Will Sharing Replace Buying?

To hear Lisa Gansky tell it, sharing is making a big comeback. In her book, The Mesh: Why the Future of Business Is Sharing, and on her website, Gansky contends it has become much bigger than swapping snippets on Facebook. It is, she insists, a savvy business strategy.

Think about it. Social media and wireless networks allow us to track down almost anything in a matter of minutes. That’s the basis of Gansky’s truism: “Access trumps ownership.” Why buy something you don’t use that often when you can find it when you need it? And if you do own something and aren’t constantly using it, why not make some money during the down time?

Take my car. Please

Take car-sharing. In a TED talk in Detroit earlier this year, Gansky, the Internet-business entrepreneur who started the photo-sharing service that became Kodak Gallery, cited research concluding that, on average, people spend only eight percent of their day using their cars. Even for those pitiable souls who sit in their cars four hours a day, their vehicles are deadbeats the other 20.

Now startups such as RelayRides and Getaround are moving beyond the Zipcar model—it owns the cars that members use—to a different, cooperative approach: the firms connect people who need a car for a few hours to people who are willing to rent their cars out. They operate only in San Francisco and the Boston area for now, but these aren’t just motorized versions of Craigslist. RelayRides, which checks renters’ driving records and has a $1 million insurance policy to cover damages, says its average car owner makes $200 to $300 a month leasing his or her vehicle to others. A few weeks ago, the company announced it has raised $10 million in venture capital, with investors including Google Ventures, August Capital and, yes, Lisa Gansky. (Her investment, made very recently, came after the book, which I view as an account of this business trend rather than a way to promote her investment.)

European car companies are taking sharing seriously. Peugeot now offers free membership in its “Mu” program, which gives people temporary access—at below typical cost—to not only sports cars, vans and cars fitted with bike racks, but also to bikes and electric scooters. Daimler is going a step further. Its Car2Go service, which just added San Diego, keeps growing. Its customers use a mobile app to find the closest available Smart car, gain access through a windshield card reader and a PIN number, then drive away.

Living for the city

If you’re thinking this sharefest is mainly an urban thing, you’d be right. You have to be a bit of a masochist—make that a masochist with money—to own a car in a big city. And what urbanite has room to store a wet vac, a couple of bikes and camping gear you last used when Al Franken was Stuart Smalley? As sustainability guru Alex Steffen pointed out in a TED talk this summer, city folk have a lot more motivation to ask themselves the tough questions, such as, “Do I really need to own a drill?”

But in Lisa Gansky’s vision of the future, the sharing universe spreads to big box stores and suburban malls. Even Walmart will be drawn in, she says. This is hard to imagine when you consider that when a greeter says “Welcome to Walmart,” what he really means is “Buy more stuff.” Yet Gansky envisions a day when the retail behemoth repairs and upgrades products bought there, and when “Walmart Share Club” members have access to daily online auctions of used stuff turned in by other customers trading up.

All meshed up

That may seem a long way off, but the share economy already has footholds in many businesses:

• thredUP: A San Francisco-based firm that’s been described as a “national hand-me-down network.” When kids grow out of clothes, parents can swap for larger sizes.
• Prosper and The Lending Club: Even finance is finding its share niche through “peer-to-peer” lenders. You can be an investor and earn interest on small loans made to other members. Or if your credit score is high enough—at least 640—you can get a loan without the headache of dealing with banks.
• Crushpad: In July, this Sonoma, California, winery launched Crushpad Syndicate, a form of “crowdfunding” that makes it easier for fledgling winemakers to find investors for their own small brands.
• Airbnb: Known for connecting travelers in need of short-term lodging with people with available space, this Silicon Valley outfit just announced it’s expanding into sublets of a month or longer. Recently, after a story about a tenant trashing an apartment went viral, it began providing up to $50,000 in insurance coverage for renters.
• TrustCloud: Apartment-trashers are just the type of people TrustCloud hopes to weed out. If you opt in, it collects your “data exhaust”—the trail you leave through your electronic engagements with others and your comments on Facebook, LinkedIn, Twitter, TripAdvisor, etc.—and gives you a trust rating. Based on your web behavior, it lets the world know you’re a solid online citizen. Or not.

Bonus: Sharing used to be so much simpler.

Be honest. Would you rent your car to a stranger? What about your lawn mower?

Randy Rieland | | READ MORE

Randy Rieland is a digital media strategist and contributing writer in innovations for Smithsonian.com.