Shared economy giants Airbnb and Uber have disrupted established but inflexible ways of doing business in the taxi and hotel industries. Now it may be time for Uber and Airbnb to suffer some disruption of their own.
Cryptocurrency innovators are pondering the established shared economy providers and detecting some potentially lethal weak spots.
Consider Beenest Inc., a California company poised to move into Airbnb’s space with a new, blockchain-based, home sharing platform that the company says will offer bigger profits for hosts and cheaper, more secure services for guests.
Beenest ran its own Bee Token ICO earlier this year, reaching its target goal of $5 million in 20 days. The company is the brainchild of a group of engineering friends from the Bay Area, most of them with valuable administrative experience in shared service venues like Uber, Facebook and Airbnb.
The problem with the top-line sharing services is the lion’s share of profits goes to the platform, said Bee Token CEO Jonathan Chou in a 2017 interview.
“You’ve heard the Uber drivers complaining that they’re not making any money,” says Chou, a former Uber executive.
As traditional companies grow in value, all the value is captured by a handful of people, Chou said.
“Uber went from zero to $70 billion,” he said. “For all the founders, their stock is appreciating like crazy. But drivers or people who actually use the service don’t see that. Drivers are complaining they’re actually making less and less money.”
In Chou’s interpretation, the “tokenization” of the hospitality network democratizes the financial side of the business, with “everyone having the token, not just a few people.”
Beenest’s principal focus is now providing a better alternative to Airbnb. “We’re removing the middle men, taking the 15 or 20 percent commission that Airbnb has and sharing it,” Chou said in a 2017 interview..
Airbnb has shown some interest in blockchain technology. In 2016, the company acquired ChangeCoin, whose technology allowed consumers to send money in small increments via Twitter and social media channels.
Beenest is in the process of scaling up a hospitality network, which will make its first appearance in San Francisco in the next two months and extend to five U.S. cities by 2019, including some on the East Coast. By 2020, Beenest expects to be in London, Korea and Singapore.
The blockchained network offers much higher levels of security from breaches by hackers or Big Brother data accumulation than centralized companies. “We [guests] want privacy,” cybersecurity expert Greg Wolfond told Huffington Post recently. “We don’t want something tracking where we want to go.”
Blockchain, with its data spread in bits around a vast computer network, offers that level of security. Beenest will also provide an arbitration panel for disputes between hosts and guests.
The Bee Token is a big part of the total package, says Chou, who served as head of security for Uber before joining Beenest. Possession of the Bee Token provides a zero-commission deal for Beenest network guests, with a small fee for Bitcoin or Ether holders and larger fees for fiat.
“We want there to be options in the market,” Chou said in a live-streamed interview last November. “So we want all the value that the guest and the host to be fully given to the guest and the host.”