Economic Insights

Part
01
of three
Part
01

1099 Demographics

The majority of 1099 (independent) workers in the United States in 2017 were between the ages of 21 and 27. The average annual income for all 1099 workers, regardless of age, was $65,300, and most of them (more than 4.2 million) were married. Details on these findings and how we arrived at them are below.

Methodology

Because the 1099 workforce, also called the gig economy, fluctuates quickly and lacks a standard definition of what constitutes an independent contractor across government agencies, "there is little government data about people who make their living freelancing."
Therefore, our research had to be gleaned from private sources.

We found clear evidence of the breakdown of the age and average annual income of 1099 workers in the 2017 MBO Partners State of Independence report. MBO Partners is an organization dedicated to serving the business needs of independent contractors. We then triangulated data from the US Bureau of Labor Statistics and Nation1099, a web publication for 1099 workers, to determine the breakdown of their marital status. (For details on this triangulation, please see the section on Marital Status below.)

Age breakdown

According the 2017 MBO Partners State of Independence report,
38 percent of the full-time independent workforce in the US last year were Millennials, or people age 21–37 years old. This represents 15.5 million people. Baby Boomers (53–72 years old) and Matures (72+ years old) were close behind, at 35 percent. This represents 14.3 million people. The remaining 27 percent, or 11 million people, were from Generation X (38–52 years old).

Income Breakdown

The same report tells us that the average income for 1099 workers last year was $65,300. Millenials earned roughly $43,800, on average, while Baby Boomers and Matures collectively earned an average of $77,000. Approximately 1 out of 5 full-time independent workers made more than $100,000.

Marital Status Breakdown

Despite extensive research, no pre-compiled data on the marital status of 1099 workers could be found. Here are the steps we took to determine this information.

The US Bureau of Labor Statistics reported that 1099 workers made up 11% of the total population, and that the total number of married people (spouse present) in the population was 38,866,000. Using the calculation: 38,866,000 x .11 = 4,275,260, we determined the number of married 1099 workers to be 4,275,260.

The Bureau also reported the number of Americans with "Other" marital status (i.e., never married, widowed, divorced, etc.) at 11,374,000. Using the same calculation, we determined there were 1,251,140 independent workers who fell outside the married (spouse present) designation.

Conclusion

While the government has difficulty thoroughly and accurately reporting the number of 1099 workers in America, outside agencies such as MBO Partners and Nation1099 are working to fix the data gaps that make this research difficult. We can say with certainty, however, that in 2017, the majority of this workforce were young, married people, and collectively, they all earned approximately $65,300 last year.
Part
02
of three
Part
02

Average US Worker Demographics

This response focuses on providing the breakdown of age and marital status of US Taxpayers who have household incomes around and just below the national average. The average household income in the United States is $73,298 in 2014, the latest year it compiled. You will find a deep dive of my research findings, as well as how I came to this conclusion.

The average household income according to age

The first thing we will look at is the breakdown of the average household income according to the age. When looking at the age, we will look at those who are earning around the average household income which could be slightly above or below that amount. Since the average household income is $73,298, we will look at those who have an average household income between $70,000 and $74,999.
When looking at the data, there are 2,972,000 million Americans under the age of 65 who have an average income of $70,000 to $74,999, which is at or around the average household income. To break it down even further, there are 173,000 Americans between ages 15 to 24 who have an average income of $70,000 to $74,999, which is at or around the average household income. There are 713,000 Americans between ages 25 to 34 who have an average income of $70,000 to $74,999, which is at or around the average household income. There are 652,000 Americans between ages 35 to 44 who have an average income of $70,000 to $74,999, which is at or around the average household income. 737,000 Americans between ages 45 to 54 who have an average income of $70,000 to $74,999, which is at or around the average household income. There are 696,000 Americans between ages 55 to 64 who have an average income of $70,000 to $74,999, which is at or around the average household income.
Moreover, when looking at the data, there are 802,000 thousand Americans ages 65 and over whom have an average income of $70,000 to $74,999, which is at or around the average household income. To break it down even further, there are 490,000 Americans between ages 65 to 74 who have an average income of $70,000 to $74,999, which is at or around the average household income. There are 313,000 Americans between ages 75 and over whom have an average income of $70,000 to $74,999, which is at or around the average household income.

The average household income according to marital status

Another thing we will look at is the breakdown of the average household income according to marital status. When looking at the marital status we will look at those who are earning around the average household income which could be slightly above or below that amount. Since the average household income is $73,298, will look at those who have an average household income between $70,000 and $74,999.
When looking at the data, there are 2,085,000 million married Americans who have an average income of $70,000 to $74,999, which is at or around the average household income. When only assuming there is no spouse present, 223,000 married male householders, and 416,000 female householders have an average income of $70,000 to $74,999, which is at or around the average household income.
Moreover, we will look at data for those who are single (not married). There are 538,000 single male householders who have an average income of $70,000 to $74,999, which is at or around the average household income. There are 512,000 single female householders who have an average income of $70,000 to $74,999, which is at or around the average household income. When only assuming they are living alone (not with partner, parents, friends, etc.), 367,000 single male householders and 384,000 female householders have an average income of $70,000 to $74,999, which is at or around the average household income.

Conclusion

There is data that shows the breakdown of the average household incomes according to age and marital status. The average household income in the United States is $73,298 in 2014, the latest year it was compiled. From there we can find a wide variety of ways to interpret that data by who has income that is at or around the national average, which is those who earn anywhere between $70,000 and $74,000. We can break down those age brackets for those who are under 65 year of age and those who are 65 and older. In addition, we can breakdown martial states by all married males and female householders and go further by all married male and female householders who are not living together. Finally, we can look at single (not married) male and female and break it down to those who are living alone (not with partner, parents, friends, etc.).
Part
03
of three
Part
03

Next Door Growth Factors

OVERVIEW

NextDoor has experienced dramatic growth since it's inception in 2011 and attributes much of the initial growth to referrals, investors and advertising. The company's value proposition is based on communicating easily and effectively with neighbors. Their product-market fit consists of communities, families and anyone in a neighborhood setting seeking to familiarize themselves with those who live in surrounding areas.

GROWTH STRATEGIES

In 2012, NextDoor consisted of about 7,000 neighborhood groups, compared to the almost 200,000 using the service today. The process of growth since inception has been a much slower and more refined development compared with popular social media sites like Facebook and Twitter.

The first year of Next Door's operations consisted of calling every potential home, and even visiting the residents in person. They were able to bring 175 neighborhoods on board during this time. NextDoor also relied heavily on referrals. As more communities joined the service, gaps within the database revealed which neighbors were missing. Users were able to click on the missing houses on a map of their neighborhood, prompting NextDoor to send physical invitations in the mail.
Investors became interested as NextDoor began to grow, and paired with the introduction of advertisements, the company was able to expand to the UK in 2016. The company soon spread to 160,000 neighborhoods across the US, UK and Netherlands. NextDoor experienced 100% growth each year, ultimately comprising 75% of all U.S. neighborhoods.

The company has raised over $210 million in funding and was last valued at $1.1 billion. The company is now opening operations in Germany, and has received many monetary offers since announcing the desire to move to Asia and Latin America.

PRODUCT-MARKET FIT

NextDoor provides service for communities to share information. The main appeal to this market consists of ease of communication with neighbors. Data suggests about 30% of American residents can’t name a single neighbor. By implementing this service and allowing referrals, NextDoor can connect neighborhoods while growing as a service.

The service requires name and address verification to sign up. Compared to most other social media sites which promote anonymity, NextDoor creates an environment of honesty and security for communities. The service appeals to users much differently than current social media platforms, because of the higher levels of interaction between familiar identities which lack the typical social media incentives such as favorites and retweets.

Families with children and those moving into new neighborhoods benefit greatly from NextDoor. The service allows these families to safeguard their children, and for new residents to instantly connect with their new neighbors.

APPROACH TO SUCCESS AND VALUE PROPOSITION

NextDoor founder Nirav Tolia says one of the most important elements of Nextdoor’s success existed within the company’s "ability to devote crucial time to the initial process of appealing to households, regardless of whether the method is scalable." To Tolia, the tactics used during start-ups may not scale, but it was imperative to confirm that the idea itself is working.

Tolia stresses that surrounding yourself with the best people is a major key to success. He maintained as much contact as possible with people possessing common goals and strong work ethics. He also says that thinking long-term is essential for any major project, especially In order to reach Nextdoor’s goal of connecting every household in the country.

The CEO also advises that failing constantly is not enough to reach success. According to Tolia, it's more important to take away knowledge from those failures and apply them to next effort, evident in the changes made from his first failed project called Fanbase.

This long-term mindset also lays the foundation for the value of the service instilled upon the users. By spending the first year fully developing a great user experience and referral system, the company was able to scale operations while neighbors connected with one another and became a closer community.
Safety is also a major value proposition for users. Nextdoor became well-known as a forum where neighbors could report suspicious activity in their communities. This not only creates an even deeper sense of community interaction but also allows users to feel that Nextdoor has provides a type of security.

CONCLUSION

NextDoor has experienced tremendous growth since its creation six years ago. The company attributes this growth to referrals, investors and advertising. NextDoor understands its market-fit and appeals to families and communities by offering security and communication services. The success according to CEO Nirav Tolia comes from surrounding his company with like-minded and hardworking individuals, while spending adequate time on initial startup and learning from failures.
Sources
Sources