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November 12, 2015

The Evolving Politics of Airbnb and Beyond

It should go without saying that every local policy discussion is unique. No algorithm – at least that I’ve heard of – can solely help organizations navigate the opportunities and challenges of local policy discussions at the ground level. But much like case law can set precedent in the legal world, it is helpful to deconstruct the latest developments in technology policy to find areas of similarity for those campaigns that worked, and for those that did not.

Take Proposition F, for instance, the recent ballot measure in San Francisco colloquially known as the ‘Airbnb Initiative,’ which contained restrictions on short-term rentals (or ‘homesharing,’ depending on who you are talking to.) These restrictions would have drastically affected the business practices of companies like Airbnb and Homeaway. Or look at the personal enterprise economy, where recent lawsuits regarding the tax status of workers in the personal enterprise economy and a threat of large financial settlement may be driving gig economies out of business.

As we know, Prop F did not pass, and some of the worker lawsuits have been dismissed. And though the dust hasn’t settled yet, recent developments reveal some core foundations for success.

Map The Journey

While companies used to take years to reach scale, businesses built on the Internet can have global reach in a matter of months. Swift growth draws scrutiny, however, and ignorance of regulation and political structure won’t protect a rapidly moving company from being stopped in its tracks by enforcement. In California, the effects of a proposition are sweeping and very difficult to roll back. While spending $8 million on a local ballot initiative seems absurd, knowing the actual political consequences of said proposition tempers the sticker shock.

For companies like Airbnb, the passage of a sweeping ballot measure like Prop F would not only have impacted business practices, it would have created a terrible precedent, opening the door to wide-reaching privacy issues, and altered the nature of local criminal and civil litigation. Rolling those changes back would have required ANOTHER proposition, or a court challenge. In terms of worker status, a reclassification via lawsuit would completely upend business models for companies like Handy quickly. In both cases, knowing the real impact of a regulatory or legislative change allows for companies to set the narrative and avoid a reactive/defensive posture.

Empathy Matters.

Everything you put out the door reflects on you: every piece of content in the public sphere will be attributed to the company as a whole. No matter how your org chart is structured, no matter who interacts with which consultants, no matter how small the budget line item seems in comparison to the rest of the campaign, every element matters. Airbnb took a major hit with the notorious ad campaign it released in the week leading up to the campaign. While the content might have been innocuous in any other context, the storm around the election was only fuel for the following outcry fire.

Preparation Prevents Perspiration

Across the country, technology companies are playing regulatory whack-a-mole. This is not the startup world of yore: gone are the days of moving fast, breaking things, and not really paying attention to regulation. As new ideas take flight, not being able to find the playing field is now a serious liability.

After the dust settled last week, Airbnb’s new Chief of Policy Chris Lehane deliberately outlined how they’ll be taking their message of community and inclusion nationwide. Lehane shifted the narrative by acknowledging the concerns of municipalities while drafting the users of Airbnb to fight on his behalf.

The best way to win these fights in the future is to prepare for them. That’s why sharing economy companies are starting to develop regulatory principles for this emerging gig economy.

Last week, dozens of individuals signed an open letter encouraging lawmakers to consider finding a “common ground for independent workers.”  As a crucial element of the American worker system, adjusting the ways Americans can invest in themselves in the age of flexible work will be the next great employment benefit fight.

Additionally, Airbnb released a “treatise pledging a renewed spirit of cooperation.” In it, the company communicates plans to normalize relations with municipalities across the country. This forward-looking acknowledgement of local politics, and recognition of the role of local government in these issues, signals a new chapter for the company in their ongoing regulatory developments

These issues will not disappear. And while regulatory issues remain for changing industries, it seems that the path forward may be changing, dare I say for the better.

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