By Rachel Savage Friday, 15 August 2014

The UK sharing economy could rake in £9bn by 2025

Sharing economy companies in the UK currently make around £500m a year, according to PwC. But it all depends how you define it...

Whichever way you slice it, the sharing economy is clearly big business, and a growing one at that. Room sharing platform Airbnb is worth $10bn (£6bn) and reportedly made $250m around the world in 2013, double the previous year. Car hire app Uber has been valued at a staggering $17bn, was making around $200m a year at the end of 2013 and said recently its revenues are doubling every six months.

Now a report from accountants PwC has said sharing economy companies could be making £9bn a year in the UK and $335bn globally by 2025, up from an estimated £0.5bn and $15bn today (contingent on overcoming regulatory barriers – Uber, for example, has been irking comfortable taxi drivers in cities across the world and has just been banned in Berlin).

But while everyone loves a bandwagon, especially one as lucrative as this, not all agree on what it means to be a business making money off sharing. PwC has defined it as providing a digital platform to offer people access rather than ownership of something, encompassing room sharing, car sharing, peer-to-peer lending, music and video streaming and online staffing.

The last three are a bit suspect: loaning people spare cash, finding workers on the internet and listening to music online aren’t exactly sharing things. Definitional difficulties aside, though, the trend of people making money off renting out underused assets (spare rooms, space in cars, driveways and even spare food) is clearly going nowhere but up.

‘In some ways, the sharing economy is a throwback to the pre-industrial age, when village communities had to share resources to survive,’ said PwC chief economist John Hawksworth.

‘Modern digital communications allow sharing to happen across a global village of consumers and providers, with trust established through electronic peer reviews… We think this model could spread to other sectors such as energy, telecoms and retailing.’ You hear that, entrepreneurs-in-waiting?

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