the rise of the sharing economy - thinkers50.com · 108 looking ahead notes: (1) includes equipment...
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Looking Ahead 108
Notes: (1) Includes equipment rental, B&B and hostels, car rentals, book rental, DVD rental, and equipment rental (2) The sharing economy sectors being peer-to-peer lending and crowdfunding, online staffing, peer-to-peer accommodation, car sharing, and music and
video streamingSource: “The Sharing Economy: Sizing the Revenue Opportunity”, PwC, 2014
THE RISE OF THE SHARING ECONOMY
THE SHARING ECONOMY IS GROWING FAST, DISRUPTING TRADITIONAL MODELS, and will rival the rental market(1) in size by 2025
Over the past decade, the world has witnessed the rise of a new sharing economy – one where people use Internet and mobile technologies to access goods and resources provided by their peers, rather than a traditional corporate vendor. As of 2013, the five main sectors(2) of the sharing economy comprised a market of about US$ 15 Billion globally, according to PwC. By 2025, PwC says, this market will grow to US$ 335 Billion, more than 20 times its current size and equal to the traditional rental market
13
Size of Sharing Economy (based on 5 Primary Sectors(2)) vs. Traditional Rental Market over Time(In US$ Billion, 2013 and 2025)
+2.9%
335335
240
15
+29.5%
2013 2025
Traditional Rental Market Sharing Economy (Based on 5 Primary Sector Revenues)
CAGR
CAGR
Spinlister100+ countries
(2012)
Kickstarter+US$ 1.7 billion
pledges(Latest Available
Data)
DogVacay+20,000 listed
pet sitters(2011)
Uber260 cities
Served(2010)
TaskRabbit1.25 million
joiners 2013 (2008)RelayRides
+2,300 citiesserved (2010)
Streetbank+61,700 things
shared(2010)
Skillshare+1,000 classes
(2010)
xx(xx)
CompanyYear Founded
Vinted+14 million
clothes listings(2008)
Netflix57.4 millionsubscribers
(1997)
Elance2.5 million
employments(1999)
LiquidSpace+16,000 usercompanies
(2010)
Airbnb+37 million
nights stayed(2008)
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Looking Ahead 109
Spinlister100+ countries
(2012)
Kickstarter+US$ 1.7 billion
pledges(Latest Available
Data)
DogVacay+20,000 listed
pet sitters(2011)
Uber260 cities
Served(2010)
TaskRabbit1.25 million
joiners 2013 (2008)RelayRides
+2,300 citiesserved (2010)
Streetbank+61,700 things
shared(2010)
Skillshare+1,000 classes
(2010)
xx(xx)
CompanyYear Founded
Vinted+14 million
clothes listings(2008)
Netflix57.4 millionsubscribers
(1997)
Elance2.5 million
employments(1999)
LiquidSpace+16,000 usercompanies
(2010)
Airbnb+37 million
nights stayed(2008)
MANY SHARING ECONOMY SECTORS— INCLUDING CAR AND HOUSE RENTAL--WILL GROW MUCH FASTER THAN TRADITIONAL RENTAL SECTORS
Sharing economy businesses using “peer-to-peer” models are growing in influence, with top performers attracting subscribers and funding at exponential rates and taking business from traditional players. While traditional rental industries are unlikely to disappear anytime soon, their growth will be sluggish. For example, while the car rental market is projected to grow at a CAGR of 2% through 2025, the car sharing market will grow more than 11 times faster
Projected Compound Annual Growth Rate for Key Sharing Economy Sectors(In % 2013-2025)
Leading Sharing Economy Enterprises Impacting Traditional Business(2014 or Latest Available Data)
Source- Upper Chart: “The Sharing Economy: Sizing the Revenue Opportunity”, PwC, 2014Sources- Lower Chart: Company websites; Literature Review
31
-10
0
10
20
30
40
50
60
70
Peer-to-PeerAccommodation
CrowdFunding/Lending
37
Online Staffing
63
Car Sharing
5
17
Car RentalsBed &Breakfast
and Hostels
Book Rentals
-5
DVD Rentals
2
Equipment
4
Music & VideoStreaming
3
23
Sharing Economy Sectors Traditional Rental Sectors
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Looking Ahead 110
New York
17.2%
Paris
11.9%
London
10.4%
12
16
19
Airbnb
Others
Forecast
Hotel Accommodation
Bed & BreakfastAccommodation
HostelAccommodations
Peer-to-PeerAccommodation
Accommodation
2008 2009 2010 2011 2012 2013 2014 2015 2016
70
30
10
110
50
90
130
40
60
20
0
80
100
120
Number of TaxiRides per Day
(In Number of Rides, 2014)
0
1
2
3
4
5
2014
4.94
2013
3.48
2012
2.34
2010
1.16
2008
0.67
2006
0.35
AustraliaAsiaEuropeNorth America
Uber (Global)
1,000,000
New YorkTaxis
485,000
Over260
Cities
Traditional Car Rental& Taxi Service
On Demand CarRental
Peer-to-PeerCar Sharing
Peer-to-PeerTaxi Service
Car & Ride Sharing
P2P BUSINESSES ARE CHANGING THE WAY PEOPLE TRAVEL both domestically and abroad
In the sharing economy, peer-to-peer (P2P) accommodation, car sharing and taxi services have been among the fastest-growing sectors. By 2016, Airbnb is expected to surpass the number of rooms booked per night by the world’s largest hotel chain, and it already accounts for 10% of overnight stays in London. As of March 2015, Uber drivers globally were providing more than twice the number of rides per day as all the taxis in New York City. The car sharing industry grew by a factor of more than 15 between 2006 and 2014
Airbnb Nights Booked Globally(In Millions of Nights, 2008-2016)
Growth of the Global Car Sharing Market(In US$ Billion, 2006-2014)
Airbnb Nights Booked Globally(In Millions of Nights and In % of Total, 2008-2016)
Sources- Upper Chart: “Airbnb will soon be booking more rooms than the largest hotel chains”, Quartz, 2015; AirbnbSources- Lower Chart: “Strategic Insights of the Global Carsharing Market”, Frost & Sullivan, 2014; 2014 New York City Taxicab Fact Book; Uber
Examples of the Sharing Market for Accommodation and Car Rental
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Forecast(1) Total Venture CapitalFunding Globally
(In US$ Billion, 2013)
Estimate
5.10
2.701.47
0.85
0
500
10
5
2010 2011 2012 20202014
10.00 +
2013
500.00 +
Rest of the World
US
33(68.2%)
48.5
15(31.8%)
CROWDFUNDING/ CROWDSOURCING MAY PRODUCE US$ 500 BILLION IN CAPITAL BY 2020
Crowdfunding has raised an estimated US$ 20 Billion-plus for start-up enterprises since 2010. Today, there are more than 500 crowdfunding platforms worldwide. While the US and Europe dominate the crowdfunding market, accounting for 59% and 35% of funds raised in 2012 respectively, the World Bank estimates the potential market in the developing world could reach US$ 96 Billion by 2025. This is more than 6 times the amount of venture capital allocated globally in 2013, excluding the US (US$ 15.4 Billion)
Funds Raised Through Crowdfunding over Time(In US$ Billion, 2010-2014 and 2020)
Potential 2025 Crowdfunding Market in the Developing World(In US$ Billion, 2025)
Note: (1) Projection based on current growth ratesSources- Upper Chart: “The Rise of Crowdfunding”, Wall Street Journal, 2014; “Crowdfunding Seen providing $65 Billion Boost”, Entrepreneur, 2014; “Global
Venture Capital Insights & Trends 2014”, Ernst & Young, 2014Sources- Lower Chart: World Bank Databank; “Crowdfunding’s Potential for the Developing World,” World Bank, 2014
China
East Asia & Pacific
South Asia
Europe & Central Asia
6.1% Sub-Saharan Africa
Middle East & NorthAfrica
Latin America & theCaribbean
30.1%
23.4%
13.7%
6.5%
12.0%
13.8
180.5
47.6
4.9
66.9
8.0
45.0
2.5
38.7
5.6 32.4
11.0
347.8
15.1%
23.4
Net Foreign Direct Investment (FDI) Inflows(In US$ Billion, 2013)
Crowd Funding Market(In US$ Billion, 2025 Projection)
2025 Crowd FundingMarket as % of 2013 FDI
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