| Hey all, it's Eric. What will the coronavirus mean for the sharing economy? "Sharing economy" is a phrase that faded away once people became disillusioned with the Ubers and Airbnbs of the world. But in the context of a communicable disease the sharing moniker seems relevant. What happens if, as many expect, Covid-19 spreads deeper into the Western world?
The impact of epidemics on tech services has been mixed in China. Authorities shut down ride-hailing in Wuhan and prohibited drivers in Beijing from ferrying passengers into or out of the city. Drivers are reportedly installing plastic dividers and wearing masks. But delivery workers remain an important part of the urban economy—while providing customers with printouts assuring them that that no one with a fever touched their food. The 2002 SARS outbreak actually had a "curiously beneficial impact on the Chinese internet sector," because people shopped online while holed up in their homes, according to a biography of Jack Ma, Alibaba Group Holding Ltd's co-founder. (Today's Alibaba, however, doesn't see a silver lining in the coronavirus outbreak.) Investors don't seem optimistic about the American sharing economy. In recent weeks, shares of Uber Technologies Inc. and Lyft Inc., the two most prominent sharing economy companies, have dropped even faster than the S&P 500 Index. There are still questions about how the spread of the disease could impact ride-hailing. Uber's airport trips, which account for about 15% of its business, will likely be hurt if tourism and business travel decline. If the worst comes to pass, the government could try to shut down ride-hailing services down to prevent the spread of the disease. Or, conceivably, if it shuts down public transit instead, demand for rides could increase. Uber and Lyft could also have to worry about whether drivers would be willing to keep working. The companies often use short-term price increases as an incentive to get people on the road when demand outpaces supply. But they've learned to be careful to suppress surge pricing mechanisms during natural disasters like hurricanes. No one wants to be seen profiteering during a amjor public health crisis. Airbnb Inc. could suffer even more than Uber and Lyft if there's a significant drop in tourism. Its public listing, expected later this year, could also be impacted. Would the company really go public during a global panic about this virus and markets plummet? I find it hard to believe, even though pressure is mounting as some employees' shares are set to expire. Meanwhile, food-delivery company DoorDash Inc. announced on Thursday that it had filed its confidential paperwork for an IPO. DoorDash's move is a bit baffling at first glance. It's not clear that a crisis would be good for U.S.-based food delivery businesses. Matt Maloney, the chief executive officer of publicly-traded delivery company Grubhub Inc., described the situation as scary, while arguing that it was hard to predict how different factors would interact to impact his business. "Do we have a problem with supply of drivers?" he said on CNBC. "Do we have a problem with supply of restaurants? Do we have a problem with demand?" Are DoorDash's executives just more bullish than Maloney? Maybe. "There is a non-zero chance they are banking on coronavirus freakout and associated demand spike for food delivery?" guessed one finance industry Twitter user. I think the more probable answer has less to do with DoorDash's predictions about the coronavirus, and more about more mundane business concerns. It's going to need money, and might have to enter whatever market it can get. —Eric Newcomer | 
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