Sharing Economy

Pathways to inclusive entrepreneurship and growth Edinburgh, Scotland January 2016

http://www.slideshare.net/eteigland

Uber • Launched June 2010 • 300 cities in 58 countries • Limited physical assets • USD 60 bln valuation (Ericsson – USD 32 bln) Exponential growth by “doing more with less”

A system that activates the untapped value of all kinds of assets through models and marketplaces that enable greater efficiency and access. - Botsman The Sharing Economy Harvard Business Review, 2014 The Sharing Economy: Embracing Change with Caution http://www.slideshare.net/eteigland/sharing-economy-webb

The Sharing Economy is enabled through peer-to-peer (P2P) transactions on multi-sided platforms (MSPs) http://sloanreview.mit.edu/article/strategic-decisions-for-multisided-platforms/

“Sharing” is big business… http://www.web-strategist.com/blog/2015/06/04/the-collaborative-sharing-economy-has-created-17-billion-dollar-companies-and- 10-unicorns/ USD 26 bln today -> USD 335 in 2025

Increasing efforts to regulate the sharing economy

If Uber were to pay drivers as employees in USA.

Spawning a new form of capitalism - Modern day sweatshops? Digital Robber Barons? “Monopoly” platform “Monopoly” platform “Perfect competition” “Perfect competition”

Jobs vs Gigs

LEARNING p2p learning open courses & moocs PRODUCTION co-design / co-innovationdigital peer production distributed fabrication (makers) FINANCE p2p funding p2p payments p2p insurance compl. currencies GOVERNANCE SWARM participatory organizations participatory government blockchain / DAO CONSUMPTION redistribution local food systemsproduct-service on-demand services COLLABORATIVE ECONOMY FRAMEWORK V0.1

Banking is essential, but banks are not. Bill Gates

Four forms of crowdfunding Form Benefits for funders Donation- based Donation Intangible benefits. Reward- based Donation or pre- purchase Rewards in addition to intangible benefits. Equity-based Investment Return on investment if company does well. Rewards sometimes also offered and intangible benefits may motivate too. Loan-based Loan Repayment of loan with interest. Alternatively intangible benefits if loan given interest-

Crowdfunding growth 2012-2015 USD 34 bln E

zopa

But in China alone in 2015… http://www.crowdfundinsider.com/2016/01/79612-report-china-p2p-lending-topped-150-billion-in-2015/

Democratizing innovation through access to capital?

Democratizing innovation through access to capital?  Women in USA  <30% of business owners  <15% of angel investors  <10% of venture capitalists Marom, Robb and Sade 2014  Women on Kickstarter  35% of project leaders  44% of investors  Women invested in women project leaders (>40% of projects) VS

Following regulations…  EU/EEA  No country can require a prospectus for round of <100,000 EUR  For round of >5 million EUR an EU prospectus is always required  In Sweden  Limit is 2.5 million EUR without a prospectus  Less than 150 ‘non-qualified’ investors without a prospectus  ALSO shares in non-publicly traded companies cannot be advertised in Sweden

Increasing forces for local community

Toborrow.se

Hoffice – a Swedish concept gone global US: 40% of workforce freelancers

A number of bottom-up collaboratives

Scheveningen Harbor – The Hague

Moving into hardware: A 3D printer workshop on Lisette’s boat RepRap community E-commerce

Local networks of 3D printers

Developing circular economies Local demands? Local materials? Reduced transport?

Thomas Jefferson (1816) “Laws and institutions must go hand in hand with the progress of the human mind.” The problem is that the human mind itself can’t keep pace with the advances that computers are enabling. http://wadhwa.com/2014/04/15/mit-technology-review-laws-and-ethics-cant-keep-pace-with-technology/

The challenge of ensuring trust Leap of faith when meeting strangers -> Increased trust in society? Innovation is forward looking while regulations are backward looking. http://www.weforum.org/sessions/summary/rise-demand-economy

Challenges in the Sharing Economy  Ensuring trust − In the platform, other users, products and services, financial transactions?  Regulatory − What is “employment”?  Security, taxation − What are new “rules” around “consumption”?  Taxation, safety, big data and privacy, IP and ownership  Economic implications − New pricing mechanisms -> deflation? − Lower demand for capital in “Zero Marginal Cost Society”? − Net effect on labor productivity?

Scenarios for 2020 http://www.slideshare.net/eteigland/sharing-economy-webb

Four scenarios for 2020 High Tech Adoption Global Recession Global Growth Internet of Space • Differentiated SE platforms •Attraction of talent •Test market •Focus on privacy and integrity •Transitioning industries Freelance Economy • Differentiated SE platforms • High tech skills “exported” • Expansive crowdfunding • Neo-sharing • “De-urbanization” Business as Usual •Limited SE platforms •Neo-sharers •Steady growth in freelancing •Crowdfunding Shadow Economy •TaskRunner society •Vast urbanization •Monopoly SE platforms •Barter economy Low Tech Adoption

Robin Teigland robin.teigland@hhs.se www.slideshare.net/eteigland @robin.teigland If you love knowledge, set it free… If you like this presentation and would like to contribute to our research, we accept bitcoins: 14hs4JbnQLXE87GGzu84uXGaspmxmnLpwC. Thank you!!!!!