Something Borrowed

This letter is part of the Carousel of Plenty, a series exploring products and services that could only exist in the Circular Century. We talk a lot about circular transformation — why it matters, how it works, what it demands of leaders. This season, we show you where it leads. Each essay presents one solution: something you'd use, live with, or depend on in a world designed for permanence rather than disposal. The premise is simple. The linear economy promised progress and delivered volume — more things, fewer of them worth having. The Circular Century delivers plenty: the precise amount that satisfies without burdening. These are its furnishings.

Nothing in the Garage. Everything Within Reach.

You know, folks used to measure a man by what was in his garage. The drills he owned. The lawnmower he kept tuned. The good ladder. The pressure washer he'd splurged on. Twenty years of equipment piled up against the day he might need it.

Well, friends, our garage doesn't have any of that. And let me tell you why.

Down at the corner there's a building — well-lit, glass front, friendly folks hanging around. That's where we keep the drill. A good one. The kind that would set you back two hundred dollars new and would sit in your garage the other 359 days of the year. Nobody on our block owns one. We share the one at the corner.

Last Saturday Mother needed a picture hung in the front hall. I walked down, signed the drill out — twenty seconds, no fuss — and walked home. Forty minutes later the picture was up and the drill was back at the corner. By dinner three other people will have used it. By the weekend, more work than any garage-bound drill ever managed. The kind of work the engineers who designed it had in mind.

But friends, that's not the part I wanted to tell you about. Walk past the tool room at the corner and you find another door. Open it up and inside is a model railroad layout — a real beauty. There are hills. Valleys. A little wooden bridge. Two retired engineers in the neighborhood keep it humming. The carpenter from down the street built the mountains. The former president of the town council runs the longest meeting of his life now, every Wednesday night, working out the timetables.

And the kids on the block? They wander in. Nobody invited them. The door is just there, and one of them stuck his head in one Saturday, and the retired professor said want to see how this works? and the boy said yes. Now my granddaughter can solder. The professor's still teaching.

None of those men could have built that layout alone. None of them would have. The boys would never have learned to solder from a structural engineer if the door hadn't been right there, in the same building where their parents go to borrow a drill.

Something borrowed. Built together. Better than owning.

This is life in the Circular Century, friends. The right tool. The right room. The right neighbors. And nothing in the garage you don't need.

For the consumer

Do you own a drill? Almost certainly. If you don't, maybe you have been thinking about buying one. Maybe you feel the small shame of not having one.

A drill in your garage represents something the conventional wisdom treats as a single thing — ownership — with four distinct payoffs we have learned not to separate.

The first is identity. A Leatherman multitool in your pocket signals competence. The fly rod in the garage deems you a fly-fisher even on the days you don't fish. The well-stocked workshop says something about its keeper.

The second is sovereignty. The drill is yours at 3 a.m. when you need it. No permission slip, no queue, no rental counter, no apology to anyone.

The third is persistence. The drill evokes memories. Maybe some of the tools belonged to your grandfather. Ownership provides an uninterrupted temporal layer.

The fourth is mastery. The drill rewards familiarity. Good tools are tuned and broken in. Ownership is the precondition for the kind of mastery that requires a particular object across a particular span of years.

These payoffs are real. Any honest account of the qualities of ownership has to honor them.

But there are burdens that come with ownership. Equally real but less articulated, they are the part the linear economy has trained us to accept.

• Storage as tax. Every owned thing claims square footage. The garage is not free. The unused half of every closet is not free. The storage locker is certainly not free.
• Maintenance as obligation. Every owned thing is a small dependent. Batteries to charge. Edges to sharpen. Calibrations to check. The thing waits for your attention, and over a lifetime the cumulative attention for our stuff adds up to thousands of hours.
• Idle capital. The cordless drill in the suburban garage runs at a lifetime utilization rate of less than 1%. By the time it is replaced, it has performed perhaps a dozen of the ten thousand hours its chassis was engineered for. The depreciation continues at full speed during the 99% idle.
• Fixed configuration. The drill you own is whatever drill you bought. The job that needs a hammer drill, or an impact driver, or a right-angle drill, finds you with the wrong tool.

This is the dynamic Walter Stahel observed in the 1980s and named the Performance Economy. Rolls-Royce, gifted at making durable and efficient engines, found the best way to help its customers was to charge them for thrust by the hour. Xerox started selling pages instead of photocopiers. In each case the producer's incentive flipped: the longer the asset lived, the better it performed, the more revenue it generated. The customer hired the outcome; the supplier delivered the capability. The math worked for goods with high capital intensity — millions per engine — because the spread between owned-but-idle and hired-and-active was too big to miss. It was simply better business for both sides.

That same dynamic applies to the drill, the ladder, the sewing machine, and the pressure washer. The per-asset spread is smaller, but the aggregate spread — across a neighborhood's worth of underutilized tools — is large enough to sustain a real institution. The Library of Things, already operating in hundreds of cities, is what that institution looks like at one end of the capability spectrum. Zipcar is the same pattern applied to vehicles, mature enough now to count as an antecedent rather than a novelty.

The historical frictions of borrowing have structural answers when the institution is designed well. The trust failure of the neighbor who didn't return becomes irrelevant when the institution holds the asset. The friction tax of the rental counter reduces to a twenty-second reservation and a thirty-second return. The status inversion — borrowing as a sign of poverty — flips when the library-of-things in the wealthiest neighborhoods reads as sophistication. We don't keep inventory we don't need.

The new payoffs of institutional borrowing are three.

• Lightness. The household carries less. The mental load of inventory shrinks. Anxiety lifts.
• Expertise on tap. The institution has the right tool for the job, not the all-purpose compromise.
• Configurability. Today the hammer drill. Tomorrow the impact driver. The right tool for this job, not the average tool for any job.

But the deepest argument for borrowed capability is not the math.

The math is the what. There is a what for.

For that, we have to step past both owning and institutional borrowing, into something less conventional. The drill in your garage is the own mode. The Library of Things is the borrow mode. There is a third — pool — that a previous letter, The Neighbors, established as the operating layer of plenty.

Pooling is not borrowing. Pooling is joint construction of shared abundance no individual could afford alone.

Peter Strack documents this mode in the Swiss 2,000-watt neighborhood pilots — communities engineered to bring per-capita energy use to roughly one-fifth of typical American levels. The central mechanism is not technological. It is institutional. The model train room in the building's common space was not an asset the institution loaned out; it was an asset the residents built together, because none of them could have justified the layout at home, and the hobby had no future in their families. The asset did not previously exist. They made it, as a team.

The 2,000-watt neighborhood is the rigorous engineered version of patterns the developed world has been operating for a century or more. German Schrebergärten and British garden allotments have been pooling cultivated space since the late 1800s. American food co-ops and credit unions have been pooling groceries and capital for much of the same period. Danish bofællesskaber and the cohousing movement that descends from them have been pooling residential life for more than fifty years. None of these are utopian projections. All have track records, in some cases longer than the lifespans of the institutions that today dominate their respective industries.

The mechanism, as we described in The Neighbors, is not ideology, but proximity and shared interest — enabled by design.

What the pool mode produces: belonging. The fourth payoff.

The neighborhood that pools its capability is also a neighborhood that knows its members. The cross-generational interaction is not designed, but the affordance for it is. It happens because the door was right there, in the building where the boy walked past on his way home from school, and the retired professor said want to see how this works? and the boy said yes. The loneliness that the linear economy leaves to fester in private naturally recedes in public, in the company of people who are making something together.

Clayton Christensen taught us that consumers hire products to do jobs — and that the jobs are rooted in feeling more than in optimization. The morning-commute milkshake is hired to make the commute bearable, not because the milkshake is nutritionally optimal. The same logic applies to capability.

The customer hires the drill to put a shelf on the wall. The Library of Things delivers that hire efficiently.

The community hires the common room where the model train is as a place where the retired engineer's hands stay useful and the boy's hands learn to make something his father couldn't have taught him.

That's still a job-to-be-done hire. The institutional form is the difference.

For the producer

If you operate in the household-capability space — if you sell tools, equipment, sporting goods, or any of the categories of object that live in the suburban garage — the analysis above describes the structural opportunity in front of you. The category is ready to disrupt. What follows is the strategic frame.

Borrowing and the conservation of attractive profits

In The Innovator's Solution, Clayton Christensen articulated what he called the Law of Conservation of Attractive Profits: when modularity and commoditization cause attractive profits to disappear at one stage in a value chain, the opportunity to earn attractive profits with proprietary integration almost always emerges at an adjacent stage. Ben Thompson, at Stratechery, has observed the law operating across the central platform disruptions of the last two decades.

• AirBnB commoditized property and integrated trust. Hotels had kept trust as their proprietary integration, and rooms as the modular commodity; AirBnB inverted both, moved trust to the platform layer, and assumed the hotel's relationship with the customer.
• Uber commoditized cars and integrated dispatch. Taxi companies had kept dispatch as their proprietary integration, with the medallion system protecting the integration's exclusivity; Uber moved dispatch to the platform layer, commoditized the vehicle, and assumed and elevated the customer relationship.
• Netflix commoditized content production and integrated subscription-and-recommendation. The studios had kept production as the proprietary integration and distribution as the modular layer; Netflix flipped both, and the customer relationship moved.

The Borrowed Capability producer makes the same move. The incumbents in the household-capability space — the big-box retailers, the tool manufacturers, the suburban garage as institution — have kept the customer relationship modular. The transaction is brief: come in, buy the thing, leave. The customer's actual need — the hole in the wall, the workshop full of capability, the place to learn to make things, the friends to make alongside — is left unowned, distributed across YouTube comments and informal maker spaces and the inherited handiness of one's father.

The Borrowed Capability producer commoditizes individual tool ownership (the asset becomes modular, sourced from multiple manufacturers, present at the institution rather than in any garage) and integrates capability itself — outcome-delivery, expertise-on-tap, continuity of relationship across years, and (in the pooling mode) the community of practice.

The single-word label for the integration vector, in the Thompson pattern, is capability: not the tool, the outcome the tool serves, with the journey from need to mastery wrapped around it.

The Library of Things is a specialized CRM company for the household-capability customer. So is the cooperative-pooling-infrastructure provider. The architecture is the most familiar pattern of the last twenty years of business strategy, and it has not yet been deployed at scale in this category. The leap of faith the producer-side reader has to make is not whether the model works — it works the way every other platform disruption has worked. The leap is whether you will build it before the incumbent retailers do.

Two archetypes, one covenant

The capability-as-utility provider operates the Library of Things model. The job is to aggregate underutilized capability at neighborhood scale, supply it on low-friction terms, and integrate the customer-adjacent layer: expertise, continuity, recommendation, scheduling, mastery development. The capital structure is a multi-decade asset base requiring institutional maintenance discipline, member-experience design, and inventory rotation. Stahel's performance-economy logic scales down with the right institutional architecture.

The pooling-infrastructure provider operates cohousing developments, community land trusts, neighborhood-as-service operators, and cooperative housing-and-capability models. The job is to design the physical and social infrastructure that enables proximity and shared interest. The capital structure is more patient still; the social infrastructure matures over decades, and the return is a function of the institution's longevity. Strack's Swiss pilots are the empirical evidence at small scale; the older cohousing and allotment movements are evidence at larger scale; the form is unfamiliar to most American producers because American zoning and capital structure have not historically rewarded it.

The two archetypes are complementary, not competitive. The same neighborhood that hosts a Library of Things benefits from cooperative pooling structures around the assets that reward joint construction. The producer that masters one is well-positioned to develop the other.

The cultural argument runs across both. Douglas Holt described iconic brands as those that articulate a narrative of rebellion against the central catechism of their moment. The household that opts out of accumulation, that borrows from institutions and pools with neighbors, is already a rebel against the linear economy's central catechism. The producer that gives the rebellion vocabulary, posture, and dignity does iconic-brand work in Holt's strict sense. This is marketing with purpose. It is the cultural work the moment is hiring producers to do. Winston Churchill treated as given the broad sunlit uplands in store for a population that had not yet experienced peace; McCann Erickson, in 1971, put eighteen young adults on a hillside and gave them a song about what the world needs today. The function was good business. The brand that articulates the unfamiliar arrival-state earliest and most clearly becomes the cultural infrastructure through which the arrival is recognized when it comes.

The covenant the producer enters: capability must be reliably available, well-maintained, low-friction to access, high-status to use, and — for the pooling mode — designed to invite participation rather than substitute for it. The Library of Things that runs out of drills on a Saturday morning loses the rebellion. The cohousing development whose common rooms sit empty because no one bothered to design for the friendships loses the deeper rebellion. The capital structure must align to multi-decade institutional outcomes, not short-cycle returns. Short-cycle capital cannot fund this work. The asset base is built over years and maintained forever. The social infrastructure matures over generations.

The producer plays a multi-decade game. The patient brand wins.

Image prompt: Still life of a coral red cordless drill standing upright on its
flat base on a wide citrine yellow countertop in the Library of
Things, three-quarter view slightly above eye level, the citrine
counter surface a matte high-quality material that reads like
classic formica at first glance but reveals modern stone-like
depth on closer inspection, golden hour sunlight angling in from
the upper left through an unseen glass storefront, long warm peach
shadows stretching across the citrine surface, the drill rendered
in stylized graphic flat planes occupying roughly a quarter of
the frame as the clear focal point, a soft hint of pegboard with
neatly hung tools blurred in the muted background wall, a small
Pearl Gray paper return tag resting beside the drill, a small
teal accent container at the edge of frame, the citrine counter
dominating the composition as a warm color field, no human figures,
mid-century advertising illustration style, 1960s World's Fair
poster aesthetic, bold confident graphic design, flat color areas
with clean edges, warm optimistic palette featuring citrine yellow
(#FEC400) and teal (#00B7B0) and coral red (#F14432) accents,
Madison Avenue print advertisement quality, retro-futuristic
consumer optimism, clean sans-serif typography feel, slightly
stylized figures without detailed faces, cheerful domestic scene,
gouache and screenprint texture

The rest of this letter is for Dynamo members — the people building plenty with us. If you're reading as a guest, you're welcome here. But the best seats on the Carousel are reserved. Join the Dynamos.