Major corporations are increasingly investing in and building partnerships with emerging start-ups in the burgeoning 'sharing economy' that uses technology to connect people and services in order to keep up with disruptive companies such as Uber in transportation and Airbnb in travel.
Last month, Hyatt Hotels invested an undisclosed amount in OneFineStay, the home rental company which allows travelers to rent high-end residences while the owner is away. In March, Enterprise Rent-A-Car, the world's biggest car hire company, bought Britain's largest car-sharing company City Car Club. Automobile giant BMW last year launched the car-sharing scheme 'DriveNow' along with the car rental firm Sixt and invested in the JustPark app, installing it into its Minis to allow drivers to find a parking space.
The growth of major travel and transportation companies in the sharing economy, such as car service app Uber, valued at €35.7 billion as of last December, and space rental site Airbnb, valued at €11.6 billion in October, has fuelled an increasing interest from the mainstream corporate world. PricewaterhouseCoopers (PWC) estimates will be worth €11 billion a year by 2025.
Benita Matofska, founder of sharing economy comparison site Compare and Share and founder of the first-ever Global Sharing Week, which was held this week, says that the rise of the sharing economy is "seismic", forcing corporations to recognise the value sharing offers a younger customer base of millennials who are prioritising access over ownership.
"Business is forever changed. [The sharing economy] does not operate in the way that traditional industries do, because it's led by people, it's led by demand," she says. "Now, people are the producers and suppliers of goods and services, they are no longer reliant on large corporations."
"What that means is that large corporations are having to find different ways of doing business. Large companies are recognising that this is a future face of business and, if they want to be in the game, then they need to be in the sharing economy," she adds.
Debbie Wosskow, founder of home rental service Love Home Swap and chairman of the UK's new sharing economy trade body, Sharing Economy UK (SEUK) says it's essential for big business to think about the sharing economy. "If we look at millennials and the consumers of the future then they are going to own less assets and share more. The smart money follows them."
An independent review of the sharing economy, ordered by the government and conducted by Wosskow, revealed that the industry could turn the UK into a country of "microentrepreneurs", adding £9 billion (€12 billion) to the British economy annually by 2025.Try Newsweek: Subscription offers