Robert J. Mullins CFB Sr. Staff Writer with Jeremiah Owyang, on collaborative economy. The collaborative economy has put some established companies into an “If you can’t beat ‘em, join ‘em” position in which they also have to offer their goods and services via a collaborative model.Marriott Hotels recently partnered with a company called LiquidSpace to set up a service called Workspace on Demand. While not offering sleeping rooms, the service does let people book conference rooms at Marriotts in major cities such as New York, Washington, D.C., Chicago and San Francisco.
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Jeremiah Owyang, an analyst who follows the collaborative economy, says the Marriott program is in line with other collaborative economy models in which idle products, services or other resources can be more efficiently put to use.
“LiquidSpace enables corporations to share their unused office space on demand and now Marriott lists their extra office space at each hotel on that site,” said Owyang, in an interview. “So, if you need a touchdown desk in a city, you could go to Marriott On Demand, click a button, you walk in and it’s yours.”
Owyang is the author of a report titled “The Collaborative Economy” and published in June by Altimeter Group, which pegs the current value of the collaborative economy at $26 billion. The report advises established companies that they “must adopt the Collaborative Economy Value Chain.”
“People can share things with each other rather than buy them from corporations. It’s created an incredible upheaval in the business market,” Owyang said of the collaborative economy. “The crowd has become like a company and they get what they need from each other rather than from inefficient institutions.”
And a key component of the collaborative economy is crowdfunding. Although not all collaborative economy startups are crowdfunded, many are.
The crowdfunding site Indiegogo lists collaborative efforts for art, gaming, community projects, journalism and music recording as examples.
In another example of an established company hooking up with a collaborative economy company, General Electric partnered with ride service provider Uber to offer a fleet of DeLorean cars for a promotion in San Francisco in early September. The DeLorean, made famous by the “Back to the Future” movie franchise, is featured in a new GE ad campaign.
Uber is a top collaborative economy success story. Having raised $50 million in venture capital funding, Uber connects people needing a ride with an available vehicle from a car service – usually those black Lincoln Town Cars you see driving around. Between scheduled trips, the cars are often idle and can be hailed to give someone else a ride before making their next scheduled pickup.
But the Uber model doesn’t just apply to Town Cars, says Owyang.
In August, Uber reported that it had received a $258 million investment from Google Ventures and an investment firm called TPG Growth.
“Proceeds [are] to be used to expand into new markets, begin marketing efforts, and fight off protectionist, anti-competitive efforts,” Uber CEO Travis Kalanick stated in a blog post.
In some markets, major rental car agencies and taxi services have accused Uber of unfair competition. But “expanding into new markets” indicates how the Uber model can be applied to other services, said Owyang.
“Uber is about delivering what you need on demand at a local level,” he said. “Eventually Uber will deliver food, your groceries, eventually things from local retailers and other merchants. So why would Google invest in that? Because Uber is the next Amazon, but it’s tapping into the local resources rather than some giant fulfillment center in Seattle.”
Moxie Software is adapting to the collaborative economy. The Sunnyvale, Calif.-based enterprise social media software company delivers social media platforms that a company can use to connect with its customers, partners and employees, much like Facebook connects people in the world at large.
Moxie released a report documenting the growth of the collaborative economy, based on research from Altimeter Group and Forrester Research. For instance, collaborative economy startups like AirBNB and Uber have received a total $2 billion in investment funding and that 74 percent of them have social media features as a part of their offering. Also, 64 percent of collaborative economy startups are peer driven, meaning individuals transact with other individuals.
One example is NeighborGoods, a site at which people can borrow tools and other equipment from their neighbors if they need them just for a short time, avoiding the cost of buying it themselves. At a conference this reporter covered in 2011, NeighborGoods founder Micki Krimmel gave the example of someone who would borrow a drill from a neighbor to hang some pictures on their walls. Her mantra: “Which would you rather have, the drill or the hole in the wall?”
Moxie thinks the collaborative economy can work within companies, too.
“I think all of us are impacted by the way things have changed,” said Tara Spoorer, marketing director for Moxie. “[Like] the way I can cue up a taxi on my phone. It’s amazing to me that it works so easily. And it makes you think, ‘Why shouldn’t everything else I’m doing at work be just as easy?’”
Because its target market is the enterprise, Moxie builds collaboration into its social media platforms, enabling workers to share information in order to get work done. The old adage was “information is power,” the argument being that if you have information that others in the organization don’t have, you have an advantage over them. But that notion is turned on its head in the collaborative economy, Spoorer said.
“I think information is still power but it’s the shared information that is powerful, not the hoarding of information,” she said.