10 Signs Web-Based Sharing Is Reaching a Tipping Point


While the concept of using the web to share “stuff” — from cars to apartments to tools — is still relatively new to many consumers, the business model is being adopted by a growing number of companies and I think has started to reach a tipping point and become more of a mainstream concept.

So-called collaborative consumption has also started to make some companies a significant amount of money. Here are 10 signs I’ve seen that a web-based sharing economy is movin’ into the mainstream:

1. Airbnb $1 Billion Valuation. The peer-to-peer apartment and house rental startup Airbnb is reportedly raising a $100 million (or more) sized round, at a $1 billion-plus valuation, led by Andreessen Horowitz. Previously, the Y-Combinator company had only raised $7.8 million. No doubt such a large leap in funding will help the company grow rapidly, and continue to bring in more users beyond the early adopter crowd.

2. Zipcar’s IPO. In mid-April, car sharing company Zipcar debuted on the Nasdaq at an eye-opening $30 per share, up over 60 percent from its offering price of $18. The company’s stock is trading around $25 at last close. Zipcar has been growing its business over the past decade, but decided this was the year investors would embrace the IPO. They were right.

3. New Innovative Startups Emerging. It seems like new websites using this type of business model are emerging on a regular basis. Baby clothing swap site thredUP launched in April 2010 and has been growing its business well ever since. Neighborgoods is another newish site organized around finding objects for rent via neighborhoods and locations, instead of around specific items. Toygaroo is like the Netflix for kids toys, where parents can rent toys for use, and then return them, and get new ones.

4. Neighbor-to-Neighbor Car Rental Competition. The idea for neighbor-to-neighbor car renting (car sharing 2.0) was such a hot concept there are now at least three companies angling to build the still tiny market. Getaround launched nationwide last week (and won an award from Tech Crunch ), RelayRides has been growing its site with funding from Google Ventures  and August Capital. And Spride Share, working with tech from City Car Share, launched in September 2010.

5. Attention Outside of Early Adopters. ThredUP has managed to attract a user base of people who tend to live their lives well outside the tech industry echo chamber, CEO James Reinhart explained to us recently. And that’s the main thing that Reinhart attributes to the success of the web site.

6. It’s the Economy, Stupid. One of the reasons these types of websites are becoming more popular is because the weak economy has led consumers to look to cut out buying and owning expensive goods — like a car, or a tool that they only use once. When times are tough, why not turn to the web to rent it? That’s definitely a mainstream consumer concept.

7. Winning Web Reputation Tools. Enabling an average user to feel comfortable renting out their car to someone in their neighborhood, or convincing someone that it’s a good idea to stay in an apartment owned by a stranger, is hinged on web-based reputation tools. These reputation tools have become better and better over the years, and pioneers like Yelp, Amazon and Netflix have made peer reviews an artform. Sites like Airbnb are able to tap into that established ecosystem and level of comfort.

8. Pundits-n-Books. Any time a trend starts to break into the mainstream, there’s always a wealth of books written on the topic to guide the way. Here are two: What’s Mine Is Yours: The Rise of Collaborative Consumption, and The Mesh.

9. Ashton Kutcher. Last week, celebrity Ashton Kutcher disclosed he had invested in Airbnb. It’s Ashton Kutcher. He helped make Twitter more mainstream. Just associating his name with Airbnb kicks it officially out of Silicon Valley.

10. Car Sharing Is the Gateway. Car-sharing is the gateway drug of the growing trend, and according to a report from research firm Latitude called The Sharing Economy, people who try out car-sharing services are more likely to join in other web-based sharing services. Car sharers also share significantly more across categories than non-car sharers.

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