The so-called sharing economy has been one of the most talked-about trends in tech circles over the past few years. The 'movement', which in the UK includes the likes of parking space finder JustPark and Airbnb rival Love Home Swap, has now got its own industry body in the UK and has also caught the eye of George Osborne, who set out plans in the spring for a pilot scheme to turn Manchester and Leeds into ‘sharing cities’.
But it’s a concept that’s extremely difficult to actually define. In its widest definition the sharing economy is taken to include most of the start-ups that are using technology and new business models to 'disrupt' their industry – from Uber’s new approach to hailing cabs to Seedrs and Crowdcube’s equity crowdfunding (which allows ‘armchair investors’ to put small amounts of cash into new ventures).
It’s a handy catch-all term for start-up marketers to latch on to, but some purists aren’t pleased that their new concept has been watered down. ‘To me, it’s really abused – everything is called sharing economy these days,’ Nicolas Brusson, co-founder and COO of the ridesharing company BlaBlaCar told MT.
The French start-up, which helps people travelling between cities to split the cost of a car journey, was recently valued at $1.6bn (£1.1bn) and has drawn comparisons with Uber, but Brusson says the two services are fundamentally different.
‘There’s nothing wrong with Uber, it’s a fantastic service, but it’s not sharing economy,’ he said. ‘If I take an Uber, where is the sharing here? I’m pressing a button, there’s a guy coming with a car, I tell the guy I’m going to the airport. He drives me to the airport, I step out of the car, I pay £20. What’s being shared?’
To Brusson the sharing economy is defined by two things. Is it something you would be doing anyway (like driving to a different town, having a spare bedroom) and are you sharing costs or just trying to make money? ‘If it’s profit-making, you’re not in the sharing economy anymore, you’re doing business,’ he said.
Like Uber, BlaBlaCar has been raising big sums from venture capital, shunning public markets for the time being. All this VC money has to run out at some point, but Brusson says BlaBlaCar has no plans to IPO any time soon.
‘We would probably want to stay private for another few years,’ he said. ‘In private markets you get the freedom to think long-term. I think the issue [with going public] is you end up with this very short-term focus where it’s like, next quarter, what are you going to do? Are you going to meet the numbers?’
‘Today BlaBlaCar is not profitable, we don’t intend to be profitable for the next three years to come and we need to find investors willing to take that bet. Public investors don’t take that bet, generally speaking.’
And what about that great iceberg that threatens to shake-up the automotive industry in the not-too-distant future: driverless cars? ‘I think it’s fantastic actually,’ he says. While carmakers are working on the technical side of things, ‘we still need to solve one thing...who’s going to be in the car?
‘What we’re creating is the trusted community, which to me is the building block of the true sharing economy, where people actually share time together, share resources together. If we had self-driving cars I think we will scale even faster.’