1. The Sharing Economy & Collaborative Consumption: Creating More Efficient Markets Through Technology Oct. 5, 2015 Prof. John Gallaugher Based on the Sharing Economy Chapter in: http://gallaugher.com/book

2. Issues Covered Overview of major players, breadth & types of services offered Drivers & benefits of Sharing Economy / Collaborative Consumption Challenges in the Sharing Economy Standout Cases Airbnb - bigger than any hotel group Uber - better than taxis for just about everyone in just about every way

3. Sharing Economy / Collaborative Consumption Share Inventory Citizen Services Rent Assets Peer Finance Sharing Economy Shifts Infrastructure (Rooms, Cars) Labor Cash Register Inspection / Verification Sharing Economy Shifts Infrastructure (Rooms, Cars) Labor Cash Register Inspection / Verification Characteristics may include: tech-powered market places, fuel more efficient matching of supply and demand, supplier/consumer pooling, lower costs, enable more efficient resource use, and provide a level of reach and services heretofore unavailable.

4. Why Become a Sharing Economy “Citizen Supplier”? Ripe Economic Conditions Many suppliers have (underutilized) inventory & skills Services w/o overhead –Marketplace handles marketing, payment, website, and more –Social media fuels awareness & endorsement –Fragmented marketplaces are ripe for “roll up” with information replacing assets like inventory, staff, and real estate Social media improves security –360° ratings, profile-linked participation

5. Challenges for the Sharing Economy Insurance issues Neighbors & tenant/owner- associations Tax challenges Governments and well-funded lobbies resisting change –medallion system, unions –will ‘contract worker’ classification hold? –operating outside regs: e.g. safety, handicapped access Further driving up housing costs, congesting roads Bias & discrimination

6. 34,000 cities in 192 countries 11 million guests in 5 yrs guest to listing ration = 11 to 1 More offerings than any single hotel group Both sides pay: guests pay 6% to 12% fee, and hosts a 3% fee Two-step verification (social media & offline documents) All communication handled & monitored through firms platform. Competitive advantage from: Two-sided network effects (buyers/sellers) Switching Costs (reviews/rep)

7. Now in: 300+ cities in 58 countries over $1B in rides in ‘13, $10B expected in ‘15 keeping about 20% $1.2B fundraising round in Spring 2014 was the biggest single amount ever raised by any privately held tech start-up, valuing firm at more than $18 billion Sept. ’15 another $1.2B at $51B for China growth is minting over 50,000 new jobs a month Driver background check, only late model cars, must be Uber-inspected Uber-upside? –environmentally friendly, more parking, fewer DUIs, city visits more appealing (trustworthy), better jobs Surge pricing to match supply & demand –balance two-sided market API to increase distribution & experience –United, TripAdvisor, Hyatt, OpenTable, Spotify