In the venture capital world, "on-demand" means what it means when your cable company offers you video-on-demand. You look at a list of movies or tv shows and can start to watch them at any time - no more being a slave to the schedule. This sounds similar to what you get with Tivo (and all video recorders), which provides the same opportunity for shows/movies you have recorded from the scheduled offerings. However, even more than Tivo, video-on-demand provides access to programs that you didn't know you wanted to watch at the time they were scheduled (or programs from the back-catalog, never usually broadcast at all).
This is not a new phenomenon ... hotel rooms are an example of accomodation "on-demand", and restaurants are about food "on-demand" (and here's a thought for the oldest profession, providing on-demand services for millenia).
However, many important facets of our life have not been available on-demand, and venture capitalists are piling in to invest in them. One example is ZipCar, where for a monthly membership fee you can have access to a car by the hour or by the day. These ZipCars "live" in parking spots around the community, certainly not too far away from home if you live in a city, and through clever technology you bypass all the rental car hassle to use a car just the times you need one.
In the software world, the new on-demand paradigm arrived with a company called "SalesForce.com" (whose motto is "Success on demand"). This company pioneered the notion of a specific kind of software, used by companies, can be made available on-demand without any of the hassle of buying and installing a big enterprise software application. SalesForce.com allows any company (or sole proprietor) to log on to the internet, create an account and start keeping track of all their sales activity in a rich, sophisticated database. Since, in the "old days" buying such software was a 12-18 month affair for a large company, the notion of being up and running in hours or days with an integrated setup is amazing. Now many other companies are offering software on-demand (including a few of in the Sigma portfolio), from managing websites to shared "virtual" workspaces where you can securely share and collaborate on documents with colleagues from around the world.
One turn of this wheel has been Amazon's amazing (the pun, at last) offer of computing power and storage "on demand". If I want to run software that needs lots of powerful computers and large amounts of computer disk storage, I no longer have to buy them, or even rent them by the month. I can now use Amazon's compute and storage facilities "on demand", send software and data back and forth on the internet, and pay just for what I use.
Since this is a VC:VC post, comparing my venture capital life with my venture cycling life, what on earth can be on-demand about the latter.
I understand that in The Netherlands, at one stage (if not currently) there was a ZipCar like service for bikes on-demand. How about: I can get on my bike and go anywhere I want on-demand... if only that were true (especially after this week's ice storm), and of course it is just as true about a car trip.
However, I was prompted to write this after reading this great posting at Jcarrot.org about the author's fresh-local-organic-food-on-demand lifestyle. We all think the produce section is (fresh)-(local)-(organic)-food-on-demand, but Naf Hanau's article shows the way it's really done. I won't steal his thunder - just go and read the article - and his choices and opportunities are less than practical for most of us, but it doesn't hurt to be reminded of the possibilities.