Geoff Drabble, Chief Executive of £12bn tool rental giant Ashtead Group, lifts the lid on the sharing economy.

Why buy, when you can rent?

That’s our motto and the guiding principal of everything we do at Ashtead. Today we call it the sharing economy, but the idea has been with us for a very long time. It’s easy to see the appeal – renting offers access to the best quality, most up-to-date products, conveniently and cheaply, with no need for maintenance.

What has changed is the ease at which people can hire goods. Just a decade ago, leasing a mini-digger or outdoor flooring for an event meant a number of ‘phone calls and waiting a week for delivery. Now Ashtead customers can rent equipment in four clicks from their smartphones, and have it where they need it the next day.

Companies such as Uber and AirBnB don’t even own the products they sell. We hear a lot about these digital disruptors creating headaches for traditional taxi companies and hotel chains, but the term suggests they’re some kind of trouble makers. In reality, all these companies have done is gain a market advantage by making things as easy as possible for their customers.

The reason for their success is scale. Smartphones bring the buying power of the internet to the hands of more than 2 billion consumers globally. So you only have to reach 0.1% of them to have a business worth millions.

There are now companies offering everything from bicycles to music and office spaces on demand.  Need an outfit to stand out at an interview? Why buy it when you can rent it for a fraction of the price?

Investors are so aware of the massive opportunities for innovative startups like these, they don’t even need to see profits to back the next big thing. Uber has been valued at more than $70 billion, but it hasn’t broken even yet.

When I started my career, turning a profit in business was very different. You had to design physical products, decide how they should be built and where they got manufactured. You needed an army of salespeople, and a multimillion advertising budget to make any money.

Building a successful company today is no less challenging, but the opportunity to do something really innovative is so much greater.

Speaking to students from the Business School’s Global Challenges for Business course recently, my advice was simple – take every opportunity you can to try something different in your career. Make sure you find something you care about – success only happens when you’re invested in something you’re really interested in.

Geoff Drabble is Chief Executive of international equipment rental company, Ashtead Group.

He delivered the 2018 Jubilee Lecture as part of the Global Challenges for Business course, for University of Edinburgh Business School first year undergraduates.