finalleweb londonjune2013-13
TRANSCRIPT
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The Sharing Economy
Mark Suster
@msuster
LeWeb London, June 2013
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What new can a VC really tell you? 2
After 2 days of the sharing economy
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I thought I’d give some context to
Why sharing / collaborative consumption?
Why now?
What next?
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Prices
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Network
Drivers of our Future World
Economics Un / under-
employment
Debt
Globalization
Scarce Resources
Transparency
Demographic Shifts
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1. Prices
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The common theme of the
biggest Internet successes has
been “deflation”
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Biggest Internet players “disrupted” incumbents on price
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Disruptive Technologies are
2Less
Functionality /
Performance
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Lower Margins
See “Innovator’s Dilemma - Clayton Christensen
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Significantly Lower Prices
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Disruptive companies offer LESS functionality & compete
with “non consumption”
See: http://www.bothsidesofthetable.com/2011/12/22/the-amazing-power-of-deflationary-economics-for-startups/
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It’s why the TV industry still can’t get its head around
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1 billion monthly uniques 4 billion hours > 150 videos watched / year for every human
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3.4 billion video views / month
> 25,000 video creators
250 million subscribers
80% audience 13-34
40% mobile
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2. Network
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Of course we now know that 1/3rd of world is now online
13Sources: U.S. Bureau of the Census, World Bank
1995 2000 2005 2010 2012
44
411
1,019
2,019
2,291 World Internet users (M)
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And per Mary Meeker’s slides we know the audience (& opportunity) is now global
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In just 4 years 71% of the world’s literate population will have a smart phone
Source: Benedict Evans (http://www.slideshare.net/bge20/2013-05-bea)
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Incumbents simply find it too hard give up juicy margins
NetworkPrices /Margin
Startups should focus on non-consumption & they will find it hard to compete
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3. Economics
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Student debt in US along = $1 trillion. $100 million new / year. 2x rate of 10 years ago.
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19Source: the Atlantic: http://www.theatlantic.com/business/archive/2012/10/europes-most-tragic-graph-greek-youth-unemployment-hits-55/263118/
We are risking an entire generation who don’t get on the career ladder
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The sharing economy isn’t new. It’s just more urgent
Un / under-employment Debt Globalization Scarce Resources Transparency Demographics
And it’s not going away
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Trade Guilds
Wage Protectio
n / Limited Supply
Top down organization struggling to keep up with innovation or needs of
the people
Universities
High-Paid Jobs
Government
Taxation, Currency
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When governments can no longer properly look after their people, people will look for themselves
Capitalism.
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In the past forced migrations were the only answer *
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Increasingly IT-enabled people can tap into global demand networks
* We are of course seeing a world of digital have’s and have-not’s. Mobile phones bridge this gap. Who will develop services for the worlds poorest?
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Thomas Friedman
said it best
some of world’s most talented people live in economies that can’t pay them a “global market price”
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The sharing economy will have new “market-makers”
Will they all be benevolent in the future?
Market forces, transparency & new disruptions must keep them in check
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Radio. Television. Telephony. Twitter. It’s the natural extension to a global, transparent world.
Open = empowered. But also aware. And disenfranchised.
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Of course all of this open data can be mined in real time. For business. And government.
For marketplaces this can help with trust, authority, safety, marketing, & planning.Note: I’m a proud investor in DataSift
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1. THE ECONOMICS OF “GLOBAL”
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Comparatively richer countries want to tap into enormous pool of intelligent resources in countries with lower wages
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Some of the world’s most talented film maker’s can’t just relocate to Los Angeles
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Artists struggling to earn a global wage suddenly find demand at higher prices
30 million registered users
65 million month uniques
2.5 billion monthly page views
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2. EMPOWERING THE
UNDER-EMPLOYED
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With large underemployment people can earn extra $$ staying at home, while satisfying demand to avoid kennels.
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And this is true of many of the peer-to-peer marketplaces.
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3. MOVE FROM HIERARCHIC TO
FLAT STRUCTURES
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Lending Club now so widely accepted even used by hedge funds to invest
directly in consumer loans
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And of course startups can now more easily tap into pools of angel investors directly
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3. REMOVING PHYSICAL
BOUNDARIES
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By removing physical boundaries you create win-win opportunities for both instructors & students
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Example Industries: Education Music Lessons Personal Trainers Psychologists
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4. EFFICIENCY GAINS IN EXISTING
MARKETS
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Many of these markets exist, the Internet is just making them much more efficient
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So What’s Next?
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HELPING BUSINESSES TAP
INTO PEER NETWORKS
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Entrepreneurs often start with consumer ideas. Helping enterprise tap into peer networks may prove even larger
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Recap – in a world of economic challenges & large
networks … the “sharing economy” will thrive.
Will you find your place in it?
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The Sharing Economy
Thank you!
Mark Suster - @msusterLeWeb, June 2013