See the original Honeycomb graphic, which spurred this “Day in the life” graphic.
Data shows collaboration in the new economy is accelerating.
People are crowdfunding, making, sharing, collaborating, all kinds of their things in life. Some are getting food on-demand, rather than going to traditional grocery stores or restaurants. The world is speeding up, and people are transacting between each other, or rapid-delivery services. We expect this to continue to accelerate as the funding from VCs dwarfs many markets, adoption rates are doubling, and the media has endless coverage over this collaborative movement. To help make sense of this dizzying environment, we attempted to take a snapshot of this world in motion, to try to find out what a single day comprises of.
Infographic: A Day in the Life of the Collaborative Economy (Ver 1.2)
Data Methodology and Sources
Data was aggregated from online sources, first, then in many cases, I asked for clarification from startups contacts that I know. All data was from 2013-2014 sources. Only four of the eighteen sources are from 2013. Some companies declined to provide data, or it wasn’t listed, therefore we did not include. In many cases, data was annual, or monthly, and we divided to find out an average daily rate. In many cases, companies would not provide a daily rate, so we had to conduct this exercise on our own.
- Adoption Data: (far right column)
- Lyft: From email discussion with company
- Uber: GQ, Mar 2014
- BlaBlaCar: From email discussion with company
- The Mesh Directory, by industry leader Lisa Gansky lists out over 9,000 companies in this market.
- The Collaborative Economy Honeycomb which shows many of the startup logos
- See VC funding of this market, on a Google Sheet I manage.
- An older collection of stats and figures in this market.
- Full body of work, research, data, reports, and slides.
Contact: If you’ve recent data on your startup growth, please send to me directly at jeremiah at crowd companies.com. You can read the designer, Vlad at TransartDesigns.
- Version 1.1: The Indiegogo data was incorrect, and now reads “$285,714 a day” Thanks Chelsea Rustrom for pointing that out. (Sep 30, 2014)
- Version 1.2: Includes updated info from Lyft, that was announced just days ago. (Oct 1, 2014)
(Above: Read the full article in the SF Chronicle, and, please, read the comments. There’s no mercy for the taxi industry from former customers. Here are my recommendations to the taxi industry to lead this movement –not fight it)
The Collaborative Economy is a crowd commerce revolution.
People are empowered to get what they need from each other, using now common, mobile technologies in their pockets. Several quarters ago, people told me it was a fad; it wouldn’t last; peer-to-peer commerce can’t happen at scale. Like social media was disbelieved in 2005 (I vividly remember the attack of the blogs), we’re seeing disruptions, but these impact real revenues, not just communications.
Above Graphic: A TNC (Transportation Network Company) is the designation for Sidecar, Uber, and Lyft. From SF Municipal Transportation Agency, SF Examiner.Real revenues are being lost by incumbents.
Yesterday, at newsstands across the San Francisco Bay area and online (my pic, above), it was reported that taxis are suffering a 65% loss in rides – two thirds of their revenue lost in less than 3 years. It’s not limited to San Francisco. DC taxis are down 22% and a once dominant taxi cab company says they have less than 18 months of life left. A recent study by Boston University shows that, for every 1% growth of Airbnb, hotels are impacted half a percent – and Airbnb is growing at an incredible rate. How fast? Uber’s revenues are doubling every six months, and Lending Club, where people lend to each other instead of going to banks, is having hockey-stick like growth, having brokered $5 billion worth of loans in five years.
The startups are heavily funded in every industry.
Investors are funneling incredible amounts of money into this market: $2.7 billion in just under the last ten months (see spreadsheet), with Google being a leading investor in the market. It’s not limited to cars and homes and dollars. The Collaborative Economy is impacting many industries, including food, business services, retail, business space, and more. You can see the Honeycomb Framework to see how goods, food, services, transportation, space, and money are each impacted. The next version of the honeycomb infographic will include health, utilities, education, and more.
Progressive corporations augment their business model to partner with the crowd.
It’s important that you prepare your company for these changes now. People are empowered to get what they need from each other. The crowd is becoming like a company. The good news is that companies can use these same technologies and strategies. Ford has provided special cars to Lyft drivers, Hyatt has partnered with Uber for instant bookings using an API, Whole Foods has partnered with Instacart for crowd-based, home deliveries, and Verizon has enabled sharing of many objects using their vast network. (Disclosure: The above companies are members of my company, Crowd Companies)
Taxi chief steps down, article suggests no relation to ride sharing: “It’s not,” she added, “because Travis has kicked my ass.” —read article. For context, Travis is Uber’s CEO
If you work for or with large companies, access the Body of Work in the Collaborative Economy and discover how other companies are crowd-proofing by joining this movement.
Investors are doling out money by the fistful, $241 million deployed in less than three months.
See the Google Sheet that has all this data, broken down by industry, amount, and date. You can read part 1: Meet the investors, and part 2: The investors are in love with this market.
Since my last analysis on July 3rd, 2014, there’s been continued funding into the Collaborative Economy market –where the crowd gets what they need from each other. Investors are infatuated in this market as it provides new supply, disrupts incumbents, using faster technology powered by mobile, social, and internet of things, the Phoenix Business Journal did a recent write-up of my keynote at a business conference, highlighting the market changes.
In just 2.5 months there’s been even more money flooding the market. SMB FundingCircle raised a massive $65m round, followed by big rounds to Rockettaxi to aid the disrupted incumbents, and Fiverr raised a $30m found, as they enable crowd-based tasks to be completed on a two sided marketplace. In these past two months, there’s been $241k invested into this growing market.
Recent Funding in the Collaborative Economy
Analysis: The Last 9 Mos of Funding
Here’s a breakdown of the 2014 Funding from Jan 1st-Sept 20th:
- Total Funding Events: 39
- Deals per month: 4.3
- Average Funding Per Month $301,052,222
- Average per Funding Round $69,473,590
- Median $10,000,000
- Average funding amount without Uber (outlier) $42,084,857
- Average funding amount without Uber and Airbnb (outliers) $27,282,973
- 2014 Sum: $2,709,470,000
Bubble? I’m often asked are we in a bubble? My answer is yes and no. First of all, unlike the first web boom I experienced in late 90s or social media phase, there’s clear revenues being generated from peer to peer commerce. Unfortunately, you can’t sustain this many competitors in each arena –particularly in the transportation space. I recently told CNBC that there’s only room for three playersin each of these markets: “In the end, the market can’t sustain this many car-sharing or ridesharing start-ups—there’s typically going to be room for three—the most convenient, the cheapest experience and a unique experience,”
Photo used within creative commons licensing, by 401k
This was originally posted on VentureBeat, with a wide array of comments and reactions. Silicon Valley has been espousing sharing, making, community through the latest startups like Lyft, Airbnb, LendingClub and more. Yet is Silicon Valley really leading the example? While generalizations can put people off, I wanted to take a stand on some broader trends we see. I’ve received reinforcing and disagreeing feedback, all which I’m open to learning more from.
Photo by Adam Foster
Here’s what Silicon Valley can learn from good old Midwestern values
Silicon Valley startups like Uber, Lyft, Airbnb, Lending Club and others that empower people to get what they need from each other command extensive market attention and sky-high valuations. This Collaborative Economy prospers on the rise of local neighborhoods in home-sharing, friendly human connections with fist bumps in peer-ride sharing, and the ability to share money with each other at better rates than banks.
A year ago, I spoke with an insurance company in Iowa. They shared with me that, while these new startups are interesting, they aren’t really anything new. They reminded me that the Midwest has been participating in these friendly behaviors for a century and a half. They said “Jeremiah, this isn’t new. It’s called being a good neighbor.” What they said stuck with me for months until I decided to understand how Silicon Valley is trying to emulate Midwestern values.
Being a Silicon Valley resident, I asked my Midwestern friends to share with me what Midwestern values mean to them. I tweeted a call for responses, then graphed how people responded. While there was always some variation, a major theme developed around a strong work ethic, modest integrity and helping others. These three tenets formed a common thread: I heard from my colleague, Angus Nelson of Wisconsin, about “the value of working hard”; and from Ben Smith, a Kansas City resident, about the classic Midwest value of integrity: “Your name and reputation are your most prized possessions.” From Zena Weist of Kansas City, I learned about helping others, “A stick of butter and a smile, and no need to pay me back.”
So, how are Silicon Valley’s latest Collaborative Economy startups stacking up to these Midwestern values?
To start with, both the Midwest and the Silicon Valley share a similar work ethic. While Silicon Valley workers start the day later than Midwestern farmers, who are up and at it hours before dawn in the heartland, they do work well into the evenings and even on weekends. Tech startups offer many employee benefits to keep people on campus, enabling satisfying, round-the-clock environments. Despite different working hours, both Silicon Valley and the Midwest share the same ethic of hard work.
Yet, while folks in the Midwest take pride in their individual integrity and humility, Silicon Valley has some lessons to learn here. From ride-sharing companies fighting dirty to unethical executive behavior, from a self-righteous 1 percent viewpoint to the further divide of the rich and poor, Silicon Valley’s meritocratic culture means those that win win big — and think they have a divine right to flaunt it. I’ve seen many a roaring Ferrari or whirring Tesla in front of makeshift homeless tents in San Francisco’s tech neighborhood, the SoMA district, where I often work.
The Midwestern value of helping others without expecting reciprocation is best summarized by the “stick of butter and a smile” axiom when a neighbor is in need. Silicon Valley’s traditional come-get-mine attitude rewards the disruptors and the fiercest competitors. While San Francisco boasts that nearly one of every eight residents are millionaires, a vast majority are not living at middle class standards and are struggling just to get by. The potential for a backlash is rapidly increasing.
When it comes to the three major Midwestern values that Collaborative Economy startups are enabling: Strong work ethic, modest integrity, and helping others, Silicon Valley, as a whole, still has a lot to learn.
But with that, we should acknowledge that the new technologies that enable ride-sharing, home-sharing, and money-sharing are built on powerful platforms like social networks, mobile devices, and apps can extend the barn-raising spirit to all cultures beyond the Midwest.
These new technologies are enabling us to connect to strangers in a human way, as trust data is collected from ratings and rankings features, from social networks for verification of social circles and from mobile devices to help us navigate and find idle cars, homes, and goods.
Remember that Iowa insurance company who appropriately corrected me for glowing over the new Collaborative Economy as just being a “good neighbor”? I responded that these new technologies enable all of us “to be good neighbors to strangers.” They agreed.
We can all benefit in this Collaborative Economy, enabled by both empowering Silicon Valley technologies and Midwestern ethics, leading to further integrity and neighborliness.
Jeremiah Owyang is the founder of Crowd Companies.