When we have equal access to the digital economy and a virtual bullhorn to strengthen our voices across the globe, this brings up a third concept (following Barrier-free Access and Democratized Egalitarianism) that helps establish the structure for the Digital Age: The Sharing Economy. It is how we can offer our services to the world.
While in the twentieth century, amassing objects— cars, homes, possessions big and small—was a sign of our success, we are now owning less and sharing more: rides, residences, and even work. The Sharing Economy is a model of providing and acquiring goods and services aided by a collaborative, community-based technology platform.
The Sharing Economy brings together resources from around the world to create and deliver goods and amenities, relying on boundaryless, connected communities (Transboundary Communities) as well as the concepts of Barrier-free Access and Democratized Egalitarianism. Skills, resources and capabilities can be shared to develop new products, services and solutions.
From Selling to Renting
Many companies are starting to employ this model. And consumers and sellers are beginning to value access, convenience, and experiences over ownership.[i]
Clothing retailers and car companies, which traditionally have focused on selling and having buyers take possession of their products, are now exploring options for renting and subscriptions. Rent the Runway, Bag Borrow Steal, Chic by Choice, and a number of others are helping change the way we view and obtain clothing and accessories. Need a dress for a special occasion? Rent one online, or get a subscription, and change your wardrobe every month.
Car-related businesses are also joining The Sharing Economy. Peer-to-peer car-sharing site Getaround and local-hosts rental company Turo can get you a car fast and within the means of any budget. And even long-established car companies are getting into the game to service those not looking for a long-term commitment. Cadillac has launched a car subscription service: For $1,500 a month, you can reserve a car via app, and registration, insurance and maintenance are included. Porsche and Volvo have also launched subscription programs.
Bicycles have become part of The Sharing Economy, to help people get from place to place or connect them to public transportation. Cities around the world have bike racks that offer rentable two-wheelers for short trips. More recently, multiple dockless bike-share companies have allowed commuters to rent a bike and leave it at their final destination. China’s version of this bike service, which did not exist a few years ago, has expanded to include more than forty companies, two of which handle more than fifty million riders a day. In 2016, China’s sharing economy generated $500 billion in transactions. It’s forecasted to account for 20 percent of the country’s GDP by 2025.[ii]
In the U.S., The Sharing Economy is estimated to grow to $335 billion by 2025, a major jump from just $14 billion in 2014.[iii]
Communities That Share Talents
Many businesses are already leveraging The Sharing Economy, as communities of workers with diverse strengths split profits, payments or ownership, all while collaborating on a project and having the freedom to commit whatever time they have available.
An example is Hyperloop Transportation Technologies, one of the competitive companies investing in Elon Musk’s visionary Hyperloop system, with the goal of creating a nearly frictionless tube designed to move a pod at high speed, carrying both humans and cargo. What makes this company unique is how it is operating, investing, and growing in this new economy. It perfectly illustrates the emerging nontraditional employment model.
Instead of just creating another big technology corporation, the founders decided to seek out those with expertise in different areas and attract them with shared ownership for their work. People can put in as little as ten hours per week, working on their own time. Their reward: earning equity in the form of stock options. So far, more than eight hundred people have signed on as collaborators, and the project is surging ahead, gathering data and solving problems to bring the Hyperloop to fruition.
This nontraditional employment model is something that all companies will eventually need to address. They will also have to figure out how they can take advantage of it. The Sharing Economy presents a new economic model. The collaborative sharing of talents, products and services is on the rise, and how businesses and governments respond to this new reality will define the new digital economy.
[i] Brooke Masters, “Winners and Losers in The Sharing Economy,” Financial Times, December 28, 2017, https://www.ft.com/content/c97eaa72-eaf8-11e7-bd17-521324c81e23.
[ii] Brook Larmer, “China’s Revealing Spin on the ‘Sharing Economy,’” New York Times, November 5, 2017, https://www.nytimes.com/2017/11/20/ magazine/chinas-revealing-spin-on-the-sharing-economy.html