Disruptive marketplaces like Airbnb are shifting power away from hierarchies and towards networks of individualsby Serena Kutchinsky / December 12, 2013 / Leave a comment
“The sharing economy is inevitable, because humans cannot survive unless we significantly increase what we share”: Lyft lets users avoid cab fees by sharing cars © Jeff Chiu/AP/Press Association Images
Learning to share was once a key lesson of childhood. Today it’s become a concept at the centre of a fast-growing movement that has taken hold in the wake of the world recession. The “sharing economy” as it’s commonly known, is based on the notion of making a profit from your own under-used resources, turning consumers into providers.
In the age of hyper connectivity, anyone can become a part-time entrepreneur—using the web to rent, sell or swap everything from empty bedrooms to parked cars, second-hand clothes, electronic devices and even skills such as cleaning and baking (pie-making skills are particularly in demand). As social entrepreneur Roo Rogers, who co-authored the definitive book on this topic with Rachel Botsman, What’s Mine Is Yours, explains: “The sharing economy fuses the market need for efficiency and value with consumers’ desire to look at consumption as a personal and holistic experience.”
Leading the charge are peer-to-peer marketplaces such as Airbnb, which allows anyone to rent their property to strangers on a short-term basis, even just for a night—it currently hosts 150,000 people a night and is valued at $1bn. Uber, the leading alternative taxi service which enables users to share rides, has racked up a revenue of £125m for 2013, and Taskrabbit, a hugely successful odd jobs website, reports annual revenue of $30m. In the US, Forbes forecast that sharing economy transactions for 2013 would total $3.5bn, with growth exceeding 25 per cent, while in the UK a new report compiled by YouGov is claiming that participating in the sharing economy could potentially save Britons £12.4bn a year. “I believe we are at the start of a massive paradigm shift away from institutional trust to peer trust,” says Rachel Botsman. “In the 20th century, we built massive top-down organisations, centralised wealth and spent billions on institutional brands that influenced which products and services we thought were good and bad. That is changing. Power, trust and influence is shifting from the centre to networks of individuals.”
But, as we move into 2014, a backlash is brewing. New regulations threaten the core business of companies such as Airbnb. As Jenelle Orsi,…