What Happens When You Go into a Dispute with Fiverr? Or: the Future of Justice Systems

Last week, Yam Mesicka from Israel ordered a cover photo for his web site from a Fiverr seller. He requested that the gig be done in 24 hours, asked for the PSD file, and added a few other extras for a final bill of $80. Yam then sat back and relaxed, knowing that in 24 hours he will receive what he has paid for.

Twenty four hours later, he was still waiting. Agitated and under time pressure, he considered cancelling his order, but found out he could only do that after 48 hours had passed. So he waited some more, and on the 47th hour, he received the finished product, which was extremely shoddy and amateurish in his view.

Yam told the seller he wanted a refund. The seller did not consent. Yam turned to Fiverr for help, and after four days was told that he should ask the seller to cancel the deal. He explained to the representative that he tried to reason with the seller to no avail, at which point she patiently encouraged him to continue negotiating.

That was the point when Yam broke down and realized the salvation was not going to come from Fiverr’s management. Instead, he turned to the PayPal account from which he was supposed to pay the bill, and opened a dispute with Fiverr, explaining that they did not give him the return for his money. A short time later, he received a mail from Fiverr telling him that his Fiverr account was now blocked, and asking him to cancel the dispute. In other words, Fiverr was essentially trying to force Yam’s hand in a dispute he had against a single seller, which Fiverr’s representative allegedly refused to solve herself.

Yam’s story is still developing, and Fiverr has not replied to my request that they comment on it. But there is at least one lesson we can learn from it, about the future of justice systems in the world and how citizens turn from governmental justice systems – i.e. courts – to commercial ones owned and operated by big companies.

Justice Systems

In modern society, the government is the main source of justice, with appointed judges supplying justice to all who come before them. The only problem is that the system isn’t really working for most cases of civil disputes. The justice system has turned into a complex monstrosity of rules, laws, rulings and lawyers who can navigate the system for exorbitant fees. Rebecca Lova Kourlis, a former justice of the Colorado Supreme Court, describes the situation best in her own words in The Atlantic –

 “…let’s say your teenage daughter gets into a car crash with an uninsured motorist. She is badly injured and has to have shoulder surgery that eliminates her ability to get that tennis scholarship to college — and now you must pay for the car, the medical bills, and college. You need to sue the uninsured driver. It’s likely, however, that the costs of the litigation will exceed your losses — and even more likely that it will take years to resolve the case. Too often today, the last place to go for actual justice is civil court.

The problem is doubly obvious in Yam’s case, and generally for every commercial company that sells its services to millions of customers at the same time, like Amazon, eBay, Fiverr and others. The courts simply cannot provide an answer to the millions of citizens who want to get a relatively small refund, or some other compensation for unsatisfactory services. And so, the large companies have opened dispute resolution centers of their own, and those are taking care of millions of disputes every year.

But what happens when a customer is unhappy with a certain dispute’s resolution?

This, in essence, is Yam’s case. Being unsatisfied with the way the dispute was being handled by Fiverr, he turned to PayPal’s dispute resolution system. In other words, he tried to switch from one commercial justice system to a competing one.

Is it really so surprising that Fiverr refused to acknowledge the authority of PayPal’s dispute resolution system? Of course not. Let’s be honest: companies want to keep their customers’ disputes to themselves, and it’s perfectly understandable why Fiverr won’t accept PayPal’s dispute resolution process. All the same, since PayPal controls the money transfer, Yam may even get his money back from Fiverr.

And all throughout this story, the governmental justice system is nowhere to be found.

This is a sign of the things to come. As I mentioned before, the current governmental justice system is quite simply incapable of taking care of most of citizens’ civil disputes. In its place come the commercial justice systems, whose rules are not necessarily dictated by governments, morals or ethics. In fact, there is nearly no real supervision by governments on commercial justice systems.

You may side with the seller in Yam’s story, or with Fiverr, or even with Yam himself. The side you choose to take are beside the point. The real story here is that the execution of justice is rapidly being relegated to commercial companies, each of which with its own unsupervised justice system. And some of which – like Fiverr – are apparently willing to ban you from their services if you turn to justice systems other than its own.

Does that scare you yet? If not, just consider what happens if Google decides to ban you from using your Gmail mailbox just because you opened a dispute with it. A relatively small number of incredibly large companies are controlling our virtual platforms. They are gaining power rapidly while the government loses power, and people like Yam are caught in between. And there’s no dispute about that.

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Fiverr is Broken by Design – and it Hurts Everyone

A few days ago I decided that I wanted a new business card for the up and coming new year. I headed straight to Fiverr, and browsed through some of the graphic designers who offered their services for five dollars or more. After a few minutes, my choice was made: I decided to use the designer with more than a hundred of 5-star positive ratings, and literally no negative reviews at all.

Of course, the gig didn’t really cost five dollars. I added $10 to receive the source file as well, $5 for the design of a double-sided business card, and $5 for a “more professional work”, as the designer put it. Along with other bits, the gig cost $30 altogether, which is still a good price to pay for a well-designed card.

Then the troubles began.

I received the design in 24 hours. It was, simply put, nowhere near what I expected. The fonts were all wrong, the colors were messed up, and worst of all – the key graphical element in front of the card was not centralized properly, which indicates to me a lack of attention to details that is outright unprofessional. So I asked for a modification, which was implemented within a day. It was not much better than the original. At which point I thanked the designer, and concluded the gig with a review of her work. I gave her a rating of generally three stars – possibly more than I felt that her skills warrant, and wrote a review applauding her effort to fix things, but also mentioned that I was not satisfied with the final result.

An hour later, the designer sent me a special plea. She asked me, practically in virtual tears, to remove my review, telling me that we can cancel the order and go to our separate ways. She told me that her livelihood depends on Fiverr, and without high ratings, she would not be approached by other buyers in the future.

A discussion I had with a Fiverr service provider, who begged me to give her a higher rating
A discussion I had with a Fiverr service provider, who begged me to give her a higher rating

I knew that my money would not actually be returned to me, since Fiverr only deposits the return in your Fiverr account for the next gigs you will purchase from them.But seeing a maiden so distraught, and me having an admittedly soft heart, I decided to play the gallant knight and deleted my negative review.

And so, I betrayed the community, and added to the myth of Fiverr.

Lessons for the No-Managers Workplace

In December 2011, the management guru Gary Hamel published an intriguing piece in the Harvard Business Review called “First, Let’s Fire All the Managers”. In the article, Hamel described a wildly successful company – The Morning Star Company – based on a model that makes managers unnecessary. The workers regulate themselves, criticize each other’s work, and deliberate together on the course of action their department should take. Simply put, everyone is a manager in Morning Star, and no one is.

You should read the article if this interests you (and it should), but just to sum up – Morning Star has some 400 workers, so it’s not a small start-up, and the model it’s using could definitely be scaled-up for much larger companies. However, Hamel included a few admonishments, the first of which was the need for accountability: the employees in Morning Star must “deliver a strong message to colleagues who don’t meet expectations,” wrote Hamel. Otherwise, “self-management can become a conspiracy of mediocrity.”

The Morning Star company - a workplace without managers. Source: The Los Banos Tomato Festival
The Morning Star company – a workplace without managers.
Source: The Los Banos Tomato Festival

The employees in Morning Star receive special training to make sure they understand how important it is that they provide criticism and feedback to other employees, and that they actually hurt all the other employees if such feedback is not provided and made public. Apparently the training works, since Morning Star has been steadily growing over the past few decades, while leaving its competitors far behind. In fact, today “Morning Star is the world’s largest tomato processor, handling between 25% and 30% of the tomatoes processed each year in the United States.”

Morning Star is a shining example for a no-managers workplace which actually works in a competitive market, since each person in the firm makes sure that others are doing their jobs properly.

But what happens in Fiverr?

Is Fiverr Broken?

I have no idea how many service providers on Fiverr beg their customers for high ratings. I have a feeling that it happens much more frequently than it should, and that soft-hearted customers like me (and probably you too) can become at least somewhat swayed by such passionate requests. The result is that some service providers on Fiverr will enjoy a much higher rating than they deserve – which will in effect deceive all their future potential customers.

Fiverr could easily take care of this issue, by banning such requests for high rating, and setting an algorithm that screens all the messages between the client and the service provider to identify such requests. But why should Fiverr do that? Fiverr profits from having the seemingly best designers on the web, with an average of a five stars rating! Moreover, even in cases where the customer is extremely ticked off, all that will happen is that the service provider won’t get paid. Fiverr keeps the actual money, and only provides recompensation by virtual currency that stays in the Fiverr system. This is a system, in short, in which nobody is happy, except for Fiverr: the customer loses money and time, and the service provider loses money occasionally and gets no incentive or real feedback that will make him or her improve in the long run.

Conclusion

As I wrote earlier, Fiverr could easily handle this issue. Since they do not, I rather suspect they like the way things work right now. However, I believe that sooner or later they will find out that they have garnered themselves a bad reputation, which will keep future customers away from their site. We know that great start-ups that have received a large amount of funding and hype, like Quirky, have toppled before because of inherent problems in their structures. I hope Fiverr would not fail in a similar fashion, simply because it doesn’t bother to winnow the bad apples from its orchard.