2013-01-02

Co.Exist

Why This CEO Doesn't Own A Car: The Rise Of Dis-Ownership

Sunrun CEO Lynn Jurich knows a thing or two about our society’s increasing shift toward the sharing economy.

I know it may seem odd for a business executive, but I don’t even own a car.

We’re living at a time when a major shift in attitudes is bringing on a new era—one in which people get more value by owning less property. And this shift holds the power to change all of our lives, for the better. While it’s not the traditional American dream, it makes sense if you think about what’s defining America today:

An era of sharing

New ways of sharing, driven by online social standards, have taken collaboration to new levels. Thanks to the social web, we can share and trade to use a whole universe of things we once had to buy ourselves. From cars to solar panels, people are realizing they can reap the benefits of ownership without the expense and hassle of buying. For me, not owning a car means I may spend a little extra time on public transportation, but I can use that time to read, catch up on work projects, and make the phone calls I couldn’t get to earlier. Plus, I never waste time at the mechanics or gas station.

The economy

After living through the greatest economic downturn since the Great Depression, Americans have learned that relationships and experiences are more important than stuff, stuff, and more stuff. Take the now-retiring baby boomers. When their wealth was diminished by the financial crisis, they had to take a new approach to purchasing decisions. According to America’s Research Group Ltd. Chairman , "Many retirees are staying in their homes, moving closer to their children or getting smaller houses with less upkeep, instead of traveling or buying luxury items and second homes."

Pocketbook environmentalism

Smart companies have shown Americans how greener choices can actually save them money in one fell swoop. And the people have spoken: If they can go green and save green, they will. In a recent survey my company Sunrun issued to better understand our customers’ motivations, 9 out of 10 Americans of both voting persuasions said they had made what can be considered ‘green’ changes to their lifestyles over the last five years. Their primary motivator? "Saving money." The new status symbol isn’t what you own—it’s what you’re smart enough not to own.

At the same time, companies that target consumers have recognized this opportunity and are helping turn it into a movement. For example, Airbnb users have now booked over 10 million nights of stays in other people’s homes. A survey conducted earlier this year revealed that almost 20% of Zipcar members sell their cars after joining, and nearly half reported that the service allowed them to avoid buying a car altogether. I am a Zipcar user and love the convenience of it both for daily life and travel.

I’ve heard some opinions that this trend of dis-ownership is limited to the young and urban, that it’s just a temporary phase. But, data proves otherwise: While started in San Francisco, it now spans more than 26,000 cities and nearly 200 countries. In cities and small towns across the globe, Airbnb offers multiple choices of places to stay.

It’s common for cultural shifts to start with young, urban adopters before going mainstream. We’ve seen that recently with Facebook. A site that started with college students at Harvard is now a favorite with boomer-generation parents who have embraced this new way of connecting with family and friends. And while we’re back on the topic of the boomer generation: In a recent Pew survey, Americans between the ages 50 and 61 were most likely to report that their household finances worsened and that they had taken losses on their investments since the recession began. The fact that the economic recession has hit middle-aged, Middle Americans the hardest is another reason to believe dis-ownership is headed into the mainstream.

Solar Service

One final example of the rise of dis-ownership: home solar (since I’m in the business). My company invented a way for homeowners to go solar without the prohibitive upfront cost. We call it solar service. Homeowners don’t have to own the panels. We own them, and our customers just pay for the energy they use at a lower rate than they were paying before. Though this might sound like a feel-good, hipster trend, our largest pockets of customers are in median-income zip codes in conservative cities like Fresno and Bakersfield, California. And this movement is bigger than any one city or company: industry data shows that, just five years in, solar service is already more popular than cash purchase in the nation’s top solar markets. In California, seven out of 10 people going solar choose solar power service.

I’m not saying that it’s easy to get people to adopt this new trend. Old habits die hard and people need a real reason to change. It took me years of practice to streamline my own life and decide what I could and could not do without. At Sunrun, we learned that it wasn’t enough to just get rid of the huge upfront cost of going solar–-we also had to take away all the worries of ownership. We did that by assuring customers that we would take care of monitoring, maintaining, and insuring the systems. And after doing all of that, we still face the challenge of many people thinking what we offer is too good to be true.

Nearly every day we hear customers who ask "But isn’t buying always a better deal in the long run?" when we tell them they don’t need to own or even think about the panels on their roofs. We’ve learned that we need to explain to them that when they factor in the cost and headache of owning, our service is better, even if they have the money to buy.

Since the people have spoken, dis-ownership has gotten the eyes and ears of investment hubs like Silicon Valley. For instance, Sunrun investors include venture capital groups like Accel Partners and Sequoia Capital, and institutions like US Bancorp. With their support, we’ve installed over $1 billion in solar systems.

As we settle into 2013, I predict this: We’ll see companies that promote this shift from private ownership thrive. More people will be able to access things they simply don’t need to own, and they’ll save money and live better, cleaner, green lives doing it. The recent apocalypse was actually the dawn of a paradoxical, powerful shift to the era of getting more by owning less.

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36 Comments

  • Philgoroski

    I saved a wopping $144.00 for my first year! Big deal! It seems I did not use enough power to relize a savings. I was raised to try to conserve energy. SunRun said I went from consuming 1400-1500KW to 1000KW. I recently retired and am traveling frequently so I do use less power. When I travel for 30-40 days I turn off all nonessential electrical but, my bill will still be in excess of $300 in the summer months. I am embarrased to tell anybody I pay for what I produce not what I consume, and when I did tell a friend they acted like I was a total idiot, a complete sucker.

  • Anton

    The vitriol from numerous comments here adds to my concerns.

    Americans are keen to adapt as you said, if it is financially beneficial to them. Easy enough for light bulbs and a couple solar panels but as soon as we discuss shelving the private automobile, the knee jerk reaction of Americans in an eternal love affair with car and car culture comes out.

    Additional taxes and fees are probably needed to make car ownership unattractive, in addition to eliminating the abundant free parking that causes suburban sprawl and compounds or energy dependence, environmental, and obesity problems. Then there's the reviled alternatives of "car sharing with filthy plebs", public transport with the even filthier plebs, and the much abused notion of bicycling. With the current political climate of much of America begging for austerity, cutting subsidies to any one of those is met with fanfare.

    Between populist politicians who play to America's collective hatred of the above, global warming denialism, and our own stubbornness, I admit to being a pessimist. We're probably on a fast track to frying our own species into oblivion and don't have much of a care in the world.

  • garethkane

    I think the young are going for 'less stuff, just as much fun' in general. The shift from real goods (CDs, DVDs, photos, books etc) to digital goods (MP3s, ebooks etc) is very real - a whole generation growing up who don't need shelves full of books, CDs and DVDs to show off how erudite they are.

  • Ash Nallawalla

    As a point of view, this is as good as any, and may work for young people for a couple of years. I am reading this in suburban Australia in a city with poor public transport (Melbourne).  Here, as in NZ, the value of a home goes up far more than the intrinsic value of the panels. The electricity company pays me 65c per kWh for power I feed into the grid and I pay 22-25c per kWh for electricity I have to buy during cloudy and darkness hours.

    The kids now have their own cars (!) but them being responsible drinkers, we need to give them a ride at times. When they were growing up, we needed to drive them everywhere.

  • Linden Wilcock

    Awesome. I like this a lot. The status symbol acquisition phase that so many people seem to still be stuck in is so backwards. This goes hand in hand with a quote I really like from GQ's Style Guy, Glenn O'Brien:
    "Let us create a value system of inconspicuous consumption based not on scarce, precious commodities - but on wit, fetish, and imagination." 
    "It's what your smart enough not to own" will stick with me. Thanks!

  • d_hansen

    I think it's a matter of perspective....since the American tax payers are subsidizing your company and that is the only way you stay solvent, they kind of do own it.  Well, maybe not - you own it and reap the benefits, the tax payers just get to pay the bills and prop you up.

  • John Doe

    The Americans have taught consumerism to the developing countries which is causing irreversible damage to the environment. Now we hope they will teach this "dis-ownership" also very quickly to the developing countries. What about American MNCs who are looking at the new markets for all their growth and profit?

  • Elizabeth M

    I really enjoyed reading this article. I also agree that we are moving into evolving  lifestyle although slow it may be. The article does have a great message and turns on a light bulb for new ideas. I would like to see more 'real time' stories to support this article.

  • Alexandros

    I'm sorry to break the news Lynn but this is not a recent apocalypse in any way. Shared ownership has been around since 5th century BC if not even earlier! I am however glad to hear that you actually abide to this way of living. I hope that it is for real and not just part of your green brand marketing strategy...

  • sejn

    Yes, I am Car Free and it is a much better way to live for me and he planet. I enjoy public transportation and also have much better odds of not being hurt or killed in a traffic accident.

  • Nigel Broomhall

    While I can certainly agree that harnessing the energy of the sun is a good thing (versus digging into mountains and burning the fossil fuels (gas and coal) within which is how ~65% of US energy is generated), I think a dimension is being missed. And that dimension is home capital value improvement. I may be wrong Lynn, but it would appear that in the US (as in my home country of New Zealand), consumers obviously don't value the capital improvement provided by a home solar install? If they did then the question of ownership becomes moot - if I can improve my home and increase it's value I'll own the upgrade thank you, I won't lease it.

    For all those who have commented negatively towards your business model, I challenge them to think about how you buy homes. If you ascribed value to domestic energy investments you would never think about leasing solar panels. Until consumers change their perceptions of value associated with a home, Lynn will stay in business (although sorry I don't know about your governments complicated incentive programs so I don't have a view on that). And given that the sun is a cleaner energy source for us all than coal and gas, all power to her!

  • No

    Owning - within your means is almost always the best choice to build financial stability and freedom. You can't spend your way to that.

  • Archita Ray

    I liked the concept of dis- ownership and being smart enough to not buy things. 

    However not sure how will the ownership/ dis-ownership of solar panel will work in places where basic amenities are not reaching. 

  • Joseph Weaver

    What happens when we stop owning our paycheck? The part of it we still own, I mean?

  • Truth Police

    Go ahead, believe this article.  That's what the establishment wants you to believe.  Slim down, streamline, share.  While you all are sharing, the smart ones are scooping up the properties and riches so they can then "lease" it out to all of you sharers and get rich off of your backs.  You will never build wealth leasing or sharing.  And wealth is what is needed if you want to live a comfortable life, provide for your children's futures, and see the world before you die.  "Social Sharing" and "Green Sharing" are the biggest scams ever perpetrated on the masses because the masses are inherently lazy.  It's the perfect wealth re-distribution engine...eliminating the ability of the average joe to climb the ladder, and be subjected to corporate or smarter investor masters.

  • Brink of Reality

    "wealth is what is needed if you want to live a comfortable life, provide for your children's futures, and see the world before you die. "

    That was true in an era where working and building things involved physical action and fixed locations. Today, a vast migration to digital and mobile work means there's no reason to waste energy physically commuting when you can telecommute.  Sharing, renting, and sharing rental property facilitates movement, while strengthening community ties that foster creativity.  Disowning cars means no need to store or maintain them when they aren't needed. These recently-possible changes add up to make it EXTREMELY easy to drop the crap and travel for a living, comfortably.

    I have been doing it for 2 years so far, and there's a whole growing new breed of people out there known as Technomads who follow a similar lifestyle.  Most Technomads have jobs in software or other purely digital pursuits.

    My business partner and I started out brainstorming a way to build a business especially synergistic to a modern nomadic lifestyle. We experimented with security consulting, business consulting, and running a travel agency, before settling into touring security edutainment.  So, even though our current endeavors aren't strictly digital, they still fit well with the disownership, sharing, and nomadic lifestyle.

    The wealth one creates through such lifestyle is community wealth rather than personal wealth.  Years ago, I once said (jokingly) that I wouldn't need to buy a house if 10,000 people had couches for me to crash on. The time for that experiment has come!

    Also, I currently have an awesome apartment in Amsterdam, but I'd rather be in San Francisco for a few months this year.  Anyone want to swap? :)