I'm Tim Fung. I'm the Co-founder and the CEO here at Airtasker.
I'm Mahendra Tharmarajah. I'm the CFO at Airtasker. Really pleased to be here delivering my first set of full year results.
Amazing. So, let's go back to the beginning and give a brief reminder on what Airtasker is. So Airtasker, we're building the world's most trusted marketplace to buy and sell local services. And in really simple terms, we connect people who need work done with people who want to work. We're doing this in service of our mission to empower people to realize the full value of their skills. Creating jobs isn't just the byproduct of the work we do, it's actually the core purpose of the business. And I'm really proud to say that over the past financial year, tasks online and regional , putting over AUD 500 million into the pockets of our Taskers in community, less all of the fees that Airtasker generates. So it's AUD 500 million in earnings in the bank accounts of our Taskers.
Now, I'm gonna pass it over to Mahendra to speak through some of the key highlights.
Great. Thanks, Tim. So, starting across the top of the screen, our revenue for the year was AUD 44 million, up 40% on the prior year, with a terrific result. That incorporated the first full year of the Oneflare business that we acquired in May 2022. And then also about 13% of organic growth across our Airtasker marketplaces. As you can see, our gross profit is quite strong. We've got about 95% gross margin. It tracks very closely with revenue. Our only direct costs that come out of that revenue line are related to insurance, task liability insurance, and merchant fees.
Moving across, we had a fantastic result with our EBITDA loss, which improved 53% year-on-year, so down from AUD 17 million to about an AUD 8 million loss. And, that's a combination of top-line revenue growth as well as tight expenditure management that's improved that result. Moving to the second line or the second row, we've got a presentation there of our Australian EBITDA. So this is our Australian marketplaces, and they've generated AUD 25 million of EBITDA, which is up 29% year-on-year. That's against the left-hand side scale. If you look at the right-hand side, you can see in the blue bars, you can see that we have pretty much covered our fixed head office cost, which we'll talk about further on in our presentation.
Our cash position is really strong, AUD 16 million on the balance sheet, no debt. We reduced our cash outflow by about 24% year-on-year, and placing us in a really strong position to be free cash flow positive through FY 2024. And then finally, more recently, in early June, we announced our partnership with Channel 4, which is about AUD 6.7 million worth of media advertising that they're providing us over the next two years, and we'll talk more to that further on. Back to you, Tim.
Thanks, Mahendra. I'm gonna speak through some of the marketplace highlights. So, one of the themes of the year was that we saw a really, really strong surge in supply in our marketplace, the number of people who wanted to work by Airtasker. So, we saw our active Taskers on the marketplace increase about 40% year-on-year, up to 149,000 workers on our platform. We also introduced Oneflare into the Airtasker group. Oneflare is all about addressing the small business segment, and we saw over 12,000 small businesses actively quoting through the Oneflare platform. That contributed to over 9 million quotes being created in the Airtasker platform, which was up about 40% on the prior year.
Across to the demand side of our marketplace, it's certainly been a challenging macroeconomic environment with consumer sentiment, you know, trending and being pretty soft. We did see a 15% increase in posted tasks, which is emblematic of the demand in our marketplace, and that's trending quite well. Of course, during this period, we've really focused on being a prudent operator and making sure that we're really efficient with customer acquisition. We saw a 60%, 66% improvement in our customer acquisition cost, and we've got really profitable unit economics with almost a 10 times LTV, lifetime value to CAC ratio.
Finally, we have passed over 6.75 million customer reviews on the Airtasker platform, and this is really all about the reputation and the trust in our marketplace. So to see that increase massively year-on-year presents a really great competitive advantage and really sticky platform because people are building their brands and their reputation on Airtasker. I'll now talk through a little bit of an overview of our business model and our strategy. So, turning back to, like, what makes Airtasker special? Airtasker's unique value proposition is that we're an open and infinitely horizontal marketplace. From the open perspective, we're built on transparency and reliability and accountability.
And what that means is, rather than using manual operations to create great service quality, we've built a system which really manages that, and that's why we have a light touch operating model and a really high gross margin. We're also infinitely horizontal. We're unifying a very fragmented local services industry, where there's, like, millions of different people offering these services. We're bringing all that together. But also, I think what's really important is that we're enabling the creation of entirely new services industries. So whether it's the person who needs a drone removed from a tree, or whether it's somebody who needs to, you know, have a cockroach removed from their home, Airtasker is enabling that to happen and creating entirely new jobs.
For our customers, this means that Airtasker creates really fast response times, has a great range of services, the biggest range of services you can imagine, and is really great value for money. For Taskers, we're creating instant work opportunities. Taskers have complete control over what they charge for services and complete flexibility in the way that they work. We've got a really efficient business model at Airtasker, and what that enables is very profitable unit economics and a long-term sustainable competitive advantage. So looking at the unit economics of Airtasker, roughly we earn a 17.6% take rate. So for all of the sales, all the GMV that goes to our marketplace, Airtasker's revenue is about 17.6% of that, and about 81% of that goes to our customers and Taskers.
From that revenue, we have very high gross margin. As Mahendra mentioned earlier, we have a 94.5% gross margin. Really, the only cost coming out of that are our insurance costs, about 1.8%, of revenue, and our merchant fees for payment services, credit card transactions, which is about 3.7%, of our revenue. We have a really efficient customer acquisition model. We don't spend a lot of money into, like, paid and performance marketing. We actually invest really heavily into creating a strong core product, a really powerful brand, and really efficient customer acquisition. And so, during FY 2023, we had a cost of acquisition per customer of about AUD 9, but we made about AUD 81 in net revenue, from each unique customer, that we acquired.
As mentioned, we also passed over 6 million customer reviews on our platform, and that really represents a sticky platform and a unique competitive advantage, which provides us with long-term margin assurance. We also have a very high operating leverage model at Airtasker. If you have a look at this chart, and we are very well aware that there's a lot of bars in this chart, so I'll talk through them one by one. If you look over on the left-hand side there, you can see that Airtasker has a significant global head office investment that we make into operating our business. So that's, you know, design, engineering, product management, as well as our finance, people ops, and executive functions. We also have an investment that goes into building new products, so a significant innovation investment as well.
If we look over on the third column, we are looking at the EBITDA of our Australian marketplace, and what you can see there is that we're generating a lot of revenue, and we have only a certain amount of fixed costs which go out variable costs, which go into marketing and customer service. The EBITDA Australian marketplace largely covers our global head office expenditure. What this means is, as we move into new marketplaces like the U.K. and the U.S., those marketplaces don't require us to significantly scale that fixed head office expenditure. In fact, we have, you know, a variable expenditure that goes into marketing and customer service in each of those marketplaces, but they're very much leveraging the investments that we've made into having a world-class software product.
So what's really exciting there is if we can get those economics in the U.K. and the U.S. to match what we've done before in Australia, then we're going to have a very, very profitable and very high operating leverage business. On the right-hand side here, you can see that we've been pondering a lot. How do we build that scale in Australia? How do we replicate those economics that we've proven in the Australian marketplace? Our partnership with Channel 4 is reflecting on what we achieved in Australia together with Seven West Media, where we were able to 20x revenue during a five-year period, and we were able to create investment opportunity for Seven to make 5x investment during that period as well.
So it was a really win-win outcome for both Seven West Media and Airtasker Australia. So looking at, like, how can we replicate that into the U.K. and U.S. markets? Obviously, I'm going to talk a little bit more about our partnership with Channel 4, but we think that we have a very proven strategy that we can continue to replicate in new countries. Now, I'm gonna talk a little bit about the operations of the business during FY 2023. So FY 2023 was a very, very interesting year. We really saw the macroeconomic environment change, and as I mentioned earlier, we saw marketplace supply. The number of people who are wanting to work really, really escalate in an environment in which consumer demand was reducing.
So if we have a look at our marketplace demand, in Australia, we did see a 15% increase in posted tasks through our platform. But if we actually extract out the Oneflare acquisition, we actually saw a decrease, a softening of about 6% in posted tasks, which went into the top of the funnel into the Airtasker marketplace. Now, what's really, really interesting is that with the surge in supply, we actually saw that the matching rate improved on Airtasker by 8% for every one of those posted tasks. The cancellation rate started to come down a lot, and overall completed tasks increased by 10% through the Airtasker marketplace, and revenue per posted task actually increased by 20%.
So in the big picture scheme of things, we saw while demand softened, supply surged, and our marketplace continued to grow even during a difficult macroeconomic environment with interest rates increasing. We also boosted operational efficiency at Airtasker, with a strong focus on making sure that we demonstrate the profitability and the unit economics of our business model. So the first thing that we did is we followed through on our integration plan with Oneflare, and we're seeing that Oneflare's revenue in FY 2023 is ahead of expectations that were shared with the market when the acquisition was announced. We saw that the business is performing really, really well, and during FY 2024, we're going to continue to invest in the growth plans for Oneflare.
The integration's going well, and we're making sure that we're really pulling all the dials across marketing, pricing, and operational efficiency to improve the revenue and the profitability of the Oneflare business. During the year, in April 2023, we also restructured the Airtasker organization, and this was a really, really difficult thing to have to do. We reduced our headcount by 20%. This was, you know, very positive in terms of improving operational efficiency at Airtasker, but of course, really, really difficult to have to part ways with a number of our team members. So, really, really a hard decision to make, but I think the right decision to make for Airtasker over the long term.
We do continue to make ongoing investments into the growth and the well-being of all the talented people we have at Airtasker. Really, just like our marketplace, the people are the core of our company and our organization, and we're going to continue to invest into their growth and well-being and learning and development. On the left-hand side here, we're showing some great images from Learning Week at Airtasker. Just one of the programs that we've put in place to make sure that we're really delivering on our promise, creating a great employee experience and ultimately doing what's best for Airtasker over the long run. We also focused our growth plans through the year.
We really narrowed in on what are the few things that we're going to do really, really well, in order to make the core product experience of Airtasker amazing, and lay the foundations for really being able to ramp up the scale, into the coming years. So, the first thing that we did is we actually released an entirely new Airtasker, as you can see. Then we transferred to a new branding, put that all across our website application, all of the marketing that we do, which is a phenomenally huge effort. We brought on board a brand new Chair, Cass O'Connor.
Cass has already had a huge impact at Airtasker, bringing her experience being the CEO of Prime, being Chair at Tribe and, of course, also experience in being part of eCorp, which actually scaled via media partnerships, eBay, for the United States into Australia. So, turn that story around and taking something from Australia to the world has been something that really excites Cass and really excites us as an organization. Finally, we secured over AUD 6.7 million in a media advertising asset together with Channel Four. Now, that's sitting on our balance sheet, we're going to be executing on that during FY 2024, and really to the entire U.K. population.
Four million people watch Channel 4 each year, and that's about 78% UK population. Finally, we continued into trust and safety in our community and security in our platform. We made significant inroads building on top of just investments in cybersecurity to actually invest into security of our marketplace users and making sure that Airtasker is really that trusted brand with a trusted platform. We saw a 51% decrease in attempted fraud through the platform. We saw a significant decrease in duplicate accounts on our platform, and again, that's really part of our strategy to be a trusted trust and safe community marketplace.
We saw a massive decrease in the number of people trying to take over accounts or do nefarious activity through our marketplace. I'm now going to pass it over to Mahendra. He's going to talk us through the FY23 financial results.
Thanks, Tim. I'd like to start by providing a little bit more detail that Tim provided earlier. So we're going to talk through the different marketplaces that we have within the group. So the first one really is our established marketplaces. So these are principally Australia, the Airtasker marketplace, and the Oneflare marketplace. They're at the scaling phase of their marketplace life cycle. We had a really great results of 40% revenue growth in Australia up to AUD 43 million. Contribution about AUD 33 million, almost AUD 34 million from Airtasker. And earlier tracks very closely with revenue was up 42% year-on-year. And then that's driving an EBITDA contribution of AUD 25, as I mentioned earlier. We'll talk a bit more about how that sits within the broader group. Turning to our newer marketplace.
So the first one in the U.K., which is in the next phase of our growth, which is really the 1 to 100, where we try and balance both demand and supply. Revenue is tracking really well, is up 93% year-on-year, and the gross marketplace volume was up 5% year-on-year. We've already talked about the Channel 4 that will support our growth and drive brand awareness, user acquisition through the course of FY 2024. We'll talk about that further on. Then finally, the U.S. marketplace, which is still in the zero to one phase of the life cycle. We're seeing good traction in terms of driving both in post tasks and Tasker offers, but a ratio of about 1/2 to 1 at the moment.
And with that on track to, you know, keep growing, into a larger marketplace over time. I'd like to now just a little bit this presentation of our operating segment. So we call this, our marketplace staging economics, which we've talked about previously in other releases to market. So what it essentially does here is it reconciles the Australian EBITDA of AUD 25 million that we've talked to already, down to group EBITDA loss of AUD 8 million. I'll walk you how this works. So essentially, as Tim mentioned, we have quite a scalable operating model in that we have high fixed costs, but they're not going to grow as we expand the business and grow initially. So the Australian marketplace is generating about AUD 25 million EBITDA. We then have our global head office costs.
Our global head office costs fall into two buckets, principally. One is the OpEx line, which is about AUD 20 million for the current year, and that's really the infrastructure that supports the business. So it's the financing, the executive team, the people, operations team, the people who run the maintenance infrastructure of our IT, that type of thing. And then, what you can see from this presentation is our Australian EBITDA essentially covers our fixed costs. So we're left with about AUD 3 million-AUD 4 million of net EBITDA. And so at that point, the Australian business is paying for our fixed costs. We then have the next line is really the innovation investment.
So that's, I guess you could describe it as discretionary, but something that value and place a lot of, you know, emphasis on in investing into the platform. And this is essentially costs that wouldn't fall within the definition of, I guess, R&D and are capitalizable, but certainly important in maintaining and building on the long-term user experience. And then the final item is really the EBITDA of our international marketplace, any marketplaces, and that's largely driven by marketing costs. And we need to invest in these marketplaces upfront to build the network effects and drive revenue over the long term. And that drops down to about an AUD 8 million loss at the group EBITDA level.
What you see from this presentation is that really most of the loss or all of the loss is covered or generated by the new marketplaces. Turning to our financial position on our balance sheet. We're in a pretty solid position. We've got AUD 16 million of cash and no debt. Our cash outflow, net cash outflow for the year decreased about 24%, down to about AUD 7 million for the year, and our loss after tax improved by 37%. We continue to be focused on managing our costs and our cash flow. I'll now hand back to Tim.
Thank you, Hendra. In FY 2024, looking forward, the first thing to call out is that we're really focused on ensuring that we're going to have a positive free cash flow result at a group level in FY 2024. So how are we going to do that? The first thing is that we're going to really, really focus in on doing a few things really well. That does mean that we're going to be divesting all of the non-core businesses that were acquired through the purchase of Oneflare. This is expected to have an impact of about AUD 1 million on FY 2024 revenue, but we do believe it will deliver a positive impact on operating costs, cash flow, and strategic management focus.
We're also going to continue to optimize the marketing efficiency, the way that we do fee pricing, growth squads, and our structure in our core Australian platforms to deliver positive free cash flow in FY 2024. We're looking on the right-hand side there, we can look through all of the portfolio of Oneflare assets there. The Renovate Forum and Word of Mouth have all been divested, and we are currently exploring strategic options with respect to UrbanYou. So in ensuring that we have this focus, we can really drill down into just two things that we're going to do really well in FY 2024. So the first is that we're going to invest in the core product experience, and the second is that we're going to scale into new markets via media partnerships.
But focusing on core product experience, we're going to do this. We have a really, leadership position, in the Australian market. We want to consolidate leadership position by investing into experience that every one of our customers and Taskers are experiencing, every single day. So when we did our customer research, what we found is that the number one thing that our customers are looking for is: how do we increase the reliability in our marketplace? We've got a huge breadth of services. We've got, by far, Australia's number one marketplace in terms of, post tasks and active tasks, but how do we, improve the trust and reliability between users on our platform?
One of the key things that we are focusing on is making sure that we develop policies which make both customers and Taskers really aware of their responsibilities in the marketplace. And then we're making sure that the incentive model, the pricing and fees on Airtasker all line up to making sure that people who follow those responsibilities follow our community guidelines are rewarded from that. We've made some really, really positive inroads already, and we continue to have reliability in FY 2024. We've already seen a 10% improvement completion rates during FY 2023, and we're going to really, really start to see in FY 2024. The second thing that I think is really important is address platform leakage.
One of the things about Airtasker is that we've created a very low-friction environment. That means that, you know, people can have use Airtasker. It's a very fast-moving platform. What we're doing now in our Australian market leadership position is just balancing that to make sure that we're getting the right low friction, but a really reliable, high-quality experience. A big part of that is addressing things like leakage in our marketplace. So you can see we've just introduced a model which really relates to showing customers and Taskers the value that Airtasker is providing. We did a thing called a pricing system called the Connection, and this is charged upfront to both customers and Taskers to make sure that we are monetizing, addressing leakage in the marketplace.
We're seeing some really, really promising results here. We're only weeks into experimenting and rolling out these kinds of features, but we're working closely. We're seeing really positive results. Finally, we're going to continue to delight our customers and continue to invest in the Airtasker brand. One of the things that I think has been really remarkable to see in our financial results is that Airtasker has actually made only a very small moderate investment into above the line to brand marketing in FY 2023, but we maintain a 63% up brand awareness. How are we doing this? We generate a lot of earned media on Airtasker.
People love to talk about Airtasker, whether it's about using Airtasker to secure our Taylor Swift tickets, which took over the headlines in May and June. Appearing in Amazon Prime's new show, Deadloch. So not going to all the murder mystery secret. Look out for the characters of Airtasker on that show. All of this contributes to making Airtasker a household name, part of, a part of the local zeitgeist, and I think that really drives the ability to not have to pay marketing, but being able to maintain a really strong brand presence and awareness. Finally, we're really excited about launching our UK marketplace. We've got a AUD 6.7 million investment from Channel 4, which is sitting on our balance sheet.
During October of this year, we're going to be launching a brand-new television campaign. That campaign's going to let us hit up at least 7 million people in the United Kingdom, 8% of the entire population. So basically, everyone who's watching TV is going to know about Airtasker. We've also entered into a formal collaboration with homewares company, Dunelm, in the U.K. Dunelm is a much-loved household brand in the U.K. I guess it's kind of like Spotlight meets Bunnings in Australia, 180 stores across the country. As you can see here, Airtasker is now being promoted as the furniture assembly and installation service across all of those stores.
Every single box of flat-pack furniture now goes out with an Airtasker sticker on it to remind people about how they can use Airtasker to make their lives a little bit simpler. What we love about this partnership with Dunelm, though, is it's really aligned with our mission. It's not just about helping people get their furniture assembled or their lights installed. It's also about creating jobs in the local community. And so one of the things that, you know, really inspired us to form this partnership, this collaboration with Dunelm, is the fact that we're really aligned in, we wanna create jobs in these local communities surrounding our Dunelm stores.
And that's really helped us to spread our marketplace across London and broadly in the U.K. So you can see on the right-hand side here, where, as Mahendra mentioned, we currently have a GBP 4 million per year annualized GMV run rate. We believe the market in the U.K., you know, is absolutely enormous. About GBP 40 billion is spent on services each year, so we're a fraction of the way there. But together with this partnership with Dunelm and with Channel Four, we believe we've got a massive opportunity ahead of us. Once we fine-tune that playbook and get it right, we can take that into new markets.
But as I mentioned earlier on, we're really focused in FY 2024 on doing a few things and doing them really, really, well, and ultimately doing them in a way that creates a profitable business. So, without wanting to, you know, spill the beans on Airtasker's brand new marketing campaign, all I wanted to finish off here with is saying, Airtasker, yeah, tasker, let's do this! So, Mahendra, that wraps up for for today. We're gonna cross across to Q&A.
Yep. I'll just give it a minute. There's nothing come through yet.
Awesome. We, we love a, an awkward silence at, at Airtasker as a way to, to make sure everyone feels comfortable to, to ask questions. So, as a last shout-out to, to the interwebs, if anyone, has any questions, for either Mahendra or I, I'm more than, more than happy to take them.
Okay, we've got one question just coming up. We've got a few coming through now. So the first one is, "What should the investors hope for this year? Dividends?" There's a question mark.
So, as mentioned, I think what FY 2024 will mean for Airtasker is we're on track to be a cash flow positive result at a group level. We're gonna continue to invest into both our core product experience and into investing into new marketplaces. We do not have any current plans to issue dividends. I'm gonna continue to invest into our business. What I do think is really important to see is that we are in a really sound financial position with over AUD 16 million on the balance sheet, and we have no need to raise any further capital or be reliant on the external markets to raise capital.
Yeah. So this was in the context of the Channel 4 partnership. Can you talk to the experience you had with Seven West Media in Australia and the timing it took to ramp up?
We had a great win-win experience with Channel 7 , Seven West Media in Australia. Back in 2016, we were doing about AUD 10 million of GMV, which is roughly where we are in the UK as well. We're doing about GBP 4 million annualized GMV. And during that 4.5 years that we were in partnership with Seven West Media, we saw that brand awareness increased about 6x, GMV increased about 10-12x, and revenue increased 20x. What was really great about that is that at the end of that partnership, Channel 7 was able to exit and make, you know, about 5x money on that investment. So I think it was really a win-win situation.
And so when we showed these results to the folks over at Channel 4, they were like: "Oh, yeah, let's do a bit of that. That sounds really great." And we're, of course, really excited to do that, to turbocharge the U.K. as well.
Okay, next question was: Are you looking to go into any other markets?
At this stage, we're really focused on doing a couple of things really, really well. The U.K. is an enormous market. It's about a $70 billion or GBP 40 billion TAM, and the U.S. is about $500 billion of TAM. So we're really focused on these two markets now. One thing that I will call out, though, is what we mentioned earlier about operating leverage. One of the great things about Airtasker, we've invested into a platform, a system, a way of doing things, and what that means is that as we go into each new country, we don't need to replicate those costs. That system, that IP that we've built goes into new countries and can add value into new countries.
What we do need to replicate is the marketing costs, the cost that it takes to get from zero into a scaled network effect. So the media partnership model is really a smart way of us being able to gather those necessary resources that it takes to build our marketplace. So, you know, there's definitely opportunity there, but we are gonna be really focused in FY24 on the U.S. and U.K.
Okay, great. I'll take the next one. So this is: Is that free cash flow positive or operating cash flow positive? So it's definitely free cash flow positive is our target for FY 2024. And then another question which I'll as well, so: How does the profitability look for FY 2024? So our focus for FY 2024 is principally around, first leaving, FCF positive. And then, the next item we really focus on is EBITDA. We have a number of non-cash items that go through our P&L. So, for example, we've talked the AUD 6.7 million of media advertising that we have on our balance sheet, and that'll be amortized as we use that, and that's effectively a non-cash item that will hit our P&L.
Similarly, we have a lot of share-based payments that we provide to our employees and our staff, and that gets expensed over the duration of their service. So those things tend to depress our profitability from an accounting perspective. So, in short, our focus is on FCF positive first and then EBITDA after that. What are you seeing in terms of competition in Australia? Next question.
So, in Australia, Airtasker is by far the market leader in sort of in terms of generating demand. So, you know, if you look at something like hipages, I think they saw about a 13% decline in posted tasks through the platform, and they're probably about 40%, you know, maybe two-thirds of the size of Airtasker. So, certainly, Airtasker has built out that leading market position in Australia. Where do we think that there could be competition in the future? I think we're seeing some really interesting things happening in the AI space and interesting type of things being experimented with Google themselves doing a lot of things.
But they're very much in the advertising space, and what is it Airtasker is doing that is very, very different to that is we're creating a platform. We're investing into trust and safety in that platform, and so we're doing a lot more than just connecting people together, I think that really is a defensive moat. But also say that the reputation of our marketplace is also really important. Over 6.75 million customer and tasker reviews have been provided on Airtasker. What does this do is creates that fabric of being able to know who's good and who's not good in the marketplace, and that's what enables people to trust each other in the marketplace. That's our competitive advantage in the long run.
Great. There's another question here regarding Dunelm. Does the company take any revenue from that relationship?
We do have a commercial-
Sorry, does Dunelm make any revenue from that relationship?
Yeah, we do have a commercial arrangement with Dunelm on a completely variabilized basis. But the really interesting thing I think about that is, Dunelm's not looking at this as a way of making money. They're actually looking at this as a way of investing into creating more jobs in the local community. So the way they see it, it's like more jobs being created, means we can go out and invest into education, onboarding, ways of being able to create even more jobs around Dunelm stores. So I think, again, the Dunelm partnership is really cool from a furniture assembly, get your lights installed perspective, but I think it's really cool is we are aligned on the mission of Airtasker, creating more jobs.
Great. The next question is, what's the growth percentage expectations for FY 2024? So I can talk to that one. I, I think at, at the moment, our forecast is something in the order of, you know, high single digits to low double digits for FY 2024. Next question: What is the strategy with Oneflare?
Oneflare has proven to be an incredibly valuable addition to the Airtasker group. Just going back to the thesis for why we acquired the Oneflare business, is that it enables us to scale network effects. So enable us to, you know, we're already significantly higher, you know, larger than hipages in terms of demand, but it also enabled us to scale even further and build that leadership position. The second thing it enabled us to do is move into the small business market. Airtasker really focuses on independent Taskers, people who are, you know, sole traders, who are starting out and want a way to be able to earn money independently, versus Oneflare, which really focuses on small businesses.
What we've observed over the last year is that it does require a different approach. You know, we've got an incredibly awesome sales team that works directly with small businesses in the community, and we really realize the value of this product. So, for FY 2024, I absolutely gonna see the Oneflare business continue to have a strategy which and a brand which is present in the Australian market. But certainly at the long term, we're looking at how do we bring the two things together. You won't see that in FY 2024. FY 2024 is about spending and extracting, you know, really healthy and profitable metrics out of the Oneflare business.
Next item: Can you please provide some details around the structure of the media deal? I presume that's the Channel 4 media deal?
Sure. Do you wanna take that one ?
Sure. So, the deal we struck with Channel 4, essentially was that they would provide media advertising across the Channel 4 network over a period of two years, which is around GBP 3.5 million sterling. And in exchange for that, we provided them with 20% equity in our U.K. subsidiaries. So we have a U.K., an operation or an entity in each market they're in. So we sold them effectively, 20% of the business, and we get to use that for advertising over the course of next year.
The exit point for that, for Channel 4, given that obviously the U.K., our U.K. business is not a publicly traded company, the exit path for Channel 4 is that we will buy them back our 20% in five years' time, and there's an option. It's a calculation that's based on the higher of, the group's, enterprise value, multiple or its market capitalization multiple, multiplying the, trailing revenue of the U.K. for the, the 12 months to June 28. Any big plans to enter big markets like India?
So, you know, the total addressable market of Airtasker's current U.S. and U.K., you know, opportunity is enormous. It's, it's $600 billion opportunity. So I think, you know, we've definitely got our, our work cut out for us in FY 2024, and focused on, on the U.S. and U.K. markets. That said, I think with this, media partnership insight that, that we've had, there is really, a lot of opportunity, globally to, to scale this, business model without having to, you know, go into, you know, huge periods of cash burning and, and things like that. So it's a very smart, scalable, and capital-efficient method of scaling this business, across the world.
Certainly, we're gonna keep our eyes open for any of these sorts of partnership opportunities that arise across the world.
Following on from that, do you expect the growth rate for the U.S. and U.K. to track similar to Australia over time?
So we have seen the U.S. and U.K., you know, sort of go from zero to one much faster than we did in Australia. So, you know, from that perspective, things are sort of going a bit faster than they did in Australia. They're also larger markets. Hopefully, also, our playbook is a lot more refined than it was when we started in Australia. So all things being equal, I think, you know, we can certainly move faster in the U.S. and U.K. compared to what we did in Australia. But, you know, if we can replicate what we did in Australia, we'd be pretty happy with that, as well.
Given the current discounted share price, are we planning on initiating a share buyback or some other mechanism to create value for investors and improve fundraising options in the future?
Thanks for this question, Stewie. I think there is a discount to the share price. I think, you know, the current valuation multiple on an EV basis is pretty attractive. So, you know, we'll explore all options. I don't have the current plans to do a share buyback.
Okay. In terms of platform investment beyond user experience, are there big opportunities that Airtasker is considering over the next year?
Sorry, can you repeat the question, Mahendra?
In terms of platform investment beyond user experience, what big opportunities is Airtasker considering over the next financial year?
So as mentioned, we do want to really zero in on doing a few things well. At the very bottom of that pyramid is addressing the number one thing that our customers tell us they want fixed on the marketplace, which is the reliability of the marketplace. So, where we're investing there is into things like two-factor authentication, into ensuring that there are no duplicate accounts on the platform, to ensure that we have a cancellation policy, that we've got responsibilities set out, that there's clear attribution when things go well or don't go well, through a task. So really, that's the basis of the platform, and we're going to keep focusing on those really simple important parts of our core product experience for FY 2024.
That said, there are some really, really exciting second or third horizon opportunities for Airtasker that you will see emerge over the coming months and years. The first is that we've seen that the fee model on Airtasker can really be managed to enable different types of tasks to happen through our platform. For example, high-value tasks or tasks that repeat very, very frequently. So, addressing those fee models and really making sure that we're listening to our customers and liberating the marketplace liquidity for that is one area which we think is very, very exciting. The second area, which I think is really exciting, is in those repeat bookings. So we have many, many customers who tell us, "Love Airtasker, met someone through the platform.
I wish there was a way that I could keep putting those transactions back through Airtasker, but there are some things that just don't quite work for it yet. For example, the fee model, for example, the way that the communication systems work. So we're really investing into those things, too. So reliability first, fee model second, repeat relationships, third horizon.
Okay. The next question was, does the media partnership dilute shareholder value at the moment of striking the deal? So I'll take that. So, no, we're selling a 20% interest in our UK subsidiary. We own, Airtasker Group owns the other 80%, so there's no dilutive impact for our external shareholders. And over time, that asset will grow in value, creating value for the whole, whole group. Can you talk to how you expand across cities with a country? Does each city require a significant spend and time?
Really, really interesting question with which I could talk about for many hours. Let's take a balanced approach. We believe that when you go into a new marketplace, a new country, you have to build infrastructure and open the platform to that entire country. And what happens there is we start to see people just organically finding Airtasker through things like search engine results, SEO, and through things like PR. To really ignite a city and getting it going, though, we do have to invest upfront capital into performance and paid marketing, as well as investments into the brand via things like media partnerships. That's how we get that marketplace. The country is open, but it's a city to really ignite and be aware of Airtasker to start building those network effects.
What we've seen, though, is really cool, is that there is an overflow effect from those cities into other cities, and a lot of cities, people just sort of start their own Airtasker community. And we're seeing this continue to happen to this very day in Australia. You know, shout out to Airtasker Tweed Heads and, you know, Airtasker Lismore. Great communities that, you know, have really been started by the local residents. So, it's a combination of opening the platform in certain cities and then seeing that propagate across the country.
What is your view of the impact of AI on Airtasker?
One of the things I think is really cool about Airtasker is we're really all about people and connecting people in the real world. And so if you look at, you know, AI and how that might impact Airtasker, fundamentally, Airtasker is about people connecting in the real world. I don't see that being impacted by artificial intelligence, fundamentally in a negative or disruptive way. You know, that'll change again when, you know, there are robots and things like that, which is probably the next frontier of that. That said, there is a lot of ways that AI can have a positive impact on Airtasker. One way is in things like moderation.
So being able to know when people are meeting community guidelines, not meeting community guidelines, and being able to create even greater trust and safety in the community. The second of which I think is really interesting, is taking the friction out of posting a task and describing your task and pricing your task. That's one of the things that, you know, with Airtasker, you've got to be able to know exactly what you want and what the appropriate price is for that. A more conversational AI-type model is a great way to sort of break that friction.
Are there plans to further expand marketing in Australia, in addition to the focus on international markets?
We have a insanely efficient marketing funnel at the moment. In terms of our GMV, our marketing budget in FY 2023 was less than 1% of the total sales that we generated in the Australian market. And so definitely, there are future investments that we could make to scale even further in Australia. I think, you know, there's a balancing equation here, where on one hand, it's great, we're super efficient, we're able to build a very cash generative business, which we're on track to do in FY 2024. But over the long term, we do believe that there is probably a normalization of that marketing budget as a percentage of total sales, and we're probably pretty light in Australia.
We are committed to being cash flow break-even in FY 2024 to demonstrate the profitability of the business, and we're gonna stick to that.
Okay. Could you speak more to the growth plans for the U.S.?
The U.S. market is really in those early stages, and we're focused on the Los Angeles market. At the moment, we're doing a great job of building out that initial traction over there. That said, again, we're being very considerate about capital investment going in there. You know, certainly we respect that the cost of capital has increased massively, and so we're making sure that every single dollar counts. I will say that in the United States, you know, the media partnership strategy is also really, really relevant, and there are some very big media groups in the U.S., you know, whether that's things like Comcast, Warner Bros. Discovery, Disney, or some of the great channels like Univision, that are you know, targeting various niches in the U.S. marketplace.
We are exploring, you know, all of the different options for growth in that country.
Great. Thank you. And then I think, there's a question here on: how does the connection fee model work? Can you provide more details around that?
Sure. So one of the things about the Airtasker model is that previously all the fees were charged at the end of the transaction. What we've done with respect to the Airtasker Connection Fee is we've established a fee that occurs upon connection between the customer and the tasker, and Airtasker earns that fee in an upfront way. And that ensures that every task on our platform is monetized, which is a form of addressing any leakage that was happening through our platform. The other side of the Connection Fee, which is really important, is that for Taskers, it represents a mirror image of the cancellation fee.
If a task is canceled, the Connection Fee amount becomes the cancellation fee amount, and that's a great way to disincentivize, you know, service providers from canceling on the marketplace, and also making sure that customers are more reliable, too.
There's a question here on take rate. Is the take rate still trending higher through, I guess, July, August of FY 2024, and where do you expect the take rate to normalize once GMV momentum returns?
So one of the primary reasons why we're seeing the take rate improve is not just through fee increases or increases in pricing, but also because we're seeing enhanced task completion rates. The more tasks that get completed, the more value that we realize. And so a large proportion of these take rate increases are actually driven by decreasing cancellations, improving quality and outcomes for our customers. We think that, you know, we're obviously in an environment now which is light on demand and very strong on supply. And so I think those two levers could have an impact into the future.
Certainly we see that, the take rate that we have now is not gonna be going down in FY 2024.
Great. Thanks, team. I think this is our last question: There's a strong CAC performance for the Australian marketplace. Can you talk to how that has trended historically, and how is it trending in the new markets? And are you seeing an uptick in organic acquisition as the brand recognition picks up?
Yeah. So, in the new regions, it's very interesting because the CAC to LTV ratio, in a network effect business, almost, is very dynamic. We tend to start out... You know, let's take the example of, trying to, build out a telephone network. The first person that you're trying to sell a telephone to, is very, very difficult to acquire because there's not a lot of value yet in the product. You're the first person with a telephone. Maybe one person has a telephone. It's, it's a very hard, heavy lift to convince that person to spend money and buy a telephone. In fact, you might just give that telephone away, to that person to get it started.
So you start off with a very heavy CAC and a very low LTV because you can't charge a lot to use said telephone. That said, over time, once 10,000 people and your friends and family have telephones, you're like: "Hold on, this is pretty interesting. I'm gonna go and buy a telephone." So your cost of acquisition comes down and, you know, if the telephone network says, "We're gonna charge you ten cents a minute to talk on that phone," you might be like: "Cool. I'll pay for that." And so your LTV starts to increase. Then you get to a stage where you have 20 million people in Australia, or 30 million, you know, phones in Australia, and basically everyone's gotta have a phone. And so you have very low cost of acquisition.
Everyone needs a phone, they're gonna come and buy one, and you have very high LTV because people really need their phones. And it's the same thing with marketplaces. So, where we are in Australia, we've built that network effect, and so we have incredibly low cost customer acquisition costs and incredibly high LTV. Where we are in the United States and the UK are at varying degrees towards that dynamic, and that does require that upfront investment to, you know, get the first 10,000 people using the telephone.
Great. Thanks, Tim. I think that brings our questions to an end. Just want to let everyone know, this webcast is being recorded and will be made available on our website, and you'll be able to access it there. Thank you, everyone.
Amazing. Thanks so much, everyone. Appreciate your time.