A greater confidence in the sharing economy from older generations could help the sector continue to grow exponentially, a director of a mergers and acquisitions firm believes.
Speaking to Travolution after pwc released its Sharing Economy 2017 predictions report – which forecasts the sharing economy could rise from £7bn-a-year economy could be worth £140bn-a-year in the UK by 2025 – Gavin Orde of Livingstone Partners said a greater uptake among older travellers could drive growth.
He said: “It’s increasing within the older demographic, who are getting more and more confident about using technology and the sharing economy.
“From a travel perspective, they have significantly more disposable income than younger generations.”
He said there was less room for growth within the younger ‘millennial’ generation, of which he said 99.9% are already using the internet.
Orde, a chartered accountant, said he thought the pwc forecasts were ambitious but said he continued to see strong growth in the sharing economy.
“I don’t think it’s doing to plateau,” he said. “I think it will continue to grow and continue to grow pretty strongly. There’s still a long way to go and a lot of runway for these businesses.
“Whether or not it will reach 140bn is difficult to say. Pwc has come out with that number but I don’t think they’ve broken it down to exactly how they are going to get there.”
The pwc report also said it anticipated a rise in silver surfers using the sharing economy and that the Office for National Statistics beginning to record data on the industry this year will help better understand the potential of the sharing economy’s growth.
Orde said he also expects larger companies like Airbnb to further explore the town planning market, after news that it had launched its Samara urban planning programme in Japan.
“I expect that they [large sharing economy companies] will continue to look to broaden their product offering and engage more deeply with their consumer base.
“Airbnb are getting into architecture and town planning. They are looking at ways to influence their built environment and make it more user-friendly.
“We may see home swap platforms looking into more mainstream rental of villas, houses and cottages. It’s constantly trying to expand its inventory.”
Regulation of the sharing economy – signed off in the UK last year – was also pivotal in helping new start-ups grow, he added.
“Legislation has to keep up,” he said. “It was not designed with these business models in mind. I think that is why this has been looked at and worked up and I’m sure that the right way for the platforms to deal with it is to engage and help try and shape whatever updates are needed.
“It [the sharing economy kite mark the government signed off last year] is a sensible route to go down. It helps build trust for both the consumer and the provider. That kind of self-regulation is likely to result in more benign responses from the authorities in some of these areas.”
“The platforms are demonstrating that they are trying.”
Livingstone, which helps medium-sized businesses scale, has yet to work with any prominent sharing economy businesses but Orde said with more on the market he could see that happening in the future.
He might just be helping the sharing economy get closer to being worth £140bn.