Infographic by Collaborative Consumption. See the full size version here.
The Collaborative Home is an infographic by Collaborative Consumption that visualizes the many assets in our homes that can be shared or swapped for profit. Created in partnership with the Collaborative Fund and Start-Up America, the infographic draws attention to a number of Shareable’s favorite collaborative consumption startups, including AirBnB, Neighborgoods, Swap.com and RelayRides. It also illustrates the sort of money that users stand to make with some stunning statistics, including:
- Average amount that a New Yorker makes renting their space on AirBnB: $21,000
- Amount the average user makes on Rentoid renting out their gaming systems: $200
- Average amount made by Relayride’s frequent renters: $8,931
Of course, while infographics like these serve as effective viral marketing, they don’t tell the whole story. Focusing on the profit that users can reap from collaborative consumption makes for a good sales pitch, and these sort of numbers are convincing. But profit should not be the only benefit touted. To create lasting and significant change, the sharing economy must be more than another form of “happy capitalism”.
The sharing economy can make users some needed cash, and in an economy like this, you can’t ignore the potential impact of that. But when collaborative consumption frames relationships as ways to make money, we’re back to square one. Instead of corporations commodifying relationships, we’ll be doing the commodifying—small micro-corporate nodes in a retrofitted yet fundamentally flawed system.
The sharing economy is about more than transactions: it’s an opportunity to collaborate, and to borrow some words from Craig Newmark, “give each other a break”. It’s a way of diversifying income while building resilience and keeping money in your local economy. It extends the life cycle of products and lessens the burden of ownership. It builds social capital and fosters a collaborative mindset among citizens. And last but not least, it engenders better relationships among individuals and encourages new experiences. There’s a reason that AirBnB pitches their service with the tagline “travel like a human”.
Focusing on the profit motive reduces the scope of the sharing economy, from a transformative cultural movement to an easy way to make a quick buck. Sharing isn’t just a way to make startups profit and build a new economy of micro-entrepreneurs—it’s a cultural movement that has the power to build community, engagement and a new, more sustainable peer-to-peer economy, transforming how we define our interpersonal relationships in the process.
Comments
Spencer Hale wrote on 07.20.11, 1:56pm:
A sharing economy could mean more less bankruptcies. Either way there is a lot of progress to be made.
Dan Gooden wrote on 07.20.11, 8:29pm:
I've wondered if framing it as collaborative "consumption", or the sharing "economy", rather than just "sharing" has actually led to the framing of this movement as an economic one, rather than one that is based around human values of sharing and gifting?
Juho Makkonen wrote on 07.21.11, 12:05am:
An excellent article! When the collaborative consumption services are becoming more and more interesting to VCs, there seems to be more talk about the money and less about the social and environmental aspects, and there's something about it that doesn't feel quite right.
On the other hand, if we think about the end result, all this talk about the money might still be a good thing for the people and for the planet.
When we interviewed people that use Kassi, we have found that many of them start using the service solely because they need money or stuff, so they start from buying or selling. But then something strange happens. After they've sold their couch to the neighbor next door, they suddenly start greeting them in the staircase. And when they are browsing the service to find a schoolbook, they notice that someone needs assistance with a computer and decide to help. After the computer is fixed, the two might have a cup of coffee and a good talk.
Finally these people are at a point where they start to list some of their tools in the service for others to borrow, for no cost. Step by step, they form bonds to their neighbors and start sharing more and more, and think less about the money, even when it was the sole original motivator.
Our goal has always been to make sharing as easy as possible. By this I do not mean just UI-related factors, but also social aspects. People need to have the right mindset to share, and frankly, most people currently don't have it. They are just not yet ready for it, it seems emotionally too difficult. In those cases it does not necessarily help to talk them about how they can get to meet new people and save the environment. They are interested in those things, in theory, but just a bit lazy to do anything if those things are the only motivation. So it helps a great deal if you're able to lure them in with the offering of saving or earning money. All the good stuff comes in on the side.
Imran ponders whether these companies should be non-profits instead of companies. There is also something in between those two options: social entrepreneurship. http://en.wikipedia.org/wiki/Social_entrepreneurship In it you are able to make money (making money simply makes it easier to scale your operations), but it is not the only goal of your company. Instead, social enterprises set out to solve the most difficult problems of the world. I think this model is ideal for the sharing economy services.
The extremes are not usually good, the best path lies somewhere in the middle. Sharing economy is not and should not be all about the money, but nor should it be viewed by the masses as a "hippie movement". After all, the best situation is if everyone uses these services, even those who are not at all interested in saving the world or communicating with strangers. Hopefully in ten years we do not have to have the term "sharing economy" at all, because sharing is simply an intrinsic part of our economy.
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Juho is a Co-Founder and CEO of Sharetribe, a platform for creating custom peer-to-peer marketplaces. http://www.sharetribe.com
Antti Virolainen wrote on 07.21.11, 12:48am:
Good post and insightful comments! I think Airbnb is a good example of a case where more "hippie" services have been existing for many years (e.g. http://couchsurfing.org and http://hospitalityclub.org) and gathered large groups of enthusiastic users. Airbnb offered a possibility to earn money with similar activity and another big group of people has got interested to share space in their apartments.
As Imran and Juho said, people are different and their motivations to share vary. I think it's good if the sharing service scene can offer possibilities to different minds.
Of course we could ask that does the paid sharing cause a threat to the free sharing... In some cases it might weaken the motivation to share for free if others are making money with similar sharing. But still I think the benefits to the sharing culture are bigger than the threats.
Mira Luna wrote on 07.28.11, 11:28pm:
Money is an extremely limited way of measuring wealth and happiness and can even be an inverse indicator. We need indicators of these sharing tactics that measure happiness, growth in number of quality and quantity of relationships, social harmony, personal and environmental health. I think the sharing economy is about growing other forms of wealth through connection, relationship. If we can start thinking in these terms, we might focus our energy on different tactics for growing the diverse sharing economy and even more holistic visions and approaches to growing these sharing biz start-ups.
Jeff Bennett wrote on 08.23.11, 1:50pm:
I really enjoyed this post and the comments that have been added. As a practitioner in the swapping and sharing space, I thought I would add some additional perspective.
Full disclosure, I am an entrepreneur who is deeply committed to building a business. It is key that every business needs to grow customers, engagement and deploy a model that enables sustainability. Even non-profits need to determine the right approach so they can raise the capital through endowments or annual giving to become sustainable.
I have been involved in this space for a couple of years now through my leadership of Swap.com. I have a responsibility to our community...our employees and our investors. I take this responsibility seriously. As part of this our team has worked diligently to connect with our community to expand of services and platform. As part of this we have also worked to create sources of revenue that would enable sustainability. This is a very tricky dynamic in this market space for many reasons. First if you look at the real world implementations of swapping and sharing, there is no fees charged for it. Friends and neighbors connect and swap and share. Second there is value that a market maker brings to the table in the form of enhancing this age old behavior by forming a trusted network that has more liquidity for swapping and sharing. Third, despite the contribution of the platform provider, every community member must participate to enable this liquidity... listing their haves and wants...so it is not a traditional b2c model where the platform can just charge for it.
Value must be provided to attract, grow and sustain a community. Due to the fact that these activities in the real world are free though there is no real way to charge everyone to play...or they wont participate. This is intuitive and we have confirmed this intuition in our work with the Swap.com community. I have the scars to prove it. The only way is to look at value added services that are beneficial to some of the community members...not mandated... and thus the platform provider can earn some type of fee base.
There is not a one size fits all to this. Achieving success will mandate that a proper focus and balance is found though.
I contend that there is a massive opportunity to serve this highly fragmented, social and local activity of swapping and sharing. As we continue forward at Swap.com we will continue to be mindful, respectful and in tune with the needs and realities of our community to keep in balance the value that is provided and earned. With this focus I am certain that a win win can be created...and scale can be achieved.
Onward!
Neal Gorenflo wrote on 08.23.11, 6:15pm:
Thanks Jeff from a thoughtful response. I definitely agree that social enterprises need to find sustainable sources of support. I think that anytime any enterprise focuses too much on profit or any one factor, that's going to have negative consequences long term, so finding balance is important. I believe that whether for profit or nonprofit, that being purpose driven and truly caring for people is essential for the long-term viability of any enterprise. Talent and customers are attracted to shining cities on the hill. Support of all types, including financial, follow from the wise strategy and moral calling of caring about people. I definitely see this in you and your enterprise, and I hope Swap.com becomes an example like Zappos. You're already headed in that direction with your school program and your on the ground organizing of swap meets.
JB wrote on 10.20.11, 1:08pm:
The concept of Collaborative Consumption is relatively new to me, but what captures my imagination about it are the potential philanthropic applications. http://webthriftstore.com interests me because it creates a dynamic that introduces charities, consumers, and buyers. Do you know of similar startups? What would you say are the standouts who operate in order to support charity?
I recently posted a question on Quora asking if the new sharing economy p2p sites should be structured as not-for-profit in order to deliver what people want rather than what shareholders demand. I suppose it comes doen to how much autonomy company executives have over the running of the business...general rule of thumb is the moe shareholder the less autonomy to what right rather than whats profitable.
Will the CC movement become an extension of the old economy made up of VC and corp finance? Its possible but those of us charged with delivering these platforms should deliver what we set out to and not 'sell out'.
From the perspective of the end user the motivation to engage with such platforms is varied and complex. Just like there are some of us who are vegetarian but eat fish but not meat , or don't eat meat at all, or don't touch diary products there are degrees to which people buy into the sharing ideals. We all lie somewhere on the scales of socialism and capitalism...viva le difference.