The Sharing Economy

If I ask you to rent out your car when you are not using, and make additional money ; perhaps the answer would be ‘no’, at best you would skeptically ask “do these concepts work”?

Getaround.com, a car sharing company in San Francisco, has signed up 10,000 vehicles in less than 2 years! This is becoming reality faster than we imagined! I can name about half a dozen such companies, including Airbnb- which has helped over 4 million people find places since 2008 (2.5m in 2012 alone)
People are listing and sharing everything, bicycles, cars, beds, pie-makers, lawn mowers, vacation kennels for pets.
There are obvious challenges here:
1. Trust: What will make you hand over the keys of a car or home to an unknown person
2. Regulation: If there is an accident in a hired car, who would be responsible? What about insurance?
But despite this the trends are strongly in favor of Sharing Economy. This becomes even more exemplified as GM , zip car, Avis and Relaycar, all make investments and some level of partnerships can be seen among them leading to better integration of this internet model with an offline model
Undoubtedly 2 major triggers for the success of Sharing Economy are:

1. Recession and 2. Facebook

The millenials, post the recession, have become sensitive to owning assets, and facebook are the triggers to allow and boost sharing. Together these trends have made this concept of shared economy possible.

The question that you may ask is if the Sharing Economy is applicable for intangibles also and if so then what are the dynamics? Well that’s a subject for the next post-watch out!

image courtesy: http://hookandmatter.com