Airbnb
Encyclopedia
Airbnb is an online service that matches people seeking vacation rental
s and other short-term accommodations with those with rooms to rent, generally private parties that are not professional hoteliers. The site was founded in August 2008 by Brian Chesky and Joe Gebbia. In July 2011, the company had over 100,000 listings in 16,000 cities and 186 countries. Listings include private rooms, entire apartments, castles, boats, manors, tree houses, tipis, igloos, private islands and other properties.
The company was incubated
by the Y Combinator
in January 2009. The initial name of the website was Airbedandbreakfast.com, but it was shortened to Airbnb.com in March 2009. At this time the site's offerings expanded from just shared spaces to apartments, whole houses and other properties. In June 2010, the founders' loft was still being used as an office. To make room for employees and to study the Airbnb product, Chesky gave up his bedroom and lived through the Airbnb service until the company moved into its first office space.
The company continued to experience rapid growth through the year and in November 2010 raised $7.2 million in Series A funding from Greylock Partners and Sequoia Capital
, and announced that out of 700,000 nights booked, 80% had occurred in the past six months. By February 24, 2011, one million had been booked through Airbnb and revenue from the month prior had increased by 65 percent increase. On May 25, 2011, actor and partner at A-Grade Investments, Ashton Kutcher
, announced a significant investment in the company and his role as a strategic brand adviser for the company. The company expanded internationally by purchasing Accoleo, a German clone of the site. In July 2011, the company raised an additional $112 million at a $1 billion valuation.
The company is well known for its freewheeling company culture, which has been praised by Business Insider
and Wall Street Journal. For instance, Airbnb employees wear hoodie
s to press conferences and business meetings. Gebbia has said that, "Airbnb is like a really fun school where you get paid."
in Squaw Valley, California. In late June 2011, an incident with a booked apartment being burglarized and heavily vandalized by the renter lead AirBnB to offering $50,000 in property insurance for landlords, a 24-hour customer-service hotline, and an in-house team devoted to investigating suspicious activity.
users. In June of 2011 a user identified as "EJ" reported that her home was robbed and vandalized. In August of 2011 Airbnb issued an "unconditional" apology for failing to treat users properly after a house was ransacked. One other incident of robbery was also widely reported. Airbnb's founder was once listed as a known spammer.
, and the The Daily Telegraph
. Airbnb has been favorably compared with Craigslist
and Groupon
, other sites that provide spur-of-the-moment rentals. Airbnb was awarded the "breakout app" at the 2011 South by Southwest
conference. Along with Quora
and Dropbox, Airbnb has been named among the next generation of multibillion dollar start-ups by the The New York Times
. Following Airbnb, other services such as Getaround, Vayable, Guidehop, and Taskrabbit launched with a similar model. New York's state legislature passed a law in July 2010 making it illegal to rent out Class A residential space for less than 30 days. However, the bill's sponsor, State Senator Liz Krueger
said Airbnb and its competitors are not the law's target.
Vacation rental
Vacation rental is the renting out of a furnished apartment or house on a temporary basis to tourists as an alternative to a hotel. The term vacation rental is mainly used in the US. In Europe the term villa rental or villa holiday is preferred for rentals of detached houses in warm climates...
s and other short-term accommodations with those with rooms to rent, generally private parties that are not professional hoteliers. The site was founded in August 2008 by Brian Chesky and Joe Gebbia. In July 2011, the company had over 100,000 listings in 16,000 cities and 186 countries. Listings include private rooms, entire apartments, castles, boats, manors, tree houses, tipis, igloos, private islands and other properties.
History
In 2008, Chesky and Gebbia moved to San Francisco. The Industrial Design Society of America was holding its yearly design conference at that time, and hotels were sold out. The two, who were unable to pay their rent, offered part of their loft as accommodations.The company was incubated
Business incubator
Business incubators are programs designed to accelerate the successful development of entrepreneurial companies through an array of business support resources and services, developed and orchestrated by incubator management and offered both in the incubator and through its network of contacts...
by the Y Combinator
Y Combinator
Y Combinator is an American seed-stage startup funding firm, started in March 2005. Y Combinator provides seed money, advice, and connections at two 3-month programs per year...
in January 2009. The initial name of the website was Airbedandbreakfast.com, but it was shortened to Airbnb.com in March 2009. At this time the site's offerings expanded from just shared spaces to apartments, whole houses and other properties. In June 2010, the founders' loft was still being used as an office. To make room for employees and to study the Airbnb product, Chesky gave up his bedroom and lived through the Airbnb service until the company moved into its first office space.
The company continued to experience rapid growth through the year and in November 2010 raised $7.2 million in Series A funding from Greylock Partners and Sequoia Capital
Sequoia Capital
Sequoia Capital is a Californian venture capital firm located on Sand Hill Road in Menlo Park, California. The Wall Street Journal has called Sequoia Capital "one of the highest-caliber venture firms", and noted that it is "one of Silicon Valley's most influential venture-capital firms"...
, and announced that out of 700,000 nights booked, 80% had occurred in the past six months. By February 24, 2011, one million had been booked through Airbnb and revenue from the month prior had increased by 65 percent increase. On May 25, 2011, actor and partner at A-Grade Investments, Ashton Kutcher
Ashton Kutcher
Christopher Ashton Kutcher , best known as Ashton Kutcher, is an American actor, producer, former fashion model and comedian, best known for his portrayal of Michael Kelso in the Fox sitcom That '70s Show...
, announced a significant investment in the company and his role as a strategic brand adviser for the company. The company expanded internationally by purchasing Accoleo, a German clone of the site. In July 2011, the company raised an additional $112 million at a $1 billion valuation.
The company is well known for its freewheeling company culture, which has been praised by Business Insider
Business Insider
Business Insider is a U.S. business/entertainment news website launched in February 2009. Founded by DoubleClick Founder and former C.E.O. Kevin P. Ryan it is the overarching brand beneath which fall the Silicon Alley Insider and Clusterstock verticals...
and Wall Street Journal. For instance, Airbnb employees wear hoodie
Hoodie
A hoodie is a sweatshirt with a hood. The characteristic design includes large frontal pockets, a hood, and a drawstring to adjust the hood opening. They are sometimes worn with sweatpants. Some hoodies have zippers on them to allow easy removal much like a jacket...
s to press conferences and business meetings. Gebbia has said that, "Airbnb is like a really fun school where you get paid."
Business model
The listings on Airbnb vary from $10 a night for a futon in Brooklyn to $5,000 a night for a 6500 square feet (603.9 m²) modern vacation manseManse
A manse is a house inhabited by, or formerly inhabited by, a minister, usually used in the context of a Presbyterian, Methodist, Baptist or United Church...
in Squaw Valley, California. In late June 2011, an incident with a booked apartment being burglarized and heavily vandalized by the renter lead AirBnB to offering $50,000 in property insurance for landlords, a 24-hour customer-service hotline, and an in-house team devoted to investigating suspicious activity.
Controversy
Airbnb has also been criticized for spamming CraigslistCraigslist
Craigslist is a centralized network of online communities featuring free online classified advertisements, with sections devoted to jobs, housing, personals, for sale, services, community, gigs, résumés, and discussion forums....
users. In June of 2011 a user identified as "EJ" reported that her home was robbed and vandalized. In August of 2011 Airbnb issued an "unconditional" apology for failing to treat users properly after a house was ransacked. One other incident of robbery was also widely reported. Airbnb's founder was once listed as a known spammer.
Reception
Airbnb has been described as a "disruptive" innovation for the Hotel Industry. It has been praised by Paul Graham (co-founder of Y-Combinator, Airbnb's incubator), The Wall Street JournalThe Wall Street Journal
The Wall Street Journal is an American English-language international daily newspaper. It is published in New York City by Dow Jones & Company, a division of News Corporation, along with the Asian and European editions of the Journal....
, and the The Daily Telegraph
The Daily Telegraph
The Daily Telegraph is a daily morning broadsheet newspaper distributed throughout the United Kingdom and internationally. The newspaper was founded by Arthur B...
. Airbnb has been favorably compared with Craigslist
Craigslist
Craigslist is a centralized network of online communities featuring free online classified advertisements, with sections devoted to jobs, housing, personals, for sale, services, community, gigs, résumés, and discussion forums....
and Groupon
Groupon
Groupon is a deal-of-the-day website that features discounted gift certificates usable at local or national companies. Groupon was launched in November 2008, the first market for Groupon was Chicago, followed soon thereafter by Boston, New York City, and Toronto...
, other sites that provide spur-of-the-moment rentals. Airbnb was awarded the "breakout app" at the 2011 South by Southwest
South by Southwest
South by Southwest is an Austin, Texas based company dedicated to planning conferences, trade shows, festivals and other events. Their current roster of annual events include: SXSW Music, SXSW Film, SXSW Interactive, SXSWedu, and SXSWeco and take place every spring in Austin, Texas, United States...
conference. Along with Quora
Quora
Quora is a question-and-answer website created, edited and organized by its community of users. The site was founded in June 2009, launched in private beta in December 2009, and made available to the public on June 21, 2010....
and Dropbox, Airbnb has been named among the next generation of multibillion dollar start-ups by the The New York Times
The New York Times
The New York Times is an American daily newspaper founded and continuously published in New York City since 1851. The New York Times has won 106 Pulitzer Prizes, the most of any news organization...
. Following Airbnb, other services such as Getaround, Vayable, Guidehop, and Taskrabbit launched with a similar model. New York's state legislature passed a law in July 2010 making it illegal to rent out Class A residential space for less than 30 days. However, the bill's sponsor, State Senator Liz Krueger
Liz Krueger
Liz Krueger is a member of the New York State Senate, representing a district on the East Side of Manhattan.She was first elected in February 2002 during a special election. Krueger is the ranking member on the Senate Finance Committee. She was Chairwoman of NY's Democratic Senate Campaign...
said Airbnb and its competitors are not the law's target.