How worker-owned apps could help reshape the gig economy
Apps like Uber, DoorDash and TaskRabbit are incredibly convenient services for consumers. But when you use these apps, you may want to think about the labor that makes them possible. Workers on these platforms often are working long hours, are significantly underpaid and have no benefits. Attempts by workers to unionize or simply receive improved treatment are often snuffed out by the billion-dollar companies that operate the platforms. Instead of continuing to play by those rules, some workers are starting to build their own platforms that reward laborers with fair wages and even ownership in the company.
Around the world, worker-owned gig economy apps are starting to gain traction. For consumers, the platforms work exactly the same as any other; fire up the app and hail a ride or order food for delivery or get help with a task. The difference is who is in charge. Instead of the app being owned by some serial entrepreneur backed by billions of dollars of venture capital money, these apps operate on a cooperative-style model. The workers are responsible for the platform, and they share in ownership. That means they can set fairer wages and have an actual say in any changes made to the platform.
Earlier this month in New York, hundreds of people interested in this model — sometimes called platform cooperativism — gathered for the Platform Cooperativism Consortium. More than 150 speakers from 30 countries attended the event to discuss things like best practices, navigating bias and discrimination in co-op settings and generally trading tips on how to get set up and operate. According to a recent report from Vice, there are about 400 projects in the world currently operating with the cooperative model and are likely more coming as workers become more empowered to take more ownership of their labor.
There are already some viable alternatives out there to the most popular gig economy apps that use the platform cooperativism model. In Montreal, an Uber rival called Eva has emerged. Built on the premise of being a "socially acceptable" option to ride share giants like Uber and Lyft — both known for tamping down any attempts by workers to organize or press for fairer wages — Eva doesn't seek to make a profit. Instead, it allows both drivers and riders to become members with the ability to vote on any necessary changes to the platform during its annual meeting. Those members will also get a share of any profit that the company generates, should that day come (Uber and Lyft both operate at a loss with a much larger scale). Eva takes just 15 percent for operating and marketing costs, considerably less than the 25 percent that Uber and Lyft typically pocket off each ride — and Eva's membership can change that percentage if enough people vote for it. The creator of Eva recently told Vice that it has a user base of more than 17,000 riders and 500 active drivers, with another 500 ready to join up to drive.
Those drivers won't have to be subjected to the same sudden changes that often frustrate other rideshare drivers, either. Earlier this year, Uber cut driver wages by 25 percent in Los Angeles without warning, sparking protests from drivers. On Eva, those types of changes don't occur unless voted on. Instead, they receive a guaranteed base wage of between $13 and $15 per hour in exchange for agreeing to work set hours in certain high-traffic areas. If the drivers make less in fares than their guaranteed wage, Eva pays them the difference. If they make more, the driver pockets everything.
In theory, the concept of platform cooperativism can address the many shortcomings that the profit-driven model that many gig economy apps suffer from — typically as a result of putting profit motive before anything else. While companies like Uber, Lyft and DoorDash are pouring millions of dollars into lobbying campaigns to urge lawmakers not to classify their workers as employees, the co-op model willingly embraces that status for its workers. Mensakas — a cooperative delivery app operating in Barcelona, Spain — has given employment contracts to each and every one of its delivery couriers, rather than trying to pin them with the "independent contractor" label that many gig economy platforms rely upon. Instead of telling workers that they can "be their own boss" by picking the hours they work — a favorite line of most gig economy apps — cooperative services like Mensakas actually make good on that promise.
If there is a catch that is worth noting with these services as they currently operate, it is that most of them are relatively small. They exist in a single city or region and haven't reached anywhere near the scale of the gig economy apps that would be viewed as their competitors. It's unlikely that these services could ever compete with the likes of Uber or DoorDash or any number of major platforms in terms of sheer volume. The platform cooperativism model may not be competitive in terms of pricing, either. The thing is, they don't have to compete directly, either — they rely on a smaller, dedicated userbase that feels ownership rather than just using the cheapest option in the moment. Uber, Lyft, Instantcart or any other gig economy app you can name operated on a model where they scaled up as quickly as possible, subsidizing the cost with venture capital investments. Those platforms need the massive scale to show the potential for profit. Co-ops aren't worried about profit so much as sustainability. Their goal is to generate enough money to keep the platform operational and the employees paid — everything after that is just a bonus.
That likely means that you won't see Eva make its way to your city any time soon. But it also means that anyone could start their own Eva in your city. Start up accelerators like Start.coop are looking for more platform cooperativism projects to back and help bring to fruition and places like CoopCycle are willing to share software to help get new platforms off the ground. Cooperatives are all about working together, and that includes launching new platforms that will continue that mission.