Drive By

Companies like Uber and Airbnb don’t just identify an industry in need of disrupting; they identify regulatory blind spots that allow them to operate with little government oversight. For all intents and purposes, Uber is a taxi company and Airbnb is a hotel company. But both maintain they’re just services connecting users with independent contractors (in these cases, drivers and homeowners). This shell game lets the companies avoid costly licensing, training requirements, and sometimes even taxes. By the time local governments move to regulate after a year or three of operation, there are already teams of lawyers and a customer base used to low prices ready to fight. The message is clear: face a lengthy legal and public relations battle or give up and let companies operate outside the rules.