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Graphic by artist Evan Roth, one of a series of remixed animations discovered on Wikipedia. Learn more about it here.(Courtesy Evan Roth)
Compare the phones you had as a kid to the one in your pocket now. The first was a telephones owned by a monopoly that you used at most only minutes a day. The latter is a smart networked device you refer to hundreds of times. The difference? First, the discovery of excess capacity. Imagine the wasted potential of a smartphones that could only play music and make and receive calls. Second, the creation of a platform. The creators of the mobiles operating systems (Apple and Google, what I think of as INCs) figured out that they made more money when they opened up their rich and sophisticated platforms and allowed app developers to create value. Third, the ability of “Peers” —the small independent ecosystem, usually individuals and small companies — to aggressively scale and share ideas and assets: quirky, crafty, clever developers and users bringing their diverse selves to bear. Today, in less than seven years, we have over two million apps to choose from, and over 2 billion smartphones users.
Peers Inc partnerships are everywhere. The Intercontinental Hotels Group became the world’s largest hotel by spending 65 years buying and building hotels, currently renting over 650,000 rooms across one hundred countries. Airbnb matched their footprint in just four years. Today, Airbnb lists over a million unique locationss in 190 countries. How? They didn’t worry about owning anything, relying instead on empowering individuals to rent their own guest bedrooms and vacant apartments. Their platform harnessed existing idle assets — spare rooms — and gave individual owners the once-heavily-guarded powers of the corporation to rent and profit themselves.
The French startup BlaBlaCar shares long distance car trips, connecting drivers with extra seats and travelers going in the same direction. Unlike its European rail competitors, BlaBlaCar didn’t lay a single track or purchase a single train car. Yet, each month they move 4 million people, the same number as ten thousand trains or ten thousand 747s.
Throughout the last century companies have made money by hoarding stuff: assets, intellectual property, people.
In the new collaborative economy, sharing and networking assets, like platforms, car seats and bedrooms, will always deliver more value faster. Think of the enormous loss of human potential bound up in patents, copyrights, trade secrets, certifications, and credentials. These hallmarks of the old capitalist economy harbor excess capacity just yearning to find the light of day. In the new collaborative economy, innovation is limitless. More minds working together will always be exponentially smarter, more experienced, and more well equipped than fewer ones who work inside a single company or government. In these big and well-organized networks, we can count on the right person (with the necessary skills, networks, insights, and locations) to appear.
Capitalists will tell you that we are driven by self-interest and thus incapable of sharing. But, I think self interest will drive us to share everything.
By using a shared car to satisfy my small demand, I have access to a fleet of 13,000 Zipcars parked in cities across North America and the UK. By adding my tiny insight into Wikipedia, I get the world’s knowledge at my fingertips.
This transition is emotional. Most of us are terrified to let go of any security we have found. The capitalist mantras — hold on to what you have, don’t share, save up — are ingrained. And, this transition is happening amidst considerable challenges and unrest, from climate change, unemployment, and increasing and destabilizing income inequality. Regardless, the collaborative economy is inevitable.
Companies, governments, and people who understand this new “Peers Inc” paradigm won’t build anything else. They will grow faster, learn faster, and adapt faster. The companies and governments that fail to share and connect, will fall farther behind. We are witnessing the end of capitalism as we know it. Nothing can or should hold us back.
In 2000, when I first proposed the idea for Zipcar to investors, their reaction — “You can count on the Swiss to share cars and treat them well, but we are Americans!” — prevented them from seeing the potential of the upside. Sure, a very small minority of Zipcar members will let their ineligible friends drive, or damage the car and not report. But this is a limited and identifiable problem. The benefit is almost one million people sharing and satisfied with only 13,000 cars.
But Peers Inc collaborations also present us with challenges.
They break the old employer-employee work patterns, and with it, the logic behind the last hundred years of tax, work, and social-safety-net laws. This is the tension underlying lawsuits against Uber (and if we are honest, Walmart and Fedex have played the same games). To support a productive, equitable and sustainable economy we need benefits tied to people and not jobs. We need rules that protect individuals from the power of monopoly platforms. We need the resulting incredible productivity gains to be shared by all with a basic citizen’s income.
The good news is that the collaborative economy can address climate change and put people at the center of innovation. We must be proactive to ensure this. Instead of being fearful of unemployment, underemployment, income inequality, and the impending zero-fossil-fuel economy, let’s identify and actively deal with these issues. I know first-hand that the collaboration of people and platforms — Peers Inc — can deliver a better world.
Robin Chase is the co-founder of Zipcar Her new book is Peers Inc: How People & Platforms are Inventing the Collaborative Economy & Reinventing Capitalism. You can buy it here
