Crowdfunding Economics: The Airbnb Effect
Many individuals argue that the Sharing Economy and crowdfunding emerged as an effect of many different economic factors, including the growing imbalance of wealth, the great recession, and the rise of technology (“Uber, Airbnb Lead the Way as Sharing Economy Expands,” June 30, 2017; emarketer.com/Article/Uber-Airbnb-Lead-Way-Sharing- Economy-Expands/1016109). A huge contender to emerge from the sharing economy, and one of its biggest drivers, is Airbnb. Devised online in 2007, Airbnb enables tenants to rent out their apartments and homes as hotels for days or even months at a time, which complicates and technically violates several tenant and landlord laws in cities throughout the U.S. Although Airbnb enables thousands of people to gain extra income bypassing bigger corporations and relying on their community to generate money, our traditional laws and current housing regulations do not address the issues Airbnb raises within the economy and the housing market. We are just starting to assess the effects that the sharing economy will present in the future as it becomes a more regular part of our economy and financial markets. At this point in the world of crowdfunding, there is no turning back: This new way of investing and creating capital is a part and the future of our economy.
While crowdfunding allows for the average citizen to raise funds for business ventures and special projects, it should not become the standard in raising money for the necessities of survival for an entire class of people. While scrolling through my Facebook feed on a daily basis, I cannot count the number of GoFundMe pages I see for people needing surgeries, money for college textbooks, or unexpected funerals. This is troubling. This is not why we should be raising money. However, crowdfunding is slowly becoming the accepted route to get extra cash to make ends meet. Do we, as a society, want this to become the permanent normal, or is it a quick, short-term fix to overarching economic societal problems that are in dire need of repair?
As the Sharing Economy continues to grow and becomes a natural part of our lives for both consumers and entrepreneurs, crowdfunding will only become more complicated and will need even more specific regulations and guidelines to grow and benefit us all. We collectively will have to choose whether to treat crowdfunding as a symptom of a failed economic system and start a major reform, or instead implement regulations that transform it to fit into our current model with ease. The one aspect of our economy that will not change is the number of the individuals trying to survive and make their dreams into reality despite their economic standing. These are the people who always find a way. Crowdfunding is the future, so now is the time to make amends and embrace its potential.