The On-Demand Economy

The On-Demand Economy

If you know me, I have a few well-worn expressions which capture my thoughts on finding a job. It may be cliché but you have to “follow the money” when looking for a new job. I tend to follow the venture capital (VC) firms who are funding the next generation of startups: Union Square Ventures (usv.com), First Round Capital (firstround.com), Primary Venture Partners (primary.vc) and then three here in Vermont: FreshTracks Capital (freshtrackscap.com) VCET (vcet.co) and Vermont Works (vermontworks.co).

These firms are investing in early, middle and late-stage startups.  In essence, they are placing calculated bets on the people,  the tech, the business models for future earnings.  In recent years, there have been a spate of new startups who can be broadly categorized as “on demand services”. Uber, TaskRabbit, Instacart, Upwork, Bench, Harvest . Each company has a platform and a collection of virtual assistants who will drive for you, shop for you, pick up your dry cleaning, do your book keeping. All of these companies lower the transaction costs of finding, training and ordering these services through an app, a platform and a modern UI.

Many of these companies use the term “disrupt” to describe their particular niche industry where they are using software (saas) instead of humans to provide the service.

I believe this disruption of software is changing how we work.

Who does the work. Where is the work delivered.

Gone are the days of the traditional, full time employee. According to a comprehensive study there are 53 million Americans (34% of the U.S. workforce) working as freelancers. Actually, as of October 2018, that number is now approaching 56.7 million Americans. (From “Freelancing In America: 2018)

Let me repeat that—56 million Americans.

That’s a staggeringly large number.

Fred Wilson of USV talks about “The Freelance Economy“. Chris Dixon uses the phrase “full stack startup“. Many have also spoken about the On Demand Economy (here). I speak from personal experience when I tell you that many companies continue to seek full-time positions when ultimately they really need “perma-lance” individuals,  committed mid-term freelancers who can do a job, do it well and then move on.  The companies win by getting fresh talent with the latest skills. The on-demand workers win by getting a specific, finite project. Both sides get to “try before they buy”. Additionally, the courtship or recruitment process (can be) much more abbreviated and efficient. I’m still undecided about if there is a powerful (active) marketplace for on-demand workers.

What do you think?

Drop me a line if you think it’s easy or hard in finding full-time, part-time or freelancers for your company.

I’d like to know.