I don't think "penny dreadful" is that likely, but continuing...

I don't think "penny dreadful" is that likely, but continuing stagnation is. The definition of insanity is doing the same thing and expecting different results. FLN has been trying the same strategy over the years to mediocre effect:

1. Purchasing unrelated companies and diverting energy into side projects
2. A weak corporate governance model (2 insiders on a board of 3, with 1 being the CEO's long term associates from earlier ventures)
3. Weak management - as I've often said here - aside from specialists in compliance/law/accounting, the key management personnel are inexperienced people quickly promoted from within FLN and just as quickly discarded. It's MB plus a bunch of non-entities.
4. Lack of willingness to take risks - to raise capital or spend cash on expanding the core business operations. This risk aversion is related to point 1: It's a lot easier to splash out on some semi-related company and double a tiny amount of revenue than it is to improve a core business function. The cheap wins obtained by subsidizing Escrow for years or buying the companies that make up Freightlancer need to be put in this perspective: this was money and energy not put into growing the core business. Similarly, the risk aversion shows up in points 2/3 and the incredibly concentrated cap table.

The problem is that the high ground in online freelancing has been captured by FVRR/UPWK. These guys have done the equivalent of the Mariel Boat Lift, where the Cubans emptied out their jails and mental asylums in the 80s and put them on boats to Miami. In a similar way, they purged their weaker freelancers, inflicting them on FLN.

I always thought FLN could push up the hierarchy if they just trimmed their take rate and got rid of some of the more predatory practices, but they're now in a position where the quality of their product is markedly worse than their competitors and incremental work is not gong to do it. The level of reinvention required now will not be easy, especially given the timidity of the company and its broken governance/management.