The Growing Popularity of 'Collaborative Consumption

Want to Rent out That Spare Room? 


The founders of Internet startup Airbnb were accustomed to rejection. Joe Gebbia, Brian Chesky and Nathan Blecharczyk peddled to venture capitalists their idea for using the Internet to help people rent out a room, or even a couch, to frugal travelers. All of the venture capitalists took a pass. But after receiving funding as well as mentoring from incubator Y Combinator in 2009, the startup exploded. Airbnb -- the name was originally Airbed and Breakfast in a reference to the use of airbeds for guests -- has listings in 16,000 cities around the world and has booked more than two million nights.
What those early VCs missed was a burgeoning trend in what is now called "collaborative consumption." At the core of this trend is the idea that technologies like the Internet and smartphones can help consumers monetize assets that they own -- their home or car, for example -- in ways that were previously difficult or downright impossible. "There are two forces converging," says Wharton marketing professor David Bell. "First is the notion that it might be better to have access to something than to own it outright. And the second is the realization that people have slack resources. So that car you own may sit idle for 22 hours a day. The grease that makes the whole thing work is social media and technology, like iPhone applications that can create markets that didn't exist before."
A host of startups has popped up to tap into this movement, including Relayride and Getaround, which have created marketplaces to allow consumers to rent their cars by the hour. Liquidspace allows workers on the go to rent out workspace or a conference room for a day -- or even for just 15 minutes. Spotify, a European startup now expanding in the U.S., allows consumers to rent music rather than buy songs outright from services like iTunes. Gobble allows people to order meals from great home cooks in their neighborhood. And Snapgoods allows people to lend out, for a fee and on a short-term basis, gear such as photography equipment. ......read