Fiverr, the online freelance gig marketplace, is planning a major downsizing of its staff as the company pivots to AI, the company's CEO announced in a jargon-filled letter to employees.

As reported by the Wall Street Journal, the layoffs will eliminate about 30 percent of the Fiverr workforce.

“The resizing and refocusing effort will allow Fiverr to go after growth opportunities as a leaner organization with an AI-native infrastructure and mindset," Fiverr wrote on its investor relations page.

Fiverr first launched in 2010 as an online gig marketplace where writers, musicians, visual artists, and other freelancers could offer their services for just $5. Soon after, Fiverr expanded its offerings, allowing freelancers to provide multiple tiers of services and charge more than $5 for their gigs.

In the Sept. 15 letter to employees, Fiverr CEO Micha Kaufman also said that the changes needed to become an “AI-first company” will be “painful”:

Today, we are launching such a transformation for Fiverr, to turn Fiverr into an AI-first company that's leaner, faster, with a modern AI-focused tech infrastructure, a smaller team, each with substantially greater productivity, and far fewer management layers. 

This transformation requires a painful reset, and as we make it, we will be parting ways with approximately 250 team members across the different departments, resulting in a smaller and flatter organization. This is possibly one of the toughest decisions that I have had to make, especially as Fiverr is such a magical place with a strong sense of belonging and mission-driven culture.

Recently, Fiverr has begun promoting AI use among its freelancer community. Earlier this year, for example, Fiverr announced a new program called Fiverr Go, which allowed its gig workers to train AI on their own work in order to automate their creations with AI. The company promoted this new AI service through a series of ads featuring character actor Brett Gelman, best known for his role on Stranger Things.

In a company-wide email from May of this year, Kaufman bluntly warned his staff about the company's pivot to AI.

“AI is coming for your jobs," Kaufman wrote to his employees. "Heck, it’s coming for my job too. This is a wake-up call.”

In recent years, Fiverr's community of freelancers has criticized the growth of users on the platform who are fulfilling gigs with generative AI.

"Is AI destroying the REAL creators?" asked one freelancer on Fiverr's community forums last year after noting their business on the site had been down.

Fiverr appeared to downplay concerns about AI in an ad it released in October 2024. The ad features a cheery musical number called "Nobody Cares," referring to Fiverr's claim that nobody cares if a freelance artist or creator uses AI. 

Now, in the pursuit of AI, Fiverr will lay off 250 of its employees.