Via LinkedIn : Technology is making it cheaper and easier to share assets on a large scale, this new trend is known as the sharing economy. Statistics show that renting can replace ownership where assets are expensive and underutilised. Leading this charge is Travis Kalanick, the CEO and Co-Founder of Uber, the ridesharing service.
The sharing economy gives access to physical and human assets (time, space and skills) via a peer to peer service. Simply, companies build trust by brokering rental agreements between parties so the owner can make money from an underused asset while renters pay lower rates. Uber seamlessly connects drivers to passengers operating in 58 countries and 300 cities worldwide with an estimated value of $50bn. Cultural and technological factors may limit applying Uber’s model to the Caribbean, however regional entrepreneurs can learn from Kalanick’s leadership style and tenacity on disrupting a traditional industry.
Involve those that are economically inactive
Amazon and eBay widened the scope of goods and services easily available to customers. The sharing economy goes a step further by finding ways for otherwise inactive persons to participate in the economy. For the drivers of the one billion cars on the road that are inactive 96% of time and the cities dedicating over 15% of their space for storage, Uber is an attractive opportunity to get involved. With an app and a vehicle, a person can become an independent contract working for Uber. On the other hand, Uber partners with financial institutions so drivers can upgrade their vehicles. An expensive asset therefore earns more while drivers get flexible work and financial freedom. These support mechanisms alongside its logistics technology keeps participation growing and sustainable as quick connection to passengers remain attractive.
The sharing economy ties success to getting others involved in sustainable economic activity. Regionally, business models should get others economically active by unlocking the earning potential of underutilised assets. As persons participate competition will improve customer service by encouraging investment in better assets, group service providers and other forms of enterprise. The sharing economy gives anyone with an entrepreneurial spirit the chance to make more money from their time and assets.
Solve common problems with scalable solutions
Uber has changed the way the transportation industry worked, passengers are free to moving knowing technology will always link them to a driver. The company used a technological based solution to increase efficiency rather than replace current vehicles. Getting better cars on the road cannot solve traffic congestion and inefficiency issues with their associated negative effect on productivity. Fortunately, high mobile usage and broadband access created the environment for a logistic system that makes car rides better for drivers and passengers. The transportation industry is heavily regulated with fragmented supply create a constant pressure for improvement. With Uber, drivers get access to technology that helps them make better decisions about making more money per hour and passengers get an efficient alternative to sluggish transport.
Uber disrupted transportation by solving a universal problem with a scalable solution which feels the same in different locations. The experience is the same with minor differences based on location. Companies in the sharing economy build their brand by offering solutions that are scalable and adaptive to different environments. Caribbean start-ups should be designed to exist across the islands with consistent quality.
Improve your entrepreneurial style from past failures
Kalanick is tireless and obsessive in achieving goals with a leadership style that sees a need in marketplace and fills it. Uber is building “a network of transportation as reliable as running water, everywhere for everyone”. His entrepreneurial skills are used to know how the business generates value and where to reduce cost. Regulators and competitors are faced head on as the company has operated in regulatory grey areas and started pricing wars with competitors. Kalanick’s modus operandi takes past failures to improve his ability to select a course of action knowing the potential consequences. Uber keeps to the key moves which made it successful including raising funds privately to avoid unnecessary scrutiny and improving its efficiency as it expands. Regional entrepreneurs face a more restrictive environment where knowing your business and the entrepreneurial tenacity of people like Kalanick contributes greatly to success.
Uber popularity is connected to the reliable economic collaboration with its drivers. As the Caribbean changes how it uses technology, models like the sharing economy can widen the scope of employment and encourage low cost disruptive ventures.