All the major home exchange websites charge a pretty hefty yearly membership fee which ranges from €100 Euro a year to a one time fee of US$2500 (!).
Urban Crabs is a social business. As a member we ask you to pay what you think our service is worth, and only pay what you can afford. Why do we choose the “pay what you can” model?
We want to make working abroad accessible to more people
At The Society of Home Office Swappers we don’t just want members from the “usual suspect” global nomad hotspot cities like Amsterdam, Berlin and Lisbon. From working at Spotted by Locals we have learned that the secret sauce of an awesome community (and a better world) is connecting community members to people who are not like them. But, in many of the countries we’re aiming to expand to many people cannot afford to travel (let alone work) abroad.
By asking members to pay what they can afford, we can make it possible for a much more varied group of people with interesting backgrounds to become an active member of our society. Win-win for everyone!
Members who earn more can pay more
We think it just isn’t fair that a member who lives in Kosovo pays the same as a member who lives in Switzerland, where the average income per capita is 17 times higher.
Most Urban Crabs are self-employed and don’t earn a regular salary. We understand that you’re occasionally strapped for cash when waiting for an invoice to be paid by a client for example. We trust you will pay some more next time…
Paying for a service upfront isn’t (as) fair
If you pay a membership fee you’re often paying for something in advance that you haven’t even tried out. In the most extreme case (we won’t name the competitor) you pay $2500 upfront. We think it’s just much more fair to pay after you experienced our service.
We believe in the business model
As entrepreneurs, we’ve always been fascinated by the “pay what you want” or “pay what you can” business model. On our travels for Spotted by Locals we have visited quite a few nice cafés and theaters that have tried this model. Like the Battersea Arts Centre in London.
Not only because it’s a more fair and inclusive model, but also because we believe it will work commercially! If we emit trust to the people who use our service, we think that in return we will receive a higher level of trust and satisfaction. Perhaps it would be even more profitable than if we were to charge a membership fee, which would be great as we think it would allow us to grow our community much faster!
As a social business without investors breathing down our neck to get a return on their investment as soon as possible, we have the freedom and the time to try out this business model. We’re just so curious how it’s going to work out. So few businesses have tried it and very little good research seems to have been done on the profitability of the “pay what you can” business model. One of the few research papers we found has a promising conclusion:
[..] not only can pay-what-you-want pricing generate positive profits, but it can also be more profitable than charging a fixed price to all consumers.
Chao, Fernandez & Nahata
On this blog (and in our newsletter) we’ll keep you up-to-date on how the “Pay what you can” business model is working out for us and what we’re learning. In the meantime, let’s show the world that this business model works 🙂.