by Austin Robey
February 8, 2020
Many gig economy startups have created commanded high valuations built on the collective labor of their contract workforce. These platforms have promised that, if we choose, we can improve our lives by becoming a side hustling solopreneur. In our spare time, we can drive people with our cars, walk other people’s dogs, or assemble a stranger’s ikea furniture. We can be our own boss and have freedom of choice — as long as we don’t care about benefits, labor rights, harassment, or low wages. But, what is stopping workers/ users from organizing and creating their own intermediary apps once these platforms have demonstrated product-market fit?
Gig economy business models are often pointed out as some of the more obvious opportunities to be disrupted by organized tech-enabled cooperatives. Here are some domains and business models where user/ worker owned organizations could be powerful and disruptive alternatives.
Categories For Cooperative Disruption:
Some broad buckets of opportunities for creating cooperatively owned startups:
Category or geo-specific versions of larger startups
Laborers circumventing rent seeking & extractive intermediaries
Communities collectively owning rent seeking assets
Ride Sharing: ($UBER/ $LYFT): In many ways, Uber is the textbook example of a gig economy platform. The company sparked a (mostly unsuccessful) trend of Uber for “x” ideas – high growth startups hoping to create value for shareholders by intermediating on-demand labor and services. Organized local workforces of drivers that own their own ride hailing apps could keep wealth within communities and allow drivers to keep more money per ride. Also, drivers would be motivated to provide great service because of ownership, rather than a reputation ranking system.
However, it’s worth noting that some believe that we don’t need a cooperative Uber.
Co-op Examples: Green Taxi (Austin)/ Eva co-op (Montreal)
On Demand Mobility: (Zip Car/ Revel): Renting vehicles on-demand has a clear value proposition: only pay for cars when you need them. A cooperative vehicle share could resemble a housing cooperative, where the assets/ vehicles are owned by a corporate entity. Something like this has the opportunity to start small and place-based, and could conceivably grow to a national network.
Co-op Examples: Modo (Vancouver)/ Mobility Factory SCE (Europe)
ON DEMAND LABOR
Task Apps: (Task rabbit/ Instacart/ Favor): We’ve recently seen growing worker activism among Instacart’s shoppers. As gig laborers face unpredictable and low wages, perhaps the best way to reclaim a voice and dignity is by organizing workers and creating a competing application/ platform. A vetted, trusted, and motivated group of owners would undoubtedly be able to create a higher degree of trust with customers – and also may avoid the high cost and stresses of continually training the high churn of workers that platform owners may view as dispensable.
Co-op Example: Loconomics (San Francisco)
Food Delivery (Seamless/ Postmates/ Grub Hub/ Uber Eats/ Deliveroo): Food delivery apps are unique because they manage to be extractive from both the restaurants and the deliverers. A cooperative solution could either be owned by a collective of restaurants, or by the delivery riders & drivers themselves.
Co-op example: Mensakas
Dog Walking (Wag/ Rover): On demand dog walking apps like Wag & Rover have raised incredible amounts of venture capital in order to walk dogs. Both companies have raised over $300MM each! The biggest weakness of these dog walking apps are a high churn of both walkers and customers (once a trusted relationship between the walker and the customer has been formed). Trust is such a critical differentiator working with people’s pets. As a customer, knowing that a dog walker is the owner of the business, rather than an unreliable or anonymous temp, may be a huge advantage.
On-Demand Freelancers: (Fiverr/ Upwork/ 99 Designs): Freelancer-owned platforms could be successful by creating a curated platform of the best talent, which may hopefully avoid photo retouching results like this.
Software & Web Development Freelancers (Toptal): The value proposition of an organization like Toptal is that it connects people that need on-demand software development with trusted, talented, professional, and vetted software engineers. However, what would stop these software developers from organizing and building their own platform – and owning the intermediary. Surely, a group like this would be capable of building a quality product, and they could continue to work remotely capturing much more of the value of their labor.
Co-op example: Staffing Cooperative
In 2017, only 12% of music industry revenues went to artists. Musicians have always been an exploited category of artists – facing economic insecurity, extractive intermediaries, and low wages. Artists have a huge opportunity to grow and market artist-owned organizations and platforms because of the collective strength of their direct and social channels. (Imagine if 100 artists with sizable audiences are all making coordinated marketing efforts towards a common goal of promoting an artist-owned organization.)
Direct Patronage: Ampled is an artist and worker owned platform with a Patreon-like utility for direct community support for musicians.
House Shows: Sofar Sounds is a platform that curates gigs in intimate spaces like people’s homes or other secret locations, which has received scrutiny for their artist payout model.
Co-op example: Groupmuse
Streaming (Spotify): Looking at both poor artist payouts and the asymmetries in artist and shareholder interests, it’s clear that an artist and community owned streaming platform is an idea that people would be excited about. The challenge with a cooperative streaming model is going up against 4 of the most powerful tech corporations: Spotify, Apple, Google, and Amazon.
Co-op example: Resonate
CoWorking/ Membership Clubs (WeWork/ The Wing/ Soho House): What can I say about WeWork that hasn’t been said before? While WeWork and The Wing were both funded with massive amounts of venture capital investment, what would these groups look like if they were rooted in (and owned by) the communities they meant to serve? What if the idea of membership were expanded to include real co-ownership in these spaces? What would a membership club like Soho House be like if its membership was less about exclusive status broadcasting and more about building a community owned membership space?
Platforms for online courses are often cost effective, can be accessed from anywhere, and allow for a flexible learning experience. Additionally, verticalized and category-specific education websites are huge opportunities for developing cooperative platforms.
Online Courses Services like Lynda, Udemy, or Coursera offers a wide range of courses on everything from software tutorials, search engine marketing, and web development. What if there were an online education platform owned by the instructors/ experts?
Lessons: Music and instrument classes, language tutors, test preparation, and more.
Co-op example: NY Music Coop
Coding Classes & Online Bootcamps (Pluralsight, Codeacademy, Trilogy): Coders should organize and collectively own a platform to host online coding courses.
Any Online Media Publication: From Vox, to Buzzfeed, to NBC News Digital, we’ve seen a tremendous amount of labor organizing and unionization efforts with writers in digital media recently.
Co-op example: The Devil Strip (Akron, OH)