Website micro services provider, Elto, is shutting down for now

Elto, formerly Tweaky, is a micro services provider, for lack of a better term. They started with $25 tweaks, which until they shut down services today, worked it's way to a $199 minimum.

WordPress is a high focus vertical for Elto's, and I presume it's their largest as well. Elto is one of several such providers of micro services like this; others still running are Codeable and Envato Studio (formerly Microlancer). These are besides the longstanding generic types (with rather poor reputations, in my opinion) such as oDesk and Elance.

I have always kept track of Elto, as I started referring folks to them from my own contact form for small projects, in order to narrow the leads I was getting. When I got the email today from Ned Dwyer, Elto's founder, I went to my dashboard to see how many folks had used my referral and what those services were:
elto-services

In the time I was referring folks to Elto, I sent them nearly $2,000 in business and got a 25% referral fee. That's not a lot; more interesting is that of these referrals, there was an 8.5 / 10 satisfaction rate. I wouldn't say that's outstanding, but it's not bad either. It's probably better or close to the satisfaction of more traditional web services providers.

I emailed Ned to see if he could offer any more insight into this decision. He responded with the following:

It was something we thought long and hard about before making this change.

The challenge is that the current model was working well – customers rate us on average 8.7 out of 10, thousands of new customers every month etc – but it wasn't delivering the kinds of results we wanted. This will become clearer when we launch the new version.

While we could have kept going with this model while working on the next version in the background, the current model has significant customer support challenges. This puts a burden on our team to maintain the current app and customer base which draws resources away from us working on what's important.

We have the full support of our team and investors in making these changes and we're excited about what's next.

So it appears that this is a temporary stop for Elto. I'm sure — with investors to answer to — rising support challenges makes change inevitable.

I've always liked the idea of companies like Elto from a developer standpoint. As long as the company values the developers they are mediating for, it can be a nice way for junior developers or just folks that don't want to interact with clients much to be able to get work. It can also be a way to fill in the gaps in someone's own freelance work.

I'm not sure what the next version of Elto will look like, but it seems they're aiming to be more in the product business and less in the service business.

From what I can gather, they raised at least a seed round in 2012, reported at $460,000, and perhaps another round in 2013 from Blackbird Ventures.

I guess my primary takeaway from a change like this is that even when companies are productizing services, doing work for cheap isn't easy. Support struggles, maintaining customer expectations, managing developers — it's all tough. I am curious if Codeable and other what I'd call “progressive” members of this style market can relate to Elto's struggles, or if they have somehow managed to get past those.

For some additional reading on Elto's journey, Ned's post about what they learned in their first two years was insightful. He also hints they considered a pause even then; so I guess today shouldn't be too much of a surprise.