Tribal money – The collaborative consumer’s new money

A new initiative debuted this week in an attempt to change the way we think about money.

The brainchild of Konstantin Vitalskij and Alex Sawtschuk, two students from the Maastricht University School of Business and Economics, is one of several startups participating in the Local Heroes business plan competition organised by the University Fund Limburg and the Maastricht Centre for Entrepreneurship.

Developed partly as a PREMIUM project, their service promises to position itself in the sharing economy where money resides in our market economy: at the centre of the economic vortex.

The idea is simple yet powerful. You sign up on a website and start offering your goods or services in an online market. But instead of receiving euros in exchange for your bike or gardening work, you earn Pendos. With these freshly acquired Pendos in your account you can now search the market for something you want from someone else.

Because of their design, Pendos are secure, robust against inflation, available in abundance and so easy to use that you’d rather use them than money. The way Pendos are created, issued and circulate, is as old as mankind and resembles tribal or gift cultures’ exchange mechanism formally known as complementary currencies.

While complementary currency systems usually operate on a small scale in local communities, the students aim their service at another target: The Collaborative Consumers.

To get a clearer idea about Collaborative Consumption they talked with Prof. Dr. Gaby Odekerken, Extraordinary Professor of Customer-Centric Service Science at Maastricht University, about this novel business model.

What is the current state of collaborative consumption in the world, and in the Netherlands?

GO: Collaborative consumption is booming. There are many different initiatives in almost all product categories and services. There are also many types of initiatives. The Dutch Randstad region has taken on a leading role in these initiatives, perhaps because it has the critical mass to easier establish a network to trade products. Pendo as a service could be a solution for less populated areas, but it will take time as the initiative is still quite unknown.

What kind of people use collaborative consumption?

GO: There are three reasons why people would engage in collaborative consumption: financial, social and/or environmental. An example would be Snapcar, where people rent their car when they do not need it. This engages environmental and value conscious people. Websites as may encourage social sporting activities.

What are the chances for success of such an initiative in Maastricht?

GO: People in Maastricht tend to be more traditional and more conservative, so the adoption rate may be longer. However, the collaborative consumption may exist more strongly in Limburg in an informal way. E.g.: Neighbours who help each other out or friends who do work for one another without money being involved.

The student population however may be part of early adopters and could therefore be a good target group. The technological and trust aspects will not be a problem for most people in The Netherlands. Only the oldest generation (70+) may have issues with this sort of networks, which depend on sharing products or trusting other people through the internet.

How does collaborative consumption relate to market economy?

GO: Collaborative consumption relates to the market economy in the same way the old consumer relates to the new prosumer. And at the dawn of the 19th century the consumer model was in the minority. In the 21st century the tide turned thanks to technology. But the effects of the shift in attitudes and preferences is visible in Snapcar: there will always be rental companies next to collaborative consumption initiatives. People either have a preference for a more formal network structure or have a lack of confidence in other people.

How do you see the evolution of collaborative consumption in the near future?

GO: The financial crisis is a major driver to set up initiatives such as Pendo. Technological enablers that were developed in recent years also play a big role. Collaborative consumption is a counter movement with respect to the consumerism that characterised the last century. People go more back to basics instead of needing to own everything that they might need. And there is a strong connection between the Pendo user and the Collaborative consumer. New business models may arise from these movements.

Can Pendo be an actor in the market economy and in the social economy?

GO: The initiatives in Maastricht or elsewhere in the country currently work with a social component. An example would be the ‘clothes library’ where people can borrow clothes and return them after use. People wash the clothes before they bring them back. Apparently, the social component works very strongly. A complementary currency may become an additional advantage to link multiple initiatives. On the other hand it may damage the charm of the social aspects of these type of initiatives.

What are your expectations for Pendo?

GO: There is a possibility for this initiative as there is room for more types of collaborative consumption than just bartering. This would be the right timing to start it in The Netherlands. It is important to reach the critical mass and there might be a fine balance between keeping the social driver and using a complementary currency.

What are the specificities of the Maastricht context Pendo needs to take into account?

GO: In Maastricht it could work out. There is already a lot of informal collaborative consumption. The question is if people will find Pendo informal enough to use. On the other hand, people know each other better in the region and the trust may be more easily gained. The student population are as said potential early adopters.

What do you recommend for Pendo to succeed?

GO: Pendo might focus on products that are not needed as often or need a lot of storage capacity, so that there is an incentive to collaborate with these products. Pendo can also focus on services. Pendo might work even better by exchanging services in the domain of healthcare. For example, by earning Pendos in Limburg for volunteering in an elderly home you could pay someone in Randstad for taking care of your grandparents who are in another elderly home. An example of such a point system is In setting up such a network, a lot of effort is required and people may need a lot of help and encouragement. Usually people would just join a network that already exists because that is easier.


By Konstantin Vitalskij and Alex Sawtschuk

The platform Pendo – Social Marketplaces Made Simple is online here.

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