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CrowdFlower gets $12.5 million in funding; firm also tries again to settle IC suit

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CrowdFlower gets $12.5 million in funding; firm also tries again to settle IC suit

September 19, 2014

CrowdFlower, a crowd-sourcing platform provider in the online staffing space, received $12.5 million in new funding. Separately, a proposed settlement has been filed in a class action lawsuit where workers sued CrowdFlower claiming they were employees owed minimum wage instead of independent contractors.

The gross settlement represents $585,507, according to court records. Workers who received at least $5 in cash for performing tasks on Amazon Mechanical Turk managed by CrowdFlower will receive between 47 cents and 75 cents for each dollar earned. Names plaintiff Christopher Otey would receive an incentive payment of $6,000, and named plaintiff Mary Greth will receive a service payment of $5,000.

A previous motion to settle the case was rejected by the court on April 15, according to court records. The new settlement is coming for approval next month. The suit is Otey et al v. CrowdFlower Inc. et al; it was filed in the Northern District of California.

Crowdsourcing websites take on large data-driven tasks that require human judgments — such as verifying lists of business addresses — and breaks them down into small microtasks. Those are then farmed out to millions of Web users. The Web users then make the “judgments,” receiving a small amount of money or online gaming virtual credits for each judgment.

The $12.5 million in funding announced this week was led by Canvas Venture Fund, a venture capital firm based in Menlo Park, Calif. Existing investors Bessemer Venture Partners and Trinity Ventures also participated in the round.

The investment brings the total amount raised by the company to $28 million and will help the company support its growth. As part of the latest funding round, Rebecca Lynn, general partner of Canvas, joined the board.

“Having worked at P&G where every product and brand strategy is based on exhaustive analysis of data, I naturally gravitated to CrowdFlower’s vision to help companies realize the real potential of Big Data,” Lynn said. “CrowdFlower’s platform takes the pain out of managing an on-demand workforce to deliver accurate and fast results so that organizations can base their important business decisions on data they can trust.”