solutions under a single contract with a pay-as-you-go model. This approach simplifies the contractor engagement process, even for companies in hard-to-reach areas.

Q: What are Mellow’s future plans?
A: In the US, our goal is to deepen our niche, working more with contractors from challenging regions. We plan to implement key integrations, strengthen partnerships with HR entities, and expand our payment solutions. In Europe, we will seek alliances with expatriate management services and legalisation providers.

Q: What is Mellow’s revenue model?
A: Currently, we see a monthly turnover of €18M, with a monthly recurring revenue of €800K. We serve over 1,500 companies and 400,000 contractors across more than 100 countries.

Q: Do you have any advice for aspiring entrepreneurs?
A: Business is tough. If you enjoy what you do, keep pushing forward. That passion will lead to success.

Q: Lastly, what key statistics should people keep in mind about the freelance market?
A: The freelance platform market is valued at $6.56 billion in 2024, and it’s expected to grow at a CAGR of 16.6% over the next five years, reaching $14.17 billion by 2029.

Feedough’s Take on Mellow

Mellow stands out as a disruptive force in the contractor management space, effectively addressing the compliance and integration challenges many companies face today. Its pay-as-you-go model offers remarkable flexibility, catering to businesses operating in diverse markets, making it a compelling choice for those navigating the gig economy’s complexities.

The future looks bright for Mellow as it continues to build partnerships and expand its offerings. However, maintaining agility in adapting to the fast-evolving freelance landscape will be key. Continued focus on user experience and strategic alliances can further cement Mellow’s position as a market leader in HR tech. Expect exciting innovations ahead that will redefine how businesses and contractors collaborate!