The Sharing Economy is a relatively new term in our vernacular. So just what is it and how big is it and how does it affect you? This article is going to explore all that in this Definitive Guide.
Hello World! Hello Sharing Economy! Welcome to their brave new world where everything is turned upside down and inside out! The world is changing with technology facilitating this change and it feels like it’s every increasing.
It is indeed a relatively new term. It goes very well in line with the outsourcing movement, freelancing movement, digital nomadic lifestyle, lifestyle businesses for people to learn how to make money online.
When It All Began
If you look at Google Trends, the term wasn’t even part of our language into as recent as 2013. Take a look at the 10-year Google search chart below:
It’s hovering between 80-100% interest now and it definitely has taken off and now is entrenched into the english language.
But what constitutes the Sharing Economy?
Defining the Sharing Economy (or SE for short)
Probably the first thing you hear when you hear people talk about the “Sharing Economy” is AirBnB. But it’s much more than that as we help explore what it is, what it isn’t and what it is evolving to.
But to be really really sure, let’s define the two words.
Sharing or share from Dictionary.com has this meaning:
Economy from Dictionary.com has this meaning:
Of course, sharing and economy both has multiple connotations and those were the best I’ve found that relates to this context. So what I would say is that the Sharing Economy is defined as such:
“The management of resources in full or part allotted or belonging to an individual or group.”
There’s quite a bit of ‘or’s there so let’s try it again by editing out words and getting to the core:
“The [temporary] allocation of resources in full or in part belonging to an individual or group.”
That seems a bit better. But I find it still a bit wanting. I think we need to explore some concrete examples before we come back to figuring out what the Sharing Economy is.
The Poster Child
The poster child for the sharing economy is AirBnB. AirBnB began when, CEO and Founder Brian Chesky found it hard to find accommodation at a conference he was attending. He decided that others might also have this problem and hosted his first guests in his living room when a conference come to his city.
Brian took this idea and gave it a platform that would eventually become the “Air Bed and Breakfast” that allowed anyone who owed as home space to welcome guests into their living room, private rooms or entire apartments.
AirBnB has since grown into a behemoth, rivalling the number of rooms available (though not exactly an apples to apples comparison) to the Marriott Hotel Chain. The technology of being able to list your space, your availability and prices made it possible to book rooms at your home.
What AirBnB does is that it allows you to “share” your space whenever you want. Going away for a vacation and have the space empty for a week? You can now sub-let your apartment on a short term basis on the platform.
It opened up the possibilities of what you can do with an ASSET that you own during downtimes or when you’re not using it. Essentially, it took advantage of SLACK that was in the economy from a productive ASSET and allowed for the free market to be able to search and find guests to stay. Pretty neat it is.
And with AirBnB’s specific idea, a whole slew of other things came forth.
The Rise of Sharing
With AirBnB’s rise, many other services popped up that allowed for the temporary USE of an ASSET in exchange for money.
DogVacay is one of them. It’s commonly known as the “AirBnB for dogs”. Instead of being able to rent the space to live, people drop off the pets for you to take care of them in your space. So the asset you’re renting out is your time and space to accommodate dogs in your house.
Other Types of Sharing
The idea of share ownership is nothing new and has been around since finance began. Even the term shareholder has the root word share in it, in that you are part owner of this corporation. What is new however is the ability to partake in a obtaining that asset.