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Sharing startups struck it big and struck out in 2013

Caitlin McGarry | Jan. 2, 2014
2013 proved the sharing economy has come a long way, but has a long way to go.

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The sharing economy is a catch-all term that describes the companies who use technology to let people pool their goods or offer services instead of buying more stuff--everything from cars and apartments to books and music. The age of accumulating all the things is over, and 2013 marked a significant shift toward sharing.

The new collaborative economy has, in some cases, produced practical apps that improve the lives of urban professionals. Lyft lets average Joes and Janes with expensive car payments recoup some of their costs by giving rides around town; Airbnb does the same but for apartment-dwellers with expensive rents. The sharing model has also given way to truly terrible ideas, like sharing boats and leftover takeout. Lesson (hopefully) learned: We don't need to share everything.

From legal wins to regulatory crackdowns, sharing economy companies had a monumental year full of triumph and heartbreak. Let's recap 2013: the year "share" became a business model buzzword rather than a command from your mom.

The hits
Ride-sharing regulations: After nearly a year of legal tangling, the state of California in September finally issued rules for ride-sharing and taxi apps, or what regulators call "transportation network companies." Apps like Uber, Lyft, and SideCar have positioned themselves as technology, not transportation, companies, but California squashed that notion. TNCs are now required to apply for permits from the state's Public Utilities Commission and conduct criminal background checks on all drivers. The state is also requiring a $1 million minimum insurance policy. But the apps are, sort of surprisingly, all on board, because finally, there's some guidance on how to operate in this new world. Now they have to wait for other states to decide on their own regulations. Who knows how long that will take?

Uber gets competitive: Uber made its name as a luxury car-hailing service--simply open the app, request a car, and wait for a black SUV to drive you around in style. Uber still offers high-end rides, but the company is now playing to win with fare-splitting, not to mention price-slashing to compete with cabs in places like Chicago, and offering new ways to pay. The transportation app market is brand new but already pretty crowded, and Uber has managed to hold on to the lead despite the competition. Chalk this year up as a successful one for Uber.

Sharing a real resource: 2013 saw plenty of dumb startups plague the app stores, enticing users to share all kinds of useless crap, but a few companies are working on a sharing economy concept that would actually help benefit people: shared Wi-Fi. Companies like Fon are encouraging people to split their Wi-Fi signals and securely share a slice with the public. Cable companies are letting their customers partake in outdoor hotspots. Apps like Hotspotio turn Wi-Fi sharing into a game of sorts. Next year will be Wi-Fi sharing's time to shine.


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