Published On: Sat, Aug 15th, 2015

Lessons from Seoul’s Two Sharing Economies


As a Fulbright grantee, we spent partial of a final year researching a pity economy in Seoul. One of my categorical findings? Korea indeed has two.

The initial is small-scale, hyper internal and insubordinate in flavor. This initial “sharing Seoul” is mostly upheld by a Seoul Metropolitan government, and consists of a handful of amicable entrepreneurs mostly operative by ShareHub, an tusk of a Korean section of Creative Commons.

The second is a frigid conflicting of a first, and encompasses Airbnb and Uber, a enormous, multinational companies that sojourn those best compared with a reign “sharing economy” worldwide.

However, in Korea, and also around a world, it is increasingly clear that to embody this latter difficulty of companies underneath a pity tag is a mistake.

Four years after TIME repository named “Sharing” as one of a “10 Ideas That Will Change a World,” and as companies like Uber spin increasingly politicized around a world, it’s time to re-examine a “sharing economy.” Indeed, we competence be means to reap some judgment insights from a engaging juncture maturation in Korea.

What Is The Sharing Economy?

As we use it today, a reign “sharing economy” encompasses a extended operation of activities, from renting to bartering to gifting. At a many elementary definition, a reign refers to when tellurian and earthy resources are common between individuals, generally with a assistance of an online height or marketplace.

As a domestic ideal, a pity economy is a amicable indication in that products and services are distributed directly between consumers by peer-to-peer interactions. Environmentalists have even looked into a pity economy as a approach to revoke CO footprints while needing mercantile growth.

Shareable, another online community, describes a “sharing transformation” that includes “maker movement, collaborative consumption, a oneness economy, open source software, transition towns, open government, and amicable enterprise.”

When pity replaces new consumption, there has always been a intensity to quell costs and revoke waste. In a classical example, instead of shopping a new toolbox when we need to use a hammer, we steal one from my neighbor. I’ll retaliate this goodwill during some time in a future; maybe she’ll need my garden hose subsequent week.

With a appearance of a Internet and near-instant interconnection, it becomes many easier to compare these haves and needs as they start in genuine time, formulating a intensity for digitally powered pity services. “Anyone have a hammer?” we post to my area Facebook page. “Be right over,” responds my neighbor.

The judgment of pity took off in a late 2000s, maybe as a amicable and domestic greeting conflicting a hyper-capitalism of a DOT COM epoch — a digital rebranding of aged insubordinate and on-going ideals, if we will. Companies like Zipcar were founded; Amazon started distributing little tasks to an Internet workforce by Mechanical Turk.

However, a reign “sharing economy” has always been a tiny problematic: As Giana M. Eckhardt and Fleura Bardhi note in a Harvard Business Review, loyal pity is a amicable communication that involves no exchange or profits, like books during a open library.

For this reason, many of a loyal believers in a pity mutation have wholly deserted a term, mostly in preference of a reign “collaborative consumption.” For a rest of this article, this is a reign we try will use to report this mutation formed on peer-to-peer sharing.

According to a classification OuiShare, borrowing heavily from a work of pity preacher Rachel Botsman (who runs a eponymous web portal “Collaborative Consumption”), “the collaborative economy is tangible as initiatives formed on plane networks and appearance of a community” and is built on “distributed appetite and trust within communities as against to centralized institutions.” In collaborative consumption, “the lines between writer and consumer” are blurred.

Truly, a proliferation and seductiveness in these behaviors and services has been remarkable. A new investigate by PwC speculates that this new zone competence grow to $335 billion in tellurian revenues by 2025.

Individuals like Ms. Botsman, a author of What’s Mine Is Yours, a pity manifesto, Apr Rinne, a Harvard-trained counsel and Arun Sundararajan, a NYU professor, have finished whole careers consulting for companies and governments — including Seoul’s — with courtesy to a collaborative economy.

Seoul building during night.Namsan Mountain in koreaImage: Shutterstock/Guitar photographer

Seoul’s Sharing Economy

Seoul is indeed an early adopter when it comes to a sharing/collaborative economy. Although many of a press insinuates a pity economy initiatives have been borne out of startups, Korean collaborative expenditure efforts indeed predate a stream startup boom.

Seeded in 2012 by former tellurian rights counsel and Seoul City Mayor Park Won-soon, a “Sharing Seoul initiative” sought to alloy a several ills of complicated multitude by compelling this kinder, gentler form of capitalism.

South Korea’s mutation from a tiny, destitute, war-ravaged nation to a festive mercantile and informative workhorse is zero brief of extraordinary. In a 65 years following a Korean War, South Korea has bootstrapped itself to spin a abounding tellurian record personality with an enviable soothing appetite grip, carried by a undulating moves of K-Pop idols to a distant corners of Asia and beyond. In a U.S., Korean food has even spin vast among cultured Brooklyn hipsters.

South Korea is a customarily nation to transition from USAID (U.S. Agency for International Development) target to donor, replacing unpaved roads and alfresco latrines with high-tech infrastructure that mostly seems ripped from a fantastical architectural rendering.

Of course, this cruel expostulate to self-ameliorate has come during a cost. South Korea is now experiencing rising inequality, and a decrease in a amicable gratification complement that has disproportionately impacted a elderly. Birth rates are also declining, as educational and vital costs skyrocket.

Thousands of burnt out teenagers toil by a beef millstone that is a South Korean educational system, and 80+ hour, six-day work weeks are a normal for South Korean workers. Korea also has some of a tip rates of ethanol expenditure and self-murder in a OECD (Organisation for Economic Co-operation and Development).

The foe for space is real, too. Nearly 50 percent of a whole race is centered in a Seoul civil area, and during 16,700 people per block kilometer, or 8 times a firmness of New York, Seoul has one of a tip civic race densities in a world. But this implausible firmness doesn’t customarily stop during humans; it relates to their things as well.

Korea is home to “some of a many crazily celebrated consumption,” says Albert Hahn, co-founder of a craigslist-like startup HelloMarket. “In Seoul, we see people operative for $3 an hour, right subsequent to someone sitting in a Maserati. And it’s not like Seoul is a city we can unequivocally expostulate in,” he added.

Pierre Joo, a Parisian who runs a Korean bureau of a French consulting organisation Attali Associés, agrees, adding that he has started to see a “realization by Korean consumers that their mercantile model, prevalent capitalism, is not sustainable.”

New arrivals to a city fast adjust to a high rates of business turnover. In certain neighborhoods, whole buildings are razed and new ones erected clearly overnight.

Even convenience is a rival sport. Photos of must-have equipment widespread virally over Instagram, promulgation a masses on shopping sprees, before descending off a trend car customarily as instantly. Disturbingly chipper floor-to-ceiling advertisements in a metro stations of stylish Gangnam neighborhoods remind riders that if we have a money, we could even buy a new face, if we wanted to.

It’s not tough to see a interest of a pity economy in Korea, as a mutation that hurdles a thought “that nonstop mercantile expansion leads to widespread prosperity; and that some-more things leads to some-more happiness.”

This is utterly loyal for Korea’s unhappy millennials: Despite being innate during a time when they can reap a full advantages of South Korea’s mercantile development, these asocial girl have some of a bleakest views toward a destiny in a world.

They’ve even come adult with a jul-im-mal (줄임말) or jargon abbreviation, for themselves: oh-poh sae-dae (오포 세대), a era that has “given adult on dating, marriage, carrying children, personal relationships, and home reign due to a problems of life.”

From a chronological and informative perspective, a introduction of collaborative expenditure in Korea also creates sense. Many of a values it represents are evocative of a bolshevist traditions of Korea’s not-to-distant past.

As recently as a early 1980s, tools of a Gangnam district were lonesome in rice paddies, and Korea’s agrarian traditions embody a proto-sharing economies of gye (계), village lending circles, poomasi (품아시), non-monetary labor exchanges and du-rae, (두레) organisation labor collectives.

Beginning in early 2013, Seoul upheld a series of ordinances and internal laws to promote a widespread of pity practices, spending 286 million KRW (about $260,000 USD) to support village building around “the pity economy” and deposit in 42 pity business or organizations. At a core of Seoul’s collaborative economy is an classification called CC Korea.

The internal section of a general Creative Commons organization, underneath a charge of Mayor Park, CC Korea operates ShareHub, that serves as a believe bank and clearinghouse for all things collaborative in Seoul. (Naturally, Jennifer Kang, who now heads adult CC Korea, is also a horde on Airbnb.)

ShareHub has hold workshops for girl and village leaders in Bulgwang, an shabby district in northwestern Seoul, and has helped dual other Korean cities, Busan and Daejon, start their possess pity initiatives.

Seoul’s care in this space was praised internationally as “a indication for a world,“ and resulted in a internal bang in small-scale amicable enterprises and startups. However, dual and a half years into a Sharing Seoul program, unequivocally few domestic services have managed to go mainstream.

Most of these services can’t unequivocally scale by design: Among Seoul’s designated pity companies are Dreaming Acorn, a height for pity baby and maternity clothing, and Run Piano, a plan that installs used pianos in open spaces.

None of these companies seem to spin vast profits; one difference competence be SOCAR, a car-sharing use with a business indication same to that of Zipcar in a United States. SOCAR recently perceived $18 million dollars in appropriation from Bain Capital.

In fact, a minimal- or zero-profit indication competence even be a bottom pattern for a loyal collaborative expenditure firm. After all, it does seem to improved aligned with a elemental suggestion of sharing.

As children we are taught, “sharing is caring,” a thought that seems somehow diluted with a introduction of money. we feel like a pre-school clergyman (unless she is Ayn Rand) would be frightened by an “Uber for playgrounds” scenario, in that we direct lease from my playmates for a right to float in my Little Tyke Cozy Coupe, even if I’m not regulating it myself.

shutterstock_296639477Image: Yevgen Belich / Shutterstock.com

Airbnb (And Uber?) In Seoul

On Airbnb’s categorical alighting page for travelers meddlesome in visiting Seoul, white content is superimposed over an aerial shot of a N-Seoul tower. “Palatial corpse and romantic cocktail enlightenment strike in Seoul, a dizzyingly elaborating city that dares we to keep up,” it reads.

Locals adore “Korean grill and soju” and “relaxing during Jjimjilbangs,” while they protest about “traffic,” “rising skill prices,” and “everything changing too quickly.”

Elsewhere on a site, Airbnb entices a would-be traveler: “Belong here, go anywhere.” In Korea, as in a some-more than 190 other countries a association operates, Airbnb has styled itself as a ultimate lodge industry, a business carried out in someone’s home.

Airbnb is a flagship of a supposed pity economy, and is a customarily vast organisation of a difficulty to unequivocally work in Korea. The online marketplace for accommodation combines Orbitz with online dating, relating travelers with hosts and short-term rentals, in further to moderating remuneration and communication between a dual parties.

Founded in 2008 by dual Americans who started subletting their vital room in sequence to make lease on their San Francisco loft, it was creatively marketed underneath a unwieldy URL “airbedandbreakfast.com.”

The association has gifted duration expansion in a past few years. With 550,000 listings worldwide, and some-more than 600 employees, Airbnb is now valued during $10 billion USD. According to estimates, final year Airbnb facilitated bookings for 37 million nights.

The comfortable and hairy feel of Airbnb’s offered is customarily one instance of a celebrated pursuit they have finished offered belonging to Koreans inspired for comfort and connection, a multitude on a fork of burnout after decades of untrammeled development.

In Korea, Airbnb has flourished underneath Seoul’s sharing-city routine initiatives. It has also been a strike among urbane, well-traveled Seoulites. In fact, Airbnb’s astonishing success in South Korea led Seoul to be profiled along with London and San Francisco in a initial emanate of Airbnb’s in-house transport magazine, Pineapple.

Airbnb has not expelled any central statistics on their business in Korea, though by prudent branding and internal marketing, Airbnb has spin a sleeper hit. There are thousands of Airbnb listings in Seoul, and a use now accommodates equal volumes of inbound and outbound travelers in Korea.

For inbound travelers to Seoul, Airbnb can still generally offer a cost assets over normal liberality options, as good as capacitate longer trips and organisation travel. Airbnb listings also paint some-more different neighborhoods than normal hostel or hotel districts, proffering a some-more “authentic” transport knowledge to foreigners.

In an spontaneous check we conducted of 39 Americans, of a 32 that had used Airbnb in Korea, 17 (53 percent) responded they chose a use over other options since it was cheaper, some-more available or some-more interesting.

This comes notwithstanding Korea’s repute for being a notoriously fussy marketplace for unfamiliar companies to enter. Elsewhere in a record sector, even Uber has floundered in a authorised fen (that is a another story over my compensate class in this essay, though greatfully feel giveaway to email me about it later), and after unwell to set adult services underneath its own brand, eBay eventually entered a Korean marketplace by appropriation a internal auxiliary (and eBay copycat), Gmarket.

Airbnb’s Korean success also defies informative barriers seen in other East Asian countries: In Korea, a home is seen as an intensely private space. The same emanate gave Airbnb difficulty when recruiting hosts in Japan, a routine they impute to internally as “supply acquisition.”

Airbnb has built a strong user village in South Korea by doing what startup folks call localization, tweaking a product for new marketplace entry, easy internal enlightenment and needs in sequence to benefit a foothold in a market.

Part of Airbnb’s plan here has been to give a Korean organisation a celebrated grade of liberty and ownership. Even Airbnb’s executive organisation has left local: At a commencement of his reign and in prior roles during Google Korea, a conduct of Airbnb Korea went by his English name, Patrick Lee. But recently, he has been introducing himself with his Korean name, Jun Kyu.

Airbnb maintains a lightweight, all-Korean sales and offered organisation in Seoul that operates out of an bureau in swanky Yongsan-gu, customarily around a dilemma from a Itaewon Park Hyatt. On tip of their promotion blitzes, a Seoul bureau also binds unchanging “host education” events and Airbnb village meet-ups, and is obliged for any Korean-language business around a world.

In Seoul, Airbnb has left after a hip millennial demographic with pitch-perfect internal offered campaigns. Its promotions partnered with internal appetite bloggers, pivotal tastemakers in all-digital South Korea, and intent with intensity new users in a stylish neighborhoods of Garosugil, Gyeongridan and Yeonnam-dong. For example, Airbnb recently sponsored an art repository called Don’t Panic, openly distributed around hip hotspots in Seoul.

Airbnb has finished many to ingratiate itself with little business and artistic communities, as well; it was a marquee unite for Seoul’s 2014 Design Week, putting together a thick red pamphlet of 170 little businesses and featured Korean “design spots,” trimming from Gentlemonster, a reward Korean sunglasses code adored by Korean celebrities and a likes of Jessica Alba and Miranda Kerr, to Soohyang, my possess favorite internal candle maker.

Airbnb Korea also gets points for their efforts to keep a good attribute with Seoul’s City Hall and with a Korean inhabitant government. The authorised and routine teams for Airbnb’s Asia-Pacific multiplication are indeed formed in Singapore, though members of their organisation have told me that they find to “stay in consistent communication” with a internal governments.

They are always seeking about “what they can change or change.” Given a enormity and farrago of a Asian market, that is a third largest in engagement distance after a U.S. and a E.U. for Airbnb, that organisation has many on a hands.

Airbnb isn’t customarily renouned in Seoul. Areum* is a bright-eyed university tyro who hosted me in windy, strand Aewol-eup on Jeju Island. One night’s stay in her gangling bedroom cost me and a crony about $15 each, and in a morning, Areum took a selfie and chatted with us while feeding us peanut butter toast.

In 5 months, Areum had already had around 30 guests, and her proclivity to start hosting on Airbnb was to make a many of an underused space after relocating into her university dorm.

In this assembly of new needs with existent resources, a declaration of a collaborative expenditure mutation still resonates. This healthy enterprise to “make a many of things” was echoed by another immature Korean horde we met and spoke with, by chance, on a transport in Seoul. She runs a inventory for dual bedrooms in her parents’ home in Busan, that were recently vacated when she and her hermit left for university and troops service, respectively.

But arguably, engagement a stay on Airbnb is not loyal collaborative consumption. In Korea, as in many other places, Airbnb offers a brew of loyal home pity and a little business height of sorts. Many of Airbnb’s listings are for tangible hostels or bed and breakfasts, or an unit customarily used for short-term rentals.

Minsoo* is a co-founder of a startup formed in Seoul, and for a past year and a half, he and a few friends have pooled some income in sequence to jointly lease out a four-bedroom skill in Gangnam that they in spin work as an Airbnb, bursting a profits.

When he tells me this, we can’t assistance though consider that this is truly collaborative capitalism. Minsoo is a prototypical entrepreneur, always saying new business opportunities. “I saw a need in Seoul for vast organisation accommodation,” he stated. “People on family vacations or roving for weddings mostly need six-to-eight-person occupancy rooms, and oftentimes a customarily options for these parties are costly residency hotels.”

For Minsoo, hosting on Airbnb has spin an “affordable side job.”

While a series of people are still out there on a site renting out their couches and vital rooms, a arise of veteran Airbnb hosts means that it is no longer accurate to impersonate a association as a pristine peer-to-peer company. The primary attribute during interest is not between a horde and guest, though between a user, be it a horde or a guest, and a corporation, Airbnb.

Especially compared with a equivalent use Couchsurfing, where accommodation is organised for free, critics contend Airbnb has spin customarily another vast association squeezing increase out of a users, exacerbating gentrification and foe for space in certain cities.

There has not been a same debate over Airbnb in Seoul as there has been in New York or San Francisco, where many explain Airbnb is lifting home prices and spiteful locals who count on affordable housing supply. However, this competence be customarily since a series of Koreans on Airbnb has not nonetheless reached critical mass.

More and more, Airbnb is apropos about a bottom line. we initial met Jinju Jeon, a manager of a Korean startup media height BeSuccess, by her Airbnb listing. Jinju likes how Airbnb hosting gives her a event to network and accommodate people endangered in startups outward of Korea.

Jinju has friends who met their contingent bosses on Airbnb, and she also referred me to 3 of her friends in Korea who also work in startups in further to hosting on Airbnb. However, as an active host, Jinju says that some of a offered campaigns have burnished her a wrong way. “The association is flourishing so fast that it had to scapegoat some of a strange identity,” she says.

She was discerning to scold a “social enterprise” picture Airbnb infrequently tries to project, with narratives about how Airbnb revenues can keep low-income people in their homes or exaggerate smaller environmental impacts than normal hotels. At slightest in Korea, “hosts are customarily utterly good off…“ she said.

The bad in Korea tarry in “unlivable conditions,” and so are not in a position to accommodate general travelers. Seen this way, Airbnb can be seen as a approach that a good off can keep enriching themselves. Rather than a heal to cutthroat capitalism, Airbnb, like Uber, competence be capitalism run amok.

Spare hammers, a few mins of downtime, a gangling bedroom: all becomes a commodity with a price, simply permitted to those with a means with a elementary appropriate of an app.

Discussing these issues with a crony in Seoul, she remarked on a tragedy within Airbnb’s values of belonging. While building village is deeply embedded in a collaborative expenditure movement, Airbnb is about tourism, radically a conflicting of staying in a place — and by extension, a conflicting of contributing to a economy sustainably and creation a place bearable long-term.

Jeju IslandImage: Flickr/Republic of Korea around a CC by-SA 2.0 license

A Shared Way Forward?

Thus, Korea’s dual “sharing economies” are relocating in conflicting directions. One operates during a microscale, comprised of dedicated people requesting pity beliefs to build communities in Seoul. Their operations are on a fringe, generating customarily adequate income to keep a services alive. The other is increasingly capitalistic, driven by tellurian flows of income and people.

Yet, notwithstanding their anomalous paths, these dual movements continue to be lumped underneath a same term: pity economy. For a part, Airbnb, swelling underneath a difficulty and container increasingly concomitant a term, has also spin heedful of a tag “sharing economy.”

However, a reign is being formalized elsewhere. A “sharing economy” congress has sprung adult within a U.S. House of Representatives, and as a “Sharing Economy” trade physique was recently set adult in a U.K. Korea, for a part, is also adhering with a reign “sharing,” or gongyu (공유), to impute to both Airbnb- and ShareHub-type sharing.

All this begs a question: What, if anything, do these dual forms of “sharing” have in common?

One thing competence be a common DNA of creation and entrepreneurship. Whatever criticisms or qualms we competence have with Airbnb’s tellurian plan or branding, this whole difficulty of authentic home-sharing practice was not probable in a approach that it is now before a appearance of Airbnb. What Airbnb has finished is revolutionary.

It took a fringe, hippy thought and remade it into an whole mercantile sector. Similarly, a activities of ShareHub and a allies are a depart from a standing quo of contemporary Korea, and a advocates competence even report their aims as to “disrupt” certain governmental conventions.

Back on Jeju that Apr morning, withdrawal Areum’s unit and after walking around a circuitously residential area arrayed with yellow canola and pinkish cherry blossoms, Airbnb still felt like some little partial of a remedy to over-commercialization.

At slightest in Korea, a collateral city of Seoul is a core of sobriety for a economy. Its lift on businesses and immature people is immense. With all of this appetite sucked toward Seoul, smaller towns are increasingly reliant on tourism for revenue.

Increasingly, Koreans are apropos endangered over how certain tools of Korea — Jeju inaugural among them — have mislaid their character because of commercialization.

Airbnb, while flawed, feels like one of a few opportunities we do have to try to keep during slightest a few tourism dollars within internal communities. Rather than profitable income to an general hotel developer who competence track income out of Jeju, we paid my internal host, Areum… and a elect commission to Airbnb.

To me, following a twin narratives of a pity economies of Korea has highlighted how a “sharing economy” mutation has reached a indicate of transition. At this point, a pity economy is mature as a buzzword. But when it comes to tangible impact, it competence still have a prolonged approach to go.

Going forward, can a collaborative expenditure stay loyal to core values of amicable impact and sustainability, or will exile capitalism intensify inequality? Can pity enthusiasts navigate this temperament predicament though entrance too jaded?

Either way, people discontented with a state of things, and fervent to emanate a destiny indication for a improved life, are pushing forward both forms of a pity economy in Korea. More expected than not, conjunction common pianos nor rentable bachelor pads will be a surefire sheet to destiny complacency and wealth — though creation around anticipating new ways to make a many of what we have customarily competence be. As such, maybe both kinds will play tools in the common future.

*Some names have been altered to strengthen privacy.

Featured Image: leungchopan/Shutterstock

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