The On Demand Economy has swiftly taken over the traditional business models by serving people with what they want and where they want. Statistics show that this new trend called on-demand or access economy has changed the way businesses serve people and has thus become the most talked-about business term of this decade. The on-demand economy took shape in the US with companies like Uber and Airbnb. But what seems even more amazing than this, is the fact that 42% of total adult US population have used the services of at least one on-demand startup. This was revealed by a publication on The Street which highlighted a survey report about an on-demand economy which was jointly compiled by Burson-Marsteller, the Aspen Institute and Time.
As mentioned in the on-demand economy stats, 42% of the total US population is a huge number. It amounts to 86.5 million Americans. These numbers clearly show the impact being created by these on-demand startups in the USA and the promising future of the on-demand economy. But wait! Does a huge number like that really mean that this access economy is really huge and does it define the future of the on-demand economy? There would be different viewpoints for this question. In order to figure out some clarity, we at Juggernaut studied various survey reports and came out with the following facts and statistics about the on-demand economy.
On-Demand Economy Facts & Stats (USA)
According to Burson-Marsteller’s on-demand economy survey:
- 86.5 Million Americans (42% of adult population) have used an on-demand service.
- 45 Million Americans (22% of adult population) have offered services in on-demand service.
- 51% of those who offered services in on-demand economy admitted that their financial situation has improved in past year.
- 64% of those who offered on-demand services hope that their financial situation will improve in coming year.
- 51% of people offering services for startups in the on-demand economy are under 35 years of age.
- 41% of people who have used or provided an on-demand service live in urban areas.
According to Intuit’s on demand economy survey:
- 70% of on-demand workers are satisfied with their work.
- 81% of workers in on-demand economy plan to continue working with the same provider over the next year.
- 63% of on-demand workers say that they are happier to be working in the on-demand economy.
- 63% workers say that they are working with on-demand startups to earn supplemental income.
- 46% people working in this economy say they are working because of their flexible schedule.
- 33% people work for more than one platform.
- Only 11% workers said that they work in on-demand economy as they could not find any other job.
For more, Check out this infographic published by TIME : https://time.com/4169532/sharing-economy-poll/
Funding Trends in the On-Demand Economy
The massive funding received by Uber ($8.6 Billion till Feb 2016) and Airbnb ($2.4 Billion till Feb 2016) has created ripples in the on demand funding space. The venture capitalists who missed out the opportunity of investing in these giants are now looking for startups having the caliber to cause the next big disruption. However, if you give a closer look to CB Insight’s “On Demand Funding data”, you’ll see that the trend has come down after a boom in the first quarter of 2015. Refer to the below image:
According to a post on CB Insight’s titled – Unless You’re Uber Or AirBnB, The Mobile On-Demand Funding Boom Has Cooled, VC funding in the on-demand space dropped in the third and fourth quarter of 2015. While this does not define the upcoming funding trend for 2016, but it surely is a matter of concern for some entrepreneurs looking forward to raise huge rounds.
Another aspect to the funding culture in on-demand economy is that earlier there were just 20 venture capitalists investing in on-demand startups but this number has risen to over 200. These stats clearly make us believe that more VC firms are showing an interest to invest in on-demand startups.
With more venture capitalists interested in the on-demand space than ever before, we can positively predict the future of on-demand economy not just in the USA but across many nations where such startups are evolving. It is often said that the big companies of the future in on-demand space are the ones who exist today. But I believe that innovation can never be time specific.
The Future of On-Demand Economy
If you are an entrepreneur looking forward to enter the on demand economy with your own startup then this question would be a million dollar question for you. Although, it is hard to predict the future but let’s try to answer this question with facts and figures.
Taking into consideration the recent investments from venture capital firms and the above mentioned stats about the on demand economy, it can be positively predicted that this new economy is here to stay. On the contrary, many thought leaders believe that we are in the on-demand bubble. Startups are simply copying the Uber model and implementing it in different industry segments. This is the reality of the term “Uber for X”. If things continue the same way, a day will come when this bubble might burst.
Whatever may be the outcome, we have understood that consumer trend is changing and it is time to make changes in business model in order to rise above the competition. Today, we can get almost everything on demand by tapping our smartphone and I don’t think there can be anything easier than this (as of now). Stats have proved that the on-demand economy has so far been good for consumers, service providers as well as technology platforms.
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