When I was thirty and single and living in New York City, I had a dream: to return one day with my husband and push our baby in a stroller through Central Park. A few weeks ago, albeit more than a decade later, my dream came true. But we didn’t stay in a hotel and travel by yellow cab, instead we used Airbnb to book a guy’s condo on the Upper East Side and we travelled by Uber to the airport.
Ironically, although I have been on an intellectual journey for the past four years developing my Social Capital investment thesis, it was only when I undertook this physical journey (I travelled East to speak at the CFA Society Toronto event “Social Media’s Impact to the Investment Process”) and used Airbnb and Uber for the first time, that I realized the radical power of Social Capital. How is it that Airbnb and Uber have been able to build thriving ecosystems in just over five years with such significant scale and influence that they are now valued at $10 billion and $12 billion? And how have these companies become such a disruptive force that they are the target of deafening protests from the highly ensconced hotel and taxi industries in cities around the world? Two words: Social Capital.