For years people have been doing business the same way, but, what if I told you a revolution was brewing?
That revolution is called “The Sharing Economy” and three Iowans, Alan Kessler, Alok Epari and Melissa Kerr have all made money by joining it.
We’ll start first with Alan Kessler who, with his spouse, hosts an Airbnb on a quiet street in Des Moines.
Alan says the extra money they’ve made has helped them travel.
“We were in Maui for a couple of weeks in September, we were in New York City for a couple of Broadway shows in May, pretty much all made possible by Airbnb” said Kessler.
Alan says while traveling the couple prefers to stay with other Airbnb hosts, and believes it offers something hotels do not.
“They have all the inside scoop of what’s going on, where to eat what events are going on, makes the whole travel experience a lot more fun” said Kessler.
While Alan offers a place to relax Alok Epari offers something that will get your heart pumping.
“I have two cars, one is always sitting in the garage” said Epari.
One of those cars is a 2016 Alfa Romeo, 0-60mph in four seconds and available to rent through Turo; a sharing economy website that allows owners to rent out their cars.
“If somebody rents out your car for 30 days you’re making like three times or four times the lease or the car payments, so it’s good” said Epari.
Alok rents out his car for $99 per day. A portion of that goes back to Turo to cover the million dollar insurance policy they take out on every rental.
Experts say cars are only used 8% of the time and the sharing economy offers a way to make productive assets out of unproductive ones.
“Anybody can do it. You don’t have to start a company, people feel ownership” said Epari.
That brings us to Melissa Ker, who while waiting for a dog of her own, joined the sharing economy through a pet watching service called DogVacay.
“It was kind of a way to cure the puppy fever for a little bit and raise some extra money” said Kerr.
The website allows dog owners to find dog sitters to watch their pets while they’re away, and then sets them up with a meeting beforehand between the two.
“The meet and greet is really important because then they know if the dogs are going to get along at the house, if they like me, if they like our dog and then they just feel more comfortable with it” said Kerr.
That brings us to the cost of the sharing economy.
We’ll compare a day with our three services; Alan’s Airbnb, Alok’s Turo, and Melissa’s DogVacay with an average hotel room in downtown Des Moines, and upscale car rental, and a stay in a kennel.
Alan rents a room in his home for $69 a night, Alok rents his car for $99 a day, and Melissa will watch your dog for $25 a day. Total that up and you get $193.
For similar services though through the traditional economy you’d spend $178 for the hotel, $220 for the car, and $45 for the kennel. That’s a savings of $250 a day.
While you can save money, Drake business professor Matthew Mitchell says the sharing economy has its inherent risks.
Service is not as consistent as industry standards, and often times the initial business transaction is based solely on trust.
“Sometimes that trust can be abused and so do you’re due diligence, find out who you’re dealing with and meet in public places.”
That goes for people who are renting out their property.
“The first few times, yes, I’ll tell you that, it was like a scary experience I didn’t know who was taking it, what they were going to do, were they going to return my car or not?” said Epari.
All and all though, Professor Mitchell says those who try the sharing economy end up loving it.
“It’s up over 86% reported satisfaction” said Mitchell.
Mitchell also says it offers more than just savings.
“People report their experiences in this peer to peer economy brings them into contact with folks that they would never would have had an opportunity to have a conversation with, it enriches their lives, and that’s an exciting thing” said Mitchell.
Mitchell also suggests as the sharing economy grows Des Moines could be at the forefront. More and more people are looking at ways to insure short term rentals, and one company called "Slice" offers 24-hour insurance policies.
Mitchell says Slice has designated Des Moines as a place where the company wants to make a trial run.