Allie Kester
HOS-495
Dr. Altman
Airbnb Case Study
Case Summary:
• Airbnb is the largest global hospitality platform.
o In 2019, 5 million listings, in over 81,000 cities in 190 countries.
o Valued at $31 billion. (this was when it was privately held.)
▪ From spare rooms to private islands.
o More than the 3 biggest hotel chains combined.
o Went public December 10, 2020 (google)
• History: Founded by Brian Chesky (current CEO), Joe Gebbia, and Nathan Blecharczyk
in 2008.
o 2007: To raise money Chesky and Gebbia rented out beds to strangers as a
“designer’s bed and breakfast” for a conference being held in San Francisco.
This was advertised as a networking in pjs event and a more affordable
alternative at
$80 a night.
▪ This gave them the business idea of: Helping people rent out spare rooms
via the sharing economy.
o 2008: to test their idea they used the South by Southwest conference an informal
launching pad for new ventures.
, ▪ The partners recruited Nathan Blecharczyk, for designing a website that
could allow them to target more conference attendees.
• Ultimately SXSW, flopped with only six hosts and two
guests using the platform, (one of whom was Chesky).
▪ This led to the development of online payments into the booking process.
By being a double-sided platform for host and guest.
▪ To raise funding, they made politically themed cereals and raised $40,000
o 2009: The partners were accepted into a program run “by Y Combinator, a
start- up incubator that has spawned famous tech companies.”
▪ The accelerators provide a small investment fund, office space,
mentoring, and networking opportunities with venture capitalists who
want to fund the next big idea. (this allowed them to refine their product
offering.)
▪ They figured out that professional photos are the are the key to their
market. And allowed them to further refine the platform and
functions.
• Booking jumped from $200 per week over six months to 400$ per
week. And that existing guest often became future host.
o 2010: They had investors knocking down the door and they to 10% on each
transaction.
o 2017: Acquired Luxury retreats for Airbnb ($300 million)
o 2018: Turnover.
o 2020 went public.
• Business model: Digital Platforms that allows hosts to offer rooms directly to
the consumer (consumer to consumer business model) it is very asset light.
, o With no constraints such as buildings and training employees Airbnb can
expand rapidly. It owns no real estate or manages any hotels.
▪ Very easy and low cost to create new inventory. just signing up new hosts.
o They help host with marketing and professional photos and pricing for demand.
o Traditionally staying in an Airbnb meant staying in a local’s home and having
an authentic experience and affordable accommodations.
o Consumer to consumer: both can rate each other and help others gain insight on
host and guest.
• HOSTS:
o 1million dollar guarantee for any damages.
o Super host for those who have a consistent 5 star ranking (only 7%)
o Guest become the host and Airbnb expands.
o Decide what cancellation plans, fees, amenities, check in/out requirements.
• Guest:
o Airbnb screen guests before they register on the platform. Following the booking
request, the host can look at reviews or ratings and either accept or reject the
guest.
▪ Another option is Instabook where this screen process is forfeit to host.
o Rewards system: 2018 super guest loyalty program. (free nights frequent stays)
• Features and offerings:
o Payment plans: Split payments in 2017 for group trips allows guest to
pay separate and allows up to 72 hours for all guest to pay!
HOS-495
Dr. Altman
Airbnb Case Study
Case Summary:
• Airbnb is the largest global hospitality platform.
o In 2019, 5 million listings, in over 81,000 cities in 190 countries.
o Valued at $31 billion. (this was when it was privately held.)
▪ From spare rooms to private islands.
o More than the 3 biggest hotel chains combined.
o Went public December 10, 2020 (google)
• History: Founded by Brian Chesky (current CEO), Joe Gebbia, and Nathan Blecharczyk
in 2008.
o 2007: To raise money Chesky and Gebbia rented out beds to strangers as a
“designer’s bed and breakfast” for a conference being held in San Francisco.
This was advertised as a networking in pjs event and a more affordable
alternative at
$80 a night.
▪ This gave them the business idea of: Helping people rent out spare rooms
via the sharing economy.
o 2008: to test their idea they used the South by Southwest conference an informal
launching pad for new ventures.
, ▪ The partners recruited Nathan Blecharczyk, for designing a website that
could allow them to target more conference attendees.
• Ultimately SXSW, flopped with only six hosts and two
guests using the platform, (one of whom was Chesky).
▪ This led to the development of online payments into the booking process.
By being a double-sided platform for host and guest.
▪ To raise funding, they made politically themed cereals and raised $40,000
o 2009: The partners were accepted into a program run “by Y Combinator, a
start- up incubator that has spawned famous tech companies.”
▪ The accelerators provide a small investment fund, office space,
mentoring, and networking opportunities with venture capitalists who
want to fund the next big idea. (this allowed them to refine their product
offering.)
▪ They figured out that professional photos are the are the key to their
market. And allowed them to further refine the platform and
functions.
• Booking jumped from $200 per week over six months to 400$ per
week. And that existing guest often became future host.
o 2010: They had investors knocking down the door and they to 10% on each
transaction.
o 2017: Acquired Luxury retreats for Airbnb ($300 million)
o 2018: Turnover.
o 2020 went public.
• Business model: Digital Platforms that allows hosts to offer rooms directly to
the consumer (consumer to consumer business model) it is very asset light.
, o With no constraints such as buildings and training employees Airbnb can
expand rapidly. It owns no real estate or manages any hotels.
▪ Very easy and low cost to create new inventory. just signing up new hosts.
o They help host with marketing and professional photos and pricing for demand.
o Traditionally staying in an Airbnb meant staying in a local’s home and having
an authentic experience and affordable accommodations.
o Consumer to consumer: both can rate each other and help others gain insight on
host and guest.
• HOSTS:
o 1million dollar guarantee for any damages.
o Super host for those who have a consistent 5 star ranking (only 7%)
o Guest become the host and Airbnb expands.
o Decide what cancellation plans, fees, amenities, check in/out requirements.
• Guest:
o Airbnb screen guests before they register on the platform. Following the booking
request, the host can look at reviews or ratings and either accept or reject the
guest.
▪ Another option is Instabook where this screen process is forfeit to host.
o Rewards system: 2018 super guest loyalty program. (free nights frequent stays)
• Features and offerings:
o Payment plans: Split payments in 2017 for group trips allows guest to
pay separate and allows up to 72 hours for all guest to pay!
