The Sharing Economy

by Adam on June 10, 2013

I’ve been hearing a lot of hype recently about the Sharing Economy. Recently, it seems that companies are popping up across the startup ecosystem catering to the idea that people’s unused inventory (whether that be cars, bedrooms or kitchens) can be put to use to generate income for their owners. I think the idea itself, from AirBnB to Zipcar, makes a lot of sense. But, I do wonder why this paradigm is gaining so much attention from entrepreneurs when it’s by no means a new phenomenon.

I don’t pretend to say that the digital landscape has helped the Sharing Economy greatly, but to see entrepreneurs geeking out about the opportunity for this ecosystem as if it hadn’t existed before someone turned the servers on is a bit maddening, as it relates to the overall idea that “the Internet makes everything better.” For instance, AirBnB is indeed a lucrative proposition for those involved, but BnB’s existed long before they started taking off into the Internet ether. Of course, the company has opened up the opportunity for everyday people to offer up their houses, bedrooms and couches to strangers who are looking for a convenient (and usually cheap) place to sleep. But, I think it’s folly for entrepreneurs to think that the Sharing Economy can be subbed in for every possible transactional environment and lead to success.

In food, we’ve seen a variety of these models for kitchen-sharing taking shape that try to capitalize on the idea of taking unused kitchen space and turning it into a social and economic driver. But, the economics (be them financial, social or health-related) around these models are potential challenges for any entrepreneur. A similar story can be seen in the rise (and potential fall) of user-generated content, and the idea that opening up any environment to the masses doesn’t always lead to a better result. The Sharing Economy may be a potential path to the future of entrepreneurship, but it isn’t the only path. And much like every tool in the entrepreneur’s kit, it cannot be applied to everything with the same amount of success.

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