Product, Service & Design Innovation
Run Up to SB '13:
Neal Gorenflo on the Cultural Shift Around Innovation and the Sharing Economy

Neal Gorenflo is the co-founder of the non-profit Shareable, whose mission is to empower everyone to share for a more joyous, resilient and equitable world. Shareable is best known for its online magazine covering the sharing economy.

At Sustainable Brands ’13 (June 3-6), Gorenflo will be moderating and participating in panel discussions focused on entrepreneurial trends and the importance of connecting innovation with purpose. I asked him a few questions about how sharing fits into the picture.

What is the power of the sharing economy?

The power of sharing is you can radically reduce resource consumption while radically improving access to resources. There’s nothing else that can do that. But it’s not just about having access to a car on grocery day. It’s also about access to the talent you need for your project, or going on Kickstarter or another community platform to get funding. It’s about dramatically improving access to all the types of capital needed for innovation — financial, human and social.

It’s also a way out of the isolation I think many Americans feel — the loneliness, the helplessness. You can’t do anything alone. If you don’t have any friends or colleagues interested in you or your project, then you’re done. In the sharing economy you can connect with helpful, like-minded people faster than ever.

The benefits to the environment and society are clear, but does sharing really help the economy?

Consider this: The National Building Museum estimated that for every 15,000 cars a city can take off the ownership roles, it can keep an extra $127 million in the local economy annually, because 80 percent of transportation costs leave the local economy via gas companies, car companies, financing companies, etc.

When we helped to launch the Sharing Economy Working Group in San Francisco last year, we recognized that if the city reduces the number of cars by half, it could keep $2.5 billion in the local economy. That’s freeing up roughly $10,000 per person. And where are they going to spend it? In the city. So there may be nothing better for a local economy than shifting from car-heavy to car-light, via sharing.

You prefer the term “sharing economy” over “collaborative consumption” or “resource efficiency.” Why is that?

I think “sharing economy” communicates a social purpose and the wisdom of democratizing wealth. Wealth is a shared condition. It’s something we create, enjoy and protect together. I don’t think it’s a coincidence that the economy is unstable — often to the brink of collapse, like the 2008 subprime crisis — and we also have record wealth- and income-inequality. These things go together. The fact that wealth is so concentrated threatens our entire economic system. A thriving working- and middle-class is essential to a strong economy. Citizens need disposable income to spend into the economy, but people face stagnating wages, high unemployment, record household debt along with rapidly rising healthcare, education, food and housing costs.

The title of your book, Share or Die, suggests we’re in a pretty dire situation. Is it that bad?

It may seem a little bit stark or over the top, but that’s where we are — seven billion people and growing, and growing per capita consumption. Unless we learn to share, we’re in real trouble. The book is targeted to young adults on the verge of graduating into a very difficult job market. We want to show them there is something else out other than working in the boiler room of the Titanic old economy as it sinks. We want to help find something that’s more promising, with connection and purpose that resonate with their values and hopes.

So what is out there for them?

There’s a mega-shift underway in work and consumption that isn’t often talked about. We’re shifting from a top-down factory model of the economy to a peer-to-peer network one. In this transition, everything is redefined, from work to identity to business models to law and regulation. It goes beyond the usual access-vs-ownership mantra we hear in the media about the sharing economy.

Young adults are redefining the American Dream from one based on competition and shopping to one based on collaboration and sharing. They are buying houses and cars less than their parents. They are renting instead of owning, and escaping the high cost and burdens of ownership. They are leaving the suburbs for the city. And they’re seeking work with purpose.

Share or Die is an attempt to accelerate this shift, a call to action to get more young adults headed in this direction. And it’s possible that this shift could go easier and faster than people expect because of the Internet. It’s the ultimate tool for this transition. It allows people to explore and pursue options much more quickly. If you’re new in town, you can get involved and add value somewhere in the innovation ecosystem the day you arrive. You can go to a hackathon or a co-working space, or go on meet-up and find “your people” right away. It’s super empowering if used well.

It’s the great accelerator.

That’s right. I don’t think the sharing economy is new. I think it is amplified with technology and coming into public consciousness for a lot of reasons. It’s opening the doors for massive innovation, because the new technologies and business models make it much easier for an ordinary person to just plug in to the process.

For instance, you can join Tech Shop and have access to millions of dollars' worth of shop equipment. Within weeks a person can build a prototype, fund it on Kickstarter, locate a manufacturer, sign up with a drop-shipper and stake out e-commerce on Shopify. Just a few years ago, only big corporations had access to those kinds of resources. In that sense the sharing economy is moving opportunity from Wall Street to Main Street and leveling the playing field a bit.

So what’s the lesson for established brands?

Entrepreneurs and brands must find ways to make interactions more social and less transactional. The sharing economy is about re-embedding relationships back into the economy. People want great life experiences, and that mostly comes from authentic, high-quality social experiences.

Airbnb has been very successful at this in the travel category. In my experience with the service, even though money was involved, it wasn’t transactional. My Airbnb hosts have made me feel more at home in the world and feel better about what is possible in it. They inspired and empowered me. That’s what you should strive for to build your business or create a service, whether you’re a startup or a big brand. Building communities that empower people is a huge competitive advantage over the legacy economy, because you’re no longer forced to just compete around price and features.

Is community the main element in creating a less transactional experience?

A helpful community is at the center of it — one that makes you feel safe and cared for. I think community is the ultimate social security. Money in the bank isn’t quite what it used to be in this casino economy. Big banks and financial markets are unpredictable and compromised.

I’m just in love with the idea that we have our friends and our family and our community to help us, but we can also have a world — an economy — that’s filled with helpful strangers. That’s what I want.