All about the money?
With that much cash floating around, it’s tempting to get involved. As a customer you can save a packet, but you could make money, too. Not all the cash comes your way, though – the sites take a cut, and you may have to pay tax on the income – but it’s still possible to make a wedge.
One user we spoke to, who wants to remain anonymous, rents a central-London apartment for £2000 (S$4205) a month then sub-lets it on Airbnb. “I make £500 (S$1050) in profit each month,” he explains. “It’s not passive income, but now I’ve been doing it for a while I probably only spend about 20 minutes a day working on it.” That’s an hourly rate of a none-too-shabby £55 (S$115).
He’s not alone in this, either: Airbnb claims the average San Francisco host makes £5600 (S$11,770) a year, while Steven Webb from RelayRides explains that “some power users make upwards of £600 (S$1260) a month.”
The origin of all this success? “It’s been a perfect storm,” explains Anderson. “The sharing economy allowed people to have what they wanted without spending as much during the financial crisis. But at the same time there’s been a resurgent desire to feel part of a community, too.” That’s particularly evident in the UK. “In the US, they’re a much purer breed of capitalist,” muses Ben Pugh, founder of FarmDrop, a site linking food producers to customers, cutting out the supermarkets. “In the UK, we’ve got a streak of left-wing in us.”
His company means producers see more profit and customers get fresher, tastier food, but many sites highlight the UK’s egalitarian streak: Streetclub helps communities pool DIY tasks and tools, while StreetBank lets you share possessions with a neighbour. Neither require money to change hands. “We think financial exchanges take away the natural high you get when you help someone,” explains Sam Stephens, founder of StreetBank. “So we're encouraging people to be generous.”
More after the break...
Cash or otherwise, you might still be worried about dealing with strangers. After all, a woman in the US famously had her apartment trashed by a rogue Airbnb guest in 2011, and some RelayRides and Uber cars have been involved in accidents. “Without a doubt the most critical aspect for all businesses in the sharing economy is establishing trust and safety,” admits Webb, which is why sites offer multiple layers of reassurance.
In some cases, users can be filtered from the get-go — blemished driving licenses make it impossible to sign up to car-sharing sites, say. Then there’s comprehensive insurance and social-network integration, which allows users to identify people. But far and away the most effective system is peer review, where both parties leave each other publicly available feedback. “Both guest and host have a reputation to keep up,” explains Blecharczyk.
This is nothing new, of course – eBay has been using that system for almost 20 years. Though, as Blecharczyk admits, “there are still opportunities to evolve” when it comes to developing trust and safety. Take TrustCloud: a site which measures virtuous online behaviour across social networks and shareconomy sites, then gives you a score that others can judge you on. “Think of it as a trust resume,” explains Xin Chung, its founder and CEO. “An automatically updated record of how online activity reflects how reputable you are.” Maybe time to cut down on those NSFW Reddit Photoshop battles, then.
While the economy has your back, it’s not clear who has its. It is, after all, causing a stir among established companies that fear their turf is being invaded. Whether it’s hoteliers insisting Airbnb should pay extra taxes or taxi companies questioning the legality of lift sharing, there’s no shortage of friction. So far, there have been no major scuffles in the UK, but it’s surely a matter of time. “People don’t care too much about the piece of paper that makes someone commercially licensed,” explains Owens “But they do care about what it stands for: the accountability and transparency.” Over time, both websites and regulators will need to settle on how that’s best enforced.