Background: For the past year, SmallBusiness.com has been exploring the topic of the emerging “on-demand” economy, a term coined to describe an app-enabled marketplace that instantly matches those who need a product or service with providers of such products and services. The largest and most visible example of a real-time, on-demand marketplace is the ride-sharing company Uber. So many start-up companies are modeled after Uber (for markets other than ride-sharing) that tech and finance pundits refer to them as “Uber for X” businesses. Other terms used to describe the on-demand economy, or facets of it, include the “sharing economy,” the “access economy,” the “gig economy,” the “1099 economy” and others.


Some of the biggest brands serving the small business market—like Intuit—are recognizing that the on-demand business model is growing what is already the largest segment of small businesses,  “sole proprietorships” or a “single employee” businesses. (See our description of the Four Categories of Small Business.)

New products are being developed for on-demand service providers

According to Intuit CEO Brad Smith, the on-demand economy “reduces the friction and risk associated with starting a business.” This is leading Intuit to “re-imagine” its financial products to serve these new entrepreneurs. Their first product developed for this on-demand economy category is a QuickBooks Self-Employed product. “The new product helps users untangle their income streams and get a handle on their tax situation,” Smith says. “It’s saving self-employed customers $3,800 on average in tax savings annually.” According to Smith, QuickBooks Self-Employed “is just the tip of the iceberg in terms of what we and others—in both the private and public sectors—can do to support these new entrepreneurs.”

The emerging policy debate: Employees or sole proprietors?

As we’ve reported (see a list of other stories appearing at the top of this page), there are many regulatory and legal threats by city, state and federal agencies that seek to classify on-demand providers as employees, not self-employed. However, the future of on-demand economy opportunities for independent workers hinges on a policy environment that is flexible for service providers. U.S. Sen. Mark Warner (D-VA) and President of Purdue University and former Gov. Mitch Daniels (R-IN) are advocating that local, state and federal lawmakers create the type of regulatory environment that supports the on-demand economy’s roles in business creation.

How does the on-demand economy help develop “companies of one”?

According to Steve King* of Emergent Research and a regular contributor to SmallBusiness.com, here are some reasons why the on-demand economy provides a solid framework for the creation of single-employee businesses (sole proprietorships):

  • There is less time, effort and money associated with getting a typical one-employee business up and running
  • On-demand jobs can be arranged in a matter of hours or even minutes via the internet
  • (In most cases) schedules are completely under the control of the worker and workers can stop or start their work whenever they want.
  • On-demand platforms provide access to customers, one of the biggest challenges associated with starting any business

“We’re early in the game, but the potential to fuel a whole new wave of innovation and support an expanding entrepreneurial population is before us. We must lean in and find ways to help this new breed of entrepreneurs truly thrive.” – Brad Smith, CEO, Intuit


*Disclosure: Steve King and Emergent Research have conducted research for Intuit.


Photo: Uber Australia

15
The Five Faces of the On-Demand Workforce

Participants in the on-demand economy fall into different groups, different motivations and different levels of satisfaction.

16
Small Businesses Using On-Demand Economy to Access Tech Talent Pool

Because of the wave of on-demand economy companies, even the smallest of small businesses can use an app to connect with independent tech workers.

17
Yelp Joins Google, Amazon and a Slew of Startups in Home Services On-Demand Marketplace

Yelp adds Request a Quote feature to participating service providers.

18
Uber Settlement Defines Drivers as Independent Small Businesses, Not Employees

Uber has agreed to a class-action lawsuit settlement with drivers in California and Massachusetts

19
Shopify’s Ecommerce Merchants Can Now Offer Local, Same-Day Delivery in 200+ U.S. Locations

Ecommerce software provider Shopify is teaming up with on-demand same-day delivery service Postmates.

20
Uber Didn’t Create the On-Demand Economy, The On-Demand Economy Created Uber

Uber exists because of the growing need for highly flexible part-time work to supplement incomes.

21
Voters’ Decision Keeps Austin Too Weird For Uber, Lyft

Uber and Lyft, the ride-sharing, on-demand economy companies, lost a key vote by focusing on the wrong messages.

22
Employers Prefer Full Time Workers, But Agree That On-Demand Economy is Here to Stay | 2016

Employers have a love-hate relationship with the on-demand economy.

23
The On-Demand Economy Workforce Continues to Expand | 2017

Two-thirds of on-demand economy participants say they are satisfied with their work

24
HomeAdvisor Buys Angie’s List to Grow its Home Services On-Demand Marketplace

To compete with the giants creating new, on-demand home services marketplaces, HomeAdvisor acquires Angie’s List.