A New Standard of Responsibility
In the course of one year, the rideshare industry transformed from an expensive black car offering for tech savvy folks to an inexpensive network of cars that changed the way people move around. As is often the case, government sat by and watched the change, only to be roused to action when the incumbent industry and some consumer protection watchdogs pushed for stronger regulation.
At the time of this rapid change I was working for Chicago’s newly-elected mayor. We were supportive of the emerging industry because it created jobs, made much more efficient use of cars that typically sit idle for most of their lives, and resulted in a transportation service that actually served the entire city. We were pretty confident that we could call in the rideshare companies and cut a simple deal: in exchange for creating some rules of the road to protect passengers and drivers, we would legalize the industry as a new transportation option.
We were wrong.
The response from across the table was simple and consistent — “we are not a transportation company, we are a tech company.” The CEO said it, the local rep said it, the paid lobbyists said it. And they all believed it.
Unfortunately, this is a losing argument. Disrupting massive industry comes with a price — you have to take responsibility for the platform you provide, and you have to innovate to ensure it is safe, fair and honest. That means basic validation of the content you’re providing — in this case, safe transportation for passengers — and transparency to be held accountable by the public.
This scenario is replaying itself among social media companies. As fake news is unleashed to peddle misinformation and influence sentiment, the constant refrain of social media CEOs has a familiar ring — “we are not a media company, we are a tech company.” The CEO of Facebook said it, as did the CEO of Twitter.
Down the street, home sharing companies face charges of discrimination and exacerbation of rising rental prices, and have been slow to take responsibility for host behavior or violation of local laws.
Like every investor, we are massive supporters of sharing economy companies that create new industries or disrupt inefficient incumbents. As someone who cares deeply about the future of cities and the people who live in them, I think technology innovation (with the right regulations around them) are key to alleviating many of our current problems. I also believe there is a time to fight entrenched interests and governments when they are solely trying to kill a better idea.
But technology companies have a responsibility to embrace some basic rules. The implications of not taking responsibility are playing out in front of us, and none of them are good. The really smart companies — and certainly the ones we work with — will embrace this responsibility in their infancy and will therefore control the debate and standards before it’s too late.