Reflections on the Sharing Economy

I learned a lot from our week in San Francisco, but my top three take-aways are:

 “Everything is up for debate.” – Mike Truong, Uber. Sharing economy companies systemically experiment and use data to drive their decision-making.  This isn’t a huge revelation, but I was impressed with the degree to which Uber, Airbnb and Feastly were all gathering data in order to improve their processes, product and customer service. Though of vastly different sizes and stages of growth, each company has impressively incorporated experimentation that is driven by data – not hierarchy – into their culture and systems. Born of this will be predictive pricing, tougher security measures, and tailored services that each company hopes will deliver a better product to both the peer provider and the peer user. Importantly, experimentation also means accepting and learning from failure, something that can be hard to handle when the stakes seem so high. Despite the risks, systematic data-driven invention and experimentation ensure that, as these companies grow, they will remain nimble enough to change strategies, spot trends, and continue to solve problems that their customers didn’t even know existed.  

 “Our currency is trust.” – Chip Conley, Airbnb. Sharing economy companies must constantly work to help the peers trust each other, and therefore, trust their platforms. For the sharing economy companies, legitimacy is everything. Feastly rigorously vets chefs and takes professional photos of their meals in order to help diners trust that the experience will be professional and the food will meet safety standards. Uber improves their app to strengthen security and feedback measures to build trust between drivers and passengers. Airbnb works with municipalities and grassroots groups to ensure that community cultures remain strong in the wake of disruptive technologies. Only with these measures can these companies create the supply-and-demand loop necessary to survive and thrive, especially since for many the sharing economy is still quite new and consumers still need a lot of education about how to participate in it.

“I’m the sum of my experiences… our generation wants and values experiences.” – Noah Karesh, Feastly. Sharing economy companies must balance the desire to provide “experiences” with the need to meet customer expectations. There is a spectrum of sharing economy companies: either they offer “experiences” for a premium or they offer convenience at a lower price – it is difficult for a company to do both at the same time.

Feastly is basing its business on the assertion that diners will pay a higher price point for a special dining experience. A higher price point seems to work for some of their more professional chefs – diners expect to pay more for better food and service. But the company can’t completely move in that direction since doing so would limit the variety of their offerings and sacrifice the characteristic unique experience that can be had with amateur chefs who command a lower price point.

Uber’s challenge is that it wants to offer good experiences (e.g. drivers singing with riders), but what its riders really want – and have come to expect (e.g. riders upset with surge pricing) – are reliable, cheap and decidedly ordinary experiences.

Airbnb may have found the sweet spot. On one hand, it knows that many guests want a reliable, lower-price alternative to hotels that is without incident so that the accommodation enables the “experience” to happen in the neighborhood/community where it is located. Airbnb also wants to offer a certain amount of accommodations that are at a higher price point for the experience of staying in that accommodation (e.g. tree house). It has attained the balance between offering enough variety of the product to meet guest expectations about experience and price. Airbnb’s challenge is that it must now also ensure that customers are appropriately matched with products that meet their expectations and valuation for an experience.

Getting Around with Getaround

Documenting damage before getting in.

The parking spot that was "too good to be true."

I used to own a car in Washington, DC, and I loved the freedom of being able to hop in and go anywhere whenever I wanted. However, I would have never let anyone other than my closest friends use my car. Since selling my car, though, I’ve been missing that freedom, so I was looking forward to this opportunity to not only drive again in the city (which I actually really like), but to also share a car that we could conveniently pick up near our apartment.  

I chose Getaround because insurance was included, lots of cars were available, and the sign up seemed easy. In fact, it was almost unnervingly easy to sign up. I did have to put in my driver’s license information, but the “check” of my record took less than 30 seconds. Did they actually check? I don’t know, but Getaround let me rent a 2007 Toyota Camry that could take four of us to Oakland for dinner on Sunday evening.

Finding the car was easy using Getaround’s iPhone app. I was able to unlock the car remotely with the app, which seemed like magic. After two minutes inspecting the car and submitting photos (see above) to Getaround via the app, we adjusted the mirrors, pulled up our directions, and took off.

The car itself was fine. It hadn’t seen a car wash in a while, but the gas tank was full and the inside was clean and free of odors. As I drove, I noticed some noises and rattling, as well as the maintenance light flash on the dashboard, which concerned me. On our way, we tried to use the freedom of the car to see other sites, but because of traffic, we ran out of time and instead headed directly to dinner.

Dinner was great and the getting there and back to our HomeAway neighborhood was uneventful despite maintenance concerns (and California drivers!).

Parking was entirely different. If there is not a designated parking spot, Getaround wants you to park the car inside of .5 miles from the owner’s address. That stipulation was only in the fine print, though, and we worried about parking outside of the .1 radius indicated on the app. We also needed to park the car in an area where the owner wouldn’t need to move it for 24 hours. In a neighborhood with street cleaning and tons of parking garages, meeting these requirements meant driving around for 45 minutes before landing in a parking spot that we thought was probably “too good to be true.” Frustrated and tired, we locked the car through the app and left it.

Overall, Getaround offers convenience and freedom for a reasonable price. On the down side, I had flashbacks about breaking down and how frustrating it is to find parking in a crowded city. Could we have rented a newer car? Yes. Could we have gotten one with a designated parking space? Probably. But those options come with a higher price tag that may not have made renting the car through Getaround more price effective than sharing an Uber. Maintenance, traffic and parking vs. freedom and convenience:  sharing or not, when it comes to using a car in the city, some trade-offs never change.

Sunday Night Comida Caribeña BonAppetour Dinner

On Sunday evening, the Dining Group got into its Getaway Toyota Camry (more on that later) and headed across the Bay Bridge to the “Comida Caribeña: Exotic & Exciting Caribbean Food!” dinner hosted by Christina via BonAppetour.  

After a short detour (either the host or BonAppetour, unclear who, indicated the wrong address on the website), we parked in front of a cheery yellow house in North Oakland. This experience was already different from our Feastly experience earlier in the day: chef Christina hosted us in her home instead of a shared kitchen and we four were her only guests. As soon as Christina greeted us at the door with a warm and eager hug, we knew this dinner would feel more like going to a friend’s house than going to a restaurant.

Christina welcomed us into her eclectic apartment, immediately inviting us to make ourselves comfortable, and pouring us delicious rum bobby cocktails. Sipping our drinks, the five of us quickly bonded, swapping travel, family and foodie stories around a beautiful round wood table. Over the rest of the evening, conversation easily flowed as if we were old friends catching up after a long time apart.

Over an entrée of (the moistest!) Caribbean jerk chicken, perfectly seasoned coconut rice with Dominican style black beans, and tender sweet glazed plantains, we learned that Christina lived for several years in Barcelona, Spain, where she started hosting supper clubs and dinners through BonAppetour. In Barcelona, she met one of the company’s founders, Rinita, who asked her to continue hosting after she moved to the Bay area this past February.

Christina, a self-trained chef, has been able to hone her hobby into a “gig economy” career. She has fostered a following as a personal chef, catering parties for locals craving home-cooked Caribbean and Argentinian cuisine. Though she now cooks regularly, we were only her second guests via BonAppetour since she first moved to the area. This is definitely not a reflection of Christina’s listing on BonAppetour’s website. Christina is available nearly every night to host guests, but the website hasn’t quite taken off in the United States like it has abroad. Also, it was unclear if Christina has had a visit or any additional support from BonAppetour since relocating. The lack of support from BonAppetour is in stark contrast to the Feastly brunch we attended Sunday morning and the EatWith dinner on Monday evening, both of which were hosted in company space and/or had a staff member present to manage customer relations.

Dinner concluded with personal pineapple upside-down cakes and an offer of coffee with continued conversation. Christina generously offered to help us find other amazing and unique dining spots in the Bay area. She clearly knew her community well and was eager to share all it has to offer.

The evening ended with warm hugs all round. As we walked to our car, we four immediately gushed about the food and the company. We all felt that this experience felt the most like going to a family dinner, with soul-warming home-cooked food and company.