The Apptrepreneurs won’t save us

The sharing economy has been widely praised, but I wonder if many of the firms are deserving. The Apptrepreneurs promise untold riches of convenience, but do they create value?  Before we print further billions for them, we might want to take a moment to explore exactly what it is that they’re sharing.

I’ve been planning to write something on this for a while, as there are numerous reports of worker exploitation to discuss, but there’s a new development that I wanted to take a look at tonight.  A report from The Verge avers that Uber has been systematically working to muscle out their competition.  I don’t know about you, but that doesn’t sound like sharing to me. In fact, I believe the fake Jeff Jarvis account might be on to something. https://twitter.com/ProfJeffJarvis/status/504366208117145600

To be blunt, the sharing economy often isn’t about sharing.  In fact, the operative word ought to typically be usurping.

Let’s put that idea to the test.  What is Uber sharing?  They’re sharing YOUR CAR.  What about AirBNB?  They’re sharing YOUR HOUSE.

What is Uber sharing? They're sharing YOUR CAR. Click To Tweet

What does this mean?  It’s something I find to be pretty incredible.  They’ve managed to get us to buy and maintain the assets, while they take a tidy fee for coordinating transactions.  Think about it.  They’re running a cab service without buying, maintaining and running cabs.  They’re running hotels without buying, maintaining and running hotels. Hiring, training, benefits? Piff!

They've managed to get us to buy and maintain the assets, while they take a tidy fee for coordinating transactions. Click To Tweet

If we’re talking in terms of profit maximization, then this just might be the most brilliant thing to come along in years, but don’t call that the Sharing Economy.  Call it what it is, usurping.

Fortunately, there’s some good news.  There are real sharing economy firms.  Yerdle is probably the one I’m most familiar with.  They give you the opportunity to share things you no longer use and then to find things which you actually would use.

Flickr/Alan Levine
Flickr/Alan Levine

Did you give up kite surfing after the move to the Midwest?  Offer the gear up on Yerdle and someone who can use it will take it off your hands.  You earn points for the things you provide, and then use then use those points when you find something which you’re in need of.  It’s a pure gift exchange.

Depending on your perspective, value is either created, or at least the unnecessary creation of waste is obviated.  One less thing sitting in a closet pining for use is one less thing being needlessly made.  I find that to be a fair and worthy deal. So there’s the yardstick.  Are the Apptrepreneurs using your stuff to make a quick buck, or is it a true sharing opportunity?  Are they an engorged tick feeding off the corpus of an existing industry, or are they blithely facilitating desired transactions which would otherwise likely not occur?

Expect radical transparency from the sharing economy. Click To Tweet

Ask those questions and I think you’ll have a much better idea of whether it’s really sharing, or whether usurpation is ruling the day.  If it’s the latter, I’d steer clear. Expect radical transparency from the sharing economy.  Find out what you can about the way they treat their “employees,” as well as the competition.  How do the reasons to complaints on social media? And what kind of performance do they have along environmental lines?

Flickr/ryancr
Flickr/ryancr

If you feel good about what you learn, then jump in with both feet. If it seems like they’re playing dirty pool, I’d advise steering clear of their queue.

pablo (3)

Here’s even better news.  There’s no long-term viability for a usurper.  Anyone can hire a team of developers and provide an as good or better tech offering.  The only thing that holds this together is the community.  If people feel they’e being unfairly treated, they’ll jump ship for another service.  And I’m sure it won’t be long before there’s a Kayak or Hotels.com type of meta service which will hit multiple apps and bring back all of the options.  (Do you want the $80 surge pricing ride from Uber, or the $55 ride from Lyft?)

The only way that Uber can sustain it’s current model is to find a way to keep out the competition.  Hence the aforementioned efforts to do just that.  That may allow them to pump up their value for an IPO, but that’s a recipe for look out below over the long haul.

Caveat emptor.

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You’ve schemed more than you have

You’ve borrowed more than you know

Better to steal the crumbs

It makes it easier to go