Social Skepticism and Its Effect on Shared Economy

Introduction

Business models have changed, and it remains a surprise to many how the things we never imagined could turn to business are not only contributing to economic development but also disrupting the service space globally. Even though we sleep in hotels, we never knew a time would come in history when we will have to share a house with a stranger through Airbnb. We book cabs online through platforms such as Bolts and Uber, and a stranger shows up to drive us. The new disruptive models of businesses are now making strangers meet strangers for economic and service benefits. This new shared economy system begs for a very pertinent question. Has human trust increased to that point where we can completely trust strangers? This chapter answered the above question within the African context while considering some case studies of failed start-ups that launched on shared economy models.

The shared economy has been described and defined by many professionals with various terminologies. It has been variously referred to as crowd-based capitalism, the collaborative economy, or the gig economy. Whichever terminology as mentioned earlier is used in describing the shared economy, the common idea in all the descriptions is that the sharing economy is decentralised, involves peer to peer economic activities and has broken down the traditional trust issues for economic progress.

The human race has been structured naturally to deal with strangers. On average, a human being will meet an average of ten strangers per day and probably do business with 3 out of 10. However, in the past, humans would always want to have a physical meeting with individuals to erase their doubts about an individual they want to transact business or access a service. Currently, this has changed, and services from strangers are no longer based on physical assessments and confirmation. Platforms such as Fiverr where skilled professionals register to offer freelance services to people, they might never meet in their lifetime is a sign that the world changed. It seemed that at some point, scepticism, trust issues and cultural reservations were overcome to some extent globally which paved the way for platforms entrepreneurship and sharing economy globally.

This chapter also made some comparative analysis of a homegrown platform that did not survive the valley of death in the Nigerian Innovation Ecosystem and successful similar foreign models imported into Africa. A definite opinion analysis through scepticism lens was used in writing on GoMyWay.com. This Nigerian car-pooling start-up failed after two years of operation and Bolt, an Estonian car-pooling platform that became very successful in 15 countries. The chapter concludes by making a strong case for models that dwarfs scepticism in order to ensure the survival of the valley of death for platform entrepreneurship in Africa.