If you’re reading this, you already know how important energy is to us. It powers our transportation, logistics, industry, agriculture, homes, and the very digital device you’re using now.
What’s the Collaborative Economy? An economic model where technologies enable people to get what they need from each other –rather than from centralized institutions. This has impacted cars, hotels, banks, retailers, manufactures, and more.
How is the Energy Sector being impacted by the Collaborative Economy? You might be amazed to learn that P2P lending, Makers, and sharing are causing some changes. This week, I keynoted the North West Energy Conference, Efficiency Exchange, present were 500 energy professionals from utility companies, manufactures, and consultants were in attendance. I shared with them a few examples of how we’re seeing bottom-up, democratized startups enabling people to collaborate among themselves for energy creation, storage, and sharing.
Here are some of the examples I cited:
Crowdfunded Solar Enables the Maker Movement of Energy
What’s a maker in the energy sector? Anyone who’s creating their own energy, and, perhaps, sharing it with others. Solar Mosaicenables thousands of people to have access to affordable solar loans, gives investors opportunities to fund renewable power, and allows clean energy supporters the power to spread the wealth of energy from the sun throughout their communities. Respected industry leader, Lisa Gansky, is on the board.
Yeloha Connects a Marketplace of Solar Energy “Makers”
Yeloha is a new company that launched last week. They’re a network that allows for the sharing of solar energy between “sun hosts” and “sun partners.” For the 80% of Americans who would like to install solar panels on their roofs can’t afford to, Yeloha provides them with access to purchase solar energy generated by their neighbors.
Tesla to Provide Home Energy Storage, Enabling Local Resiliency
Tesla is now offering a home battery storage system for residences. The target market for these batteries are homeowners interested in backup storage from their solar panels in case of an outage, or for those living off the grid. This makes local neighborhoods more resilient and, combined with solar, potentially more independent.
Dutch startup enable P2P sharing of power credits
Vandebron arranges for consumers to buy electricity from independent producers. Based in the Netherlands, Vandebron, currently has 12 producers providing enough energy for 20,000 households. Customers receive their sustainable energy through the national grid, but from sources (typically farmers) and methodologies (wind, solar) selected by each individual customer. The company’s revenue stream is from subscriptions, which keeps them at arm’s length from promoting consumption.
Cities and contractors are sharing large equipment, increasing efficiency
MuniRent enables public agencies to easily share heavy duty equipment internally and with other agencies. Yard Club benefits both contractors who own equipment and those looking to rent. The owners get to make some money on their equipment, while the renters save money compared to what they would pay traditional equipment rental companies. This, of course, begs the question: How else might cities and the companies who work with them become more energy and resource efficient?
Other Collaborative Economy startups enable efficiency in transportation and goods
Ride sharing apps like Sidecar, Lyft Line, Europe’s BlaBlaCar and Uber Pool aim to maximize the number of passengers in a car, increasing efficiency of time, energy used, and traffic. Auto and Boat sharing apps like Getaround, RelayRides, Zipcar, BMW DriveNow, and Boatbound increase utilization of vehicles by allowing them to be shared. It goes without mention that Yerdle, Craigslist, Tool Sharing spots enable local communities to increase utilization of un-used goods, reducing global shipping and manufacturing.
We’re in the Early Days of the Collaborative Economy, As it Begins to Permeate Society.
These examples are on the horizon. There are just a few. Some of them have just birthed or have not yet been widely available, but there’s enough evidence to see how sharing and crowdfunding people are enabling to “make” and share energy independently, which could literally create shifts in the balance of economic power. In December 2014, we launched the Collaborative Economy Honeycomb 2.0, featuring a Utilities hexagon which is broken down by Telecom and Energy. Some of the previously mentioned startups were not yet operating. We’ll include them in the next iteration of the graphic. This market is changing rapidly.
Above: This Collaborative Economy Honeycomb maps out how
P2P Commerce is impacting all areas of society,
including Energy (Purple hex, bottom left)
Leaders in the Energy Sector Will Shift Ecosystem Roles, Providing More Value
In my presentation, I provided the business leaders of the Energy Sectors examples of how other large companies in other industries are adapting (see timeline, or detailed database), by creating and enabling P2P marketplaces around their companies or by providing a platform for others to co-create with them. In the case of the energy sector, large utilities could first enable solar on homes, take a revenue cut of the excess energy created, and provide marketplaces that enable the distribution of that excess energy within in a region. The role could shift to facilitator or enabler as the crowd continues to buy in.
To learn more about my vision about how large companies can participate, here’s my full body of work.
Update: Here’s a video interview of me, at the conference, discussing the energy opportunities in the Collaborative Economy.
Updated: Nov 23, 2014, with newer posts added.
The Collaborative Economy is a powerful movement that shifts power away from corporations. Over the last several months, I’ve focused my research efforts on the Collaborative Economy a new economic model where there’s shared ownership and access among people, startups, corporations, and governments. They’re using social networks as a conduit to get what they want from each other –rather than inefficient institutions like failed subway systems, taxis or un-interesting hotels. They’re also Making their own goods and products and selling or giving it to each other, unlocking core skills that all humans in villages used to have, but not using technology to learn, share, and distribute beyond physical borders. The impact this can have to opportunity markets all across the globe can offer them new ways to generate income, share what’s valuable, and reduce their dependency on others.
This body of work is focused on answering the following: What role do corporations play, when people get what they need from each other?
To best understand it, I’m living in the collaborative economy. I’ve also conducted field research, using the services myself such as staying in strangers homes, and even let a stranger drive my car for a weekend. For business purposes, I use oDesk, Taskrabbit, CrowdSpring, Zirtual and other crowd based services to get what I need on demand for cheaper. I’ve also made a conscious effort to reduce my consumption of physical goods, I seek to use what I already have, then if I need it, I’ll try to get it used. I keep a purchase log (not including food, personal/health care, business travel) of what I’ve purchased and it’s less than 10 items since June 10th. Yesterday, I visited ScootNetworks and rode their on-demand scooters in SF, and last week PopExpert a service that connects experts to students regardless of location, had drinks with the founder or RelayRide, visited the new AirBnb HQ and two weeks ago took a class on 3D printing at the TechShop a place for Makers.
Body of Work: Index of Collaborative Economy resources for Corporations
To best find this information from one single post, I’ve sorted it into a logical order, rather than rely on search, or the reverse-chrono order that blogs list as a default.
- What it means when the crowd becomes part of your company: Simple, clear and concise breakdown of what it means to your company.
- Three major causes of the Collaborative Economy: Find out how over a dozen attributes are cataylzing this movement, organized into distinct categories.
- Past, present and future. See how they all fit in, the internet era, social media era, and the upcoming collaborative economy era.
- The darkside to the Collaborative Economy. A big long list of challenges, oppositions and a realistic look at what could stop this movement.
- A large collection of stats of this industry. Behavior, attitudes, adoption, market and financial impact, growth rates.
- Alliances are forming in this market: See how startups, and corporations are building alliances.
- Sharing is not new. We’ve been doing it forever –but now, we have new technologies.
- Essay: Here’s what Silicon Valley can learn from Midwestern values
Glossary and Terms
Investor and VC Analysis
- Meet the Resilient corporations. In responses to the Empowered people (the link, directly above)
- Business opportunity “Blue Ocean” new business software needed: In this post, we identified the need for new enterprise class software to emerge to help corporations.
- How Social Business and the Collaborative Economy are related: The first phase of social is sharing of ideas and media, the second phase is sharing of goods and services. They both use same tools.
- The crowd can make companies resilient. Use the crowd to be like bamboo, flexible and fast growing.
- Corporations will emulate the startups: See how it will play out across the ecosystem.
- Six opportunities for Hotels. Perhaps the first to be disrupted, here’s pragmatic advice on what to do.
- Shapeways delivers the promise of 3D printing as a service: See how 3D printing enables local creation, on-demand, customized goods.
- How this movement weeds out the jerks: This movement deploys reputation management, social graph, and insurance.
- Uber and AMEX partnered, expect a new type of customer score to emerge.
- The Collaborative Economy APIs Mean Changes to Commerce, read analysis.
- Here Comes the Collaborative Economy Customer Score
- The Collaborative Economy is for Business to Business
Business Strategies and Models
Studies: Interviews with over 35 experts, input from over 34 individuals, analysis of 200 startups, and VC data.
Speeches and Storyboards
Above Image: Honeycomb 2.0, click and access multiple sizes stored on Flickr, Please share widely, with attribution, non-commercially.
The first version had six industries –now it’s twelve
Above: Version 1.0 of the Collaborative Economy Honeycomb
Infographic: A Day in the Life of the Collaborative Economy (Ver 1.1)
The Future of Business Models #FutureOf from Jeremiah Owyang
The above storyboard clearly encapsulates the business disruptions and opportunities in a clear way for business folks to understand and move into action.
Above: “Massive” Funding Table of Startups
Above: How do these new business models impact retailers?
The above report, partnered with Vision Critical surveys 90,000+ people on how they share in this new economy.
Video: Power of sharingIn each of the above, there are even more links to additional studies, books, reports, videos, and other resources to guide you in this journey. Feel free to add links below to other bodies of work as we all collaborate together. I’ll be adding to this on a periodic basis to keep it update. Photo used with Creative Commons licensing by Matthew Aubry
Above Image: An advanced view of the Collaborative Economy Value Chain in an ‘exploded’ view. This exclusive image, which was not included in the seminal report on the Collaborative Economy, shows a potential new business model that taps into new transactions beyond traditional selling. In the final phase of “Provide a Platform,” the crowd is building new products.
[The Collaborative Economy is an economic model where ownership and access are shared between corporations, startups, and people]
First, it’s key to read the full report and watch the 18 minute video of the highlights of the research report, the Collaborative Economy. The report defines the movement, gives quantified examples of disruption, indicates the three market forces that are driving this trend, and offers solutions for corporations who must adopt the value chain. Once you’ve done this, we can explore the advanced model (above), which proposes a hypothetical model that we created in the market where new forms of transaction emerge and the end state is where the crowd starts to design and build the company’s products.
[For corporations that adopt the Collaborative Economy Value Chain, this results in market efficiencies that bear new products, services, and business growth]
Exploring the Above Graphic: The Collaborative Economy Value Chain (Exploded View).
Starting at the top at the products and moving clockwise, let’s explore the three major use cases of the Collaborative Economy for corporations. In each phase, a shift is required as products become services, services become marketplaces, and marketplaces build products. I have named each of these phases, and then I have given real world examples of these phases already happening. In the table below, I give further definition to the transaction types at each phase.
- In Company as a Service products become services. In this advanced model, companies move beyond traditional selling and transform their products to services. I call this, “Company as a Service.” To date, both BMW and Toyota are renting their cars from their dealership lots in San Francisco in order to serve the growing car-sharing trend. For those familiar with Netflix or Salesforce, this business model isn’t new, and it’s a good entry point for corporations.
- In Motivate a Marketplace services become a marketplace. Companies evolve their services to an entire marketplace, called “Motivate a Marketplace,” which taps into peer-to-peer markets that are already trading goods and services a traditional company involved. The difference here is that corporations must join this marketplace, rather than stand aside and be disrupted. One notable example today is Patagonia, which partnered with eBay to encourage customers to buy used goods, rather than buy new.
- In Provide a Platform, marketplaces build your products. The last phase, where marketplaces shift to products, means that corporations allow the crowd to collaborate on core business functions, such as design, funding, marketing, development, production, delivery, and sales. We’re already seeing examples emerge in pieces (Kickstarter for funding, Etsy for production, Quirkly for development, and Deliv for delivery). I see copious, open, market opportunities for brands to transform their businesses by being involved in the Collaborative Economy.
Transactions in the Collaborative Economy
Now that we’ve identified the phases in the Collaborative Economy Value Chain, we are free to explore the many transaction types that have already emerged in the industry. I’m thankful in particular to Neal Gorenflo, the founder of Shareable Magazine (the premiere media site in this space), who spent a few afternoons with me to map out the transaction types during my research process. The table below was featured in the appendix of the report.
||Not new — but more and more individuals are empowered to provide goods and services directly to consumers online.
||Crafters sell their wares on Etsy; virtual workers get hired on oDesk and Elance.
||Traditional selling as we know it has morphed as disintermediation has occurred.
||For payment, a seller offers used goods for purchase.
||Craigslist and eBay are household names, but Apple’s refurbished products also count.
||Most non-consumable goods
||For payment, a provider offers a product for use.
||RelayRides enables consumers to rent cars from anyone. Rent-a-Toy allows parents to rent toys for their children.
||High-cost or low-usage goods
||For a recurring payment, a provider offers repeat products or services.
||Zipcar offers a month-to-month subscription plan with tiered pricing.
||Renewable goods, goods that require seasonal storage, repeat services
||Two or more own or share a product or service together. Applies to individual and business.
||Sharing babysitting services on Sitting Around.
||High-cost or low-usage items
||Consumers become investors or banks, or invest in or lend directly to each other.
||Kickstarter enables the crowd to fund and help products to market. Lending Club, Zopa, FundingCircle, and Prosper facilitate peer-to-peer lending.
||Financing at reduced rates
||For no payment or a nominal fee, two parties trade goods or services directly.
||99dresses allows women to trade fashion. HomeExchange facilitates home swaps.
||All goods and many services fit into this category.
||For no payment or a nominal fee, a provider offers a product that will be returned.
||NeighborGoods facilitates loaning of household items, and more.
||Most non-consumable goods
||For no payment or a nominal fee, a “gifter” provides a product or service to a receiver. Reciprocation may be a requirement.
||Freecycle facilitates gifting of goods. GiftFlow’s mantra says it all: “Give what you can. Ask for what you need. Pay it forward.”
||Most non-consumable goods
Counterintuitive: Let go of your company to gain the market.
This macro view of how a corporation’s business model must change beyond the traditional selling model may be foreign to sellers of durable goods, CPG, retailers and wholesalers. When you look closely, however, large tech companies like IBM, Cisco, Microsoft, Salesforce and others are already activating many of these use cases. We expect that some companies will eventually incorporate at least one of these major use cases, but the really savvy ones will activate all use case scenarios to tap into their marketplace and glean a share of the new market transactions that are already happening without them. We looked closely and found that, on average, the sharing startups like Kickstarter or Uber are taking about a 20% transaction fee. We believe corporations can do the same. Without a doubt, the biggest challenge is the of the major paradigm shift that is necessary for corporations to let go of old methodology. The only way for business leaders to advance to this phase is to “let go” of your company to gain the market.More: Read all my posts tagged the Collaborative Economy for additional information.