The basics of the business of platforms

Great interview with Sangeet Paul Chaudhary at Applico. Chaudhary writes a very instructive blog specifically on platforms - it's called Platformed. 
In this interview, he gets to lay out the basics of what platforms are, how they work, and why they are such a strong business model. 

Here's a quote:
"These are the three key shifts that have led to the rise of platforms and the three specific ways that platforms differ from traditional business models:

They are networks, not linear

They allow participation, not just consumption

They rely on data to enable value creation"

Can sharing expand the economy?

Interesting observation in an interview with Arjun Sundararajan: 

"...when a technological change comes along that makes “production” more efficient, it eventually grows the economy because it creates new opportunities.

The mortgage example is exactly that. It’s more likely that I’ll be able to afford a larger space if I can explicitly factor in the revenue stream that I’ll get from renting it out during the ten days that I’m traveling.  And that is expansive for the economy, not recessionary, because I’m probably going to get more space. People are going to use that space when I’m not there, and that generates commercial activity as well".

Flying under the regulatory radar

Another article – this one in the Boston Globe - examining the uncertain status of people making their living in the sharing economy.

As a driver for Uber or a “tasker” working for TaskRabbit, are you an employee or an independent contractor? The difference is sick leave, health insurance, contribution to your pension..

Here’s a quote:

“If all these start-ups had to hire employees in every city they operate in, their costs would jump — perhaps to the point where they’re not economically viable. And yet if the innovation economy produces companies that have hundreds of thousands of “non-employees” who love the lifestyle, but don’t have unemployment insurance or retirement plans, we’re going to have problems as a state and society”.

Show what you want to share

A super-simple solution for showing your neighbors what you are willing to share: Put a sticker on your mail box that shows it.
The stickers are available from Swiss pumpipumpe.

Who will be the Amazon of sharing?

Apparently Airbnbis now valuated at $ 10 billion, and Uber at an unbelievable $18 billion.

Why? My guess is that it’s not because investors believe that there’s such an enormous market in private rooms and fancy rides.

Rather, It’s about creating a platform that could become a corner stone in the future economic global landscape. Each of the two has a chance of becoming the Amazon of sharing.

It’s easy to imagine the next steps extending the business model to new areas. Airbnb could start bundling rooms with other services: Cleaning, local transportation, local guides, boats and sports equipment, local meals, and transportation from home and back… They could basically try to cover all aspects of travel by using idle resources and sharing. Indeed, they are already making such extensions.

Likewise, Uber could extend in other directions: luxury services or various other modes of transportation – including air travel.

Whatever the details, this general direction seems obvious. Once you have created a platform for brokering resources, when you have the user interface in place, the apps, the payment structure, the trust mechanisms and a strong brand with lots of traffic, it’s cheap to include other areas of use.

Generally, such platforms have low marginal costs and strong network effects. Everybody wants to be on the platform where everybody else is.

So it’s a game for giants.

One thing I don’t understand, though: Why is EBay just letting this happen?

The grey side of the sharing economy

Excellent article in the New York Times, describing what it's like to work for Uber, Lyft, Taskrabbit.. - trying to collect a decent income from lots of little tasks. 

The article is well balanced, it seems, showing both how the sharing economy bypasses a lot of the workers' rights and protection that have been built up over decades - but also acknowledging that this is an opening available for those who might otherwise not have employment. 

A couple of quotes: 

"In the promising parlance of the sharing economy, whose sites and apps connect people seeking services with sellers of those services, Ms. Guidry is a microentrepreneur. That is, an independent contractor who earns money by providing her skills, time or property to consumers in search of a lift, a room to sleep in, a dry-cleaning pickup, a chef, an organizer of closets."

"In a climate of continuing high unemployment, however, people like Ms. Guidry are less microentrepreneurs than microearners. They often work seven-day weeks, trying to assemble a living wage from a series of one-off gigs. They have little recourse when the services for which they are on call change their business models or pay rates. To reduce the risks, many workers toggle among multiple services".

What’s going on in digital China?

Another newsletter out from the Universe Foundation's Suitable for Growth project, which looks at how Danish companies can expand their market in China beyond premium customers in the coastal cities.

This issue examines online China. China has the most Internet users of any country, and they are among the active users of e-commerce and social media. Clearly, no foreign company can ignore the digital dimension of the Chinese market – but they need to be aware of how Internet use is different there.

You can read an Interview with the Danish founder and owner of Shanghai-based, web agency Shanghai jungle, Alexander Schultz.

Frank Zhan, director at Grundfos China, talks about Grundfos’ use of Weibo Miniblogs. 

And there’s an overview of the Big Four Chinese web services.

Knud Foldschack og kravet om normalitet

Jeg kan varmt anbefale at læse Politikens interview med Knud Foldschack, hvor han fortæller, hvordan en meget hård barndom har givet ham en forståelse for alle dem, der ikke lige har styrken til at fungere i et super effektivt konkurrencesamfund. Det er en rystende historie, men den er fortalt konstruktivt og uden fordømmelse. 
Her er et citat: 
"Alt er bygget op på, at vi skal tilbage til det traditionelle arbejdsmarked. Men hvorfor skal alle nødvendigvis det? Hvorfor er det en fuldkommen indiskutabel sandhed, at vi alle sammen straks skal i arbejde? Hvorfor er det ikke et mål at sige, at vi skal have et godt liv? Tænk på indvandrerkvinder, der kommer fra en verden, hvor de har set deres mødre blive skudt eller deres mænd blive tortureret ihjel. Hvorfor er det ikke et mål, at de skal yde f.eks. ved at passe på deres børn og så over tid komme ind på arbejdsmarkedet? Hvorfor skal de tvinges i arbejde i henhold til paranoide rådighedsregler? Vores samfunds ufravigelige logik er, at man kun er en del af fællesskabet, hvis man er med til erhvervseffektivt at producere. Og det er jeg simpelthen ikke enig i. Jeg mener, at alle mennesker på denne jord vil præstere og have et godt liv. Og i og med at ingen ønsker sig et dårligt liv, er det jo mærkeligt at påstå, at der findes mennesker, som ikke gider."