Ranging from staycation homes to cottages tucked in the mountains, the demand for Airbnb’s is ever increasing. It is deemed as one such platform that serves as an online marketplace to help people find accommodation during their trip as per their needs. Airbnb is serving over 220 countries and regions across the world today. Hence Airbnb’s are now known as a “community built for belonging” but it had once started as a humble beginning like any other.
Airbnb, Inc was founded by three roommates,in 2008 by Brian Chesky, Nathan Blecharczyk, and Joe Gebbia. Airbnb is actually a shortened version of its original name, AirBedandBreakfast.com. To fund their startup, they began selling election-themed cereals. The Airbnb founders managed to make a whopping $30,000 selling the Obama O’s and Cap’n McCains. They also came up with innovative and catchy jingles to attract attention.
Airbnb raised its first funding of $20,000 They were still making a mere lumpsum $200 a week and thus decided to make good use of the available money to travel to New York, their biggest market, to meet their users. On reaching there, the focus had now changed from shared spaces to all sorts of accommodation. And to their surprise in March 2009 , Airbnb had over 20,000 listings and close to 10,000 registered users.
Airbnb generally falls under the lodging sector of the hospitality industry. This industry is expected to reach a Compound Annual Growth Rate of 8% to reach $5891 billion by 2023’s end. It is an online platform which connects people in search of accommodation with the hosts who are interested in renting out their place. They help the host to find guests by allowing them to display their place on Airbnb’s platform completely free of cost. Airbnb’s revenue comes from the two-way commission charged from both the host and the guest. They charge 3% from the hosts and typically around 14% from the guests for every transaction made.
From starting in a small room in San Francisco, today Airbnb has their listings in over 1,00,000 cities around the world. It is one of those companies, which grew from nothing to a $30 bn firm in just 11 years.
The funding started to flow in gradually from $20,000 in the form of the Pre-Seed round to the highest amount of $1.5 Billion in Series G. The COVID-19 pandemic came as a terrible disaster to their business operation. However, when the company went public in December 2020, Airbnb made a remarkable achievement by entering a $100 Billion market valuation right on the first day of their IPO. The Airbnb share value surged to a record high of 113% from $68 per share to $144 per share. This was one of the highest first-day rallies in US history.
Airbnb is now said to be concentrating beyond traditional connotations of work travel and leisure for its success in the future. It is further aiming to convert Travel into a Living. To achieve this, Airbnb introduced more than 100 upgrades and innovations to its existing services that ensure flexibility among hosts and guests. They have also been steadily working upon a new concept and experience that they would offer their guests in the post pandemic situation.