Can Dashing Help Foster Entrepreneurship?

As independent contractors, app-based workers like Dashers are their own boss, and many of them — about 6% in our latest survey — have another business as well. In fact, there is a growing body of evidence that work like dashing can help get new businesses off the ground. That’s why one in six self-employed Dashers (17%) say they dash to save money to start another business and 20% say that they plan to dash until their side business or business idea becomes successful.

Dashing can help entrepreneurs in a number of ways. Starting a new business can be risky, and dashing can provide a financial cushion while waiting for a new business to take off. In particular, 61% of self-employed Dashers agreed that dashing gives them the freedom to leave a job they didn’t like, and 60% say that they choose DoorDash over other earnings opportunities because dashing allows them to supplement their income whenever they need to. For example, Dashing can provide a cushion for businesses that don’t operate year-round:

“I own a seasonal pest control business, meaning I am working non-stop April – October. But in the off months, I’ve still got to pay the business insurance and other monthly expenses. Dashing with DoorDash provides the freedom I need to make a little money when I want to. Not when I’m told to.” — Shanyn, North Carolina

Recent research bears this out, finding that people who leverage platform work are more likely to start additional businesses. Using individual-level tax data linked to 174 platforms across a wide range of sectors (services, transportation, leasing, and selling), professors Margarita Tsoutsoura, Spyridon Lagaras, and Matthews Denes find that:

• People who engage in platform work start new businesses at more than double the rate of people who don’t. 

• Businesses started by people who do platform work tend to be larger  — they are 5.6% to 12.5% more likely to have any employees, and 7.1% to 15.8% more likely to have at least 5 employees.

• These businesses are also more profitable — firms started by people who do platform work have 37% to 45.4% higher profits than firms started by people who don’t.

These findings are also consistent with previous research showing that the expansion of rideshare is associated with a 5% increase in new business registrations and a 7% increase in internet searches about entrepreneurship when Uber or Lyft entered a market. Similarly, research on the sharing economy also found evidence that Airbnb spurs new business creation.

No matter how people choose to supplement their earnings, the research is clear: platforms like DoorDash provide a way to help entrepreneurs who are starting a business, weather tough economic times, and have a second source of income during seasonal dips in business.