Share a Stranger’s Bed…For a Price

Airbnb is a website that connects homeowners who are willing to rent out parts of their homes or apartments to guests for a relatively low price. It is often a great deal compared to the hotel prices in the area. I first learned about this while traveling abroad.  At first I was not into the thought of staying in a stranger’s apartment for a weekend and I wondered who would think of this idea but I ended up having a great experience. Brian Chesky is the 30-year-old creator of this site that first came up with the idea for the company five years ago. While many people have not heard of it, 300,000 people rent out their homes and 4 million people have used this during their travels.

This idea is the idea of a “shared economy,” which is becoming more of a common concept in new technology and business strategy. Other businesses springing up in this sector include: ride-sharing, pet-sharing, and office-sharing. What is so enticing about this type of business and economy is the value that comes from both ends. It is a property that is already owned and maintained so the operating cost is low and thus the price is low. Airbnb simply connects the people that can benefit from this type of venture. What inspired Chesky was when he realized he was $150 dollars short of his rent for the month. This was the obvious solution to meet the difference.

Interestingly Chesky explained, “The stuff that matters in life is no longer stuff. It’s the people. It’s relationships. It’s experience.” Chesky is encouraging what many other businesses are removing from their companies: human contact and experience. It is a personal experience to stay in someone’s house and often more appealing to customers for reasons besides the price. This has paid off for the company, which is estimated to be worth anywhere from 1.5 to 2.5 billion by Forbes. This concept inspired their slogan, “Travel Like a Human” and has been growing rapidly since its creation.

 

Another company who has made a profit off of this “sharing with the Joneses” concept is spotify. Users can create their own playlists and share music and playlists with other users of the site. This type of business uses technology and seems to connect people and is something that is more personal. And for those of you worried about what types of people may come into your house, Airbnb has a $1,000,000 insurance on your property. This has been utilized in some cases such as the case where a rental in Sweden was temporarily used as a brothel.

http://www.nbcnews.com/travel/airbnb-rental-sweden-allegedly-used-temporary-brothel-944402\

All in all this is an upcoming business model that profits off of something that is already owned and can be shared with others. It is reducing the cost on both ends of the deal and connecting people who want to share in this type of endeavor.

For more information:

http://todaynews.today.com/_news/2013/03/29/17509341-airbnb-founder-wants-you-to-open-your-doors-to-strangers-and-let-them-sleep-over?lite

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6 thoughts on “Share a Stranger’s Bed…For a Price

  1. This seems to be a better alternative option for a lot of us cash strapped college kids and many people that could not afford to pay for hotels a chance to see the world. Yet this may prove to render the hotel industry obsolete. It will be interesting to see if Airbnb’s continue growth will have any effects on the hotel industry at large. It is known that many hotels charge ridiculous high fees, companies such as Airbnb may force alot of hotel to think about how to change and compete with a new found industry. Airbnb’s theory of human contact and experience seems viable in places like America and Western Europe. However, in Asia and Islamic countries, home is a place for the family and friends. Would they run in to troubles when they try to expand?

  2. This is a really cool company that, prior to your post, I had no idea existed. I went to Miami for spring break, and the hotels were so expensive that me and my friends stayed in a hostel for a few days to lower our costs. It was an experience, but the living wasn’t comfortable and had I known about Airbnb I probably would have tried it out. George presented an interesting point in his comment about how Airbnb may have an effect on the hotel industry. I think, if it continues to grow, Airbnb could cause hotels to lower their prices, but generally I think a different type of consumer is attracted to Airbnb than to, say, the Ritz. The experiences are really different, and if people have money to spend and like the luxury, expensive hotels will have no shortage of demand.

  3. Although I have never heard of Airbnb before, I have heard about home exchanges. At websites like HomeExchange.com you can pay a monthly fee to eventually swap homes with someone for a certain amount of time at no cost. Although these services, such as Airbnb and HomeExchange, help eliminate some of the costs of travelling, the concept concerns me. Do these websites have some sort of background check? Watching the video, a couple with a baby opened the door to their house to strangers. Even if the website and service was deemed perfectly “safe” I would still have trouble trusting a complete stranger to share living quarters with me. Similar to Airbnb, I would have a very hard time leaving my home to a stranger using HomeAway while I was in a different country or even continent. Call me paranoid, but I would much rather spend the money to have that extra security.

  4. Great post! I had never heard of home sharing like this, but I find it very interesting. As George pointed out, if this were to grow, it could make the hotel industry obsolete. However, I don’t think that will happen because of the issue of safety. Although it is a great option for people who are short on cash; for people who are able to pay for hotels, I believe they will always pay that extra amount of money for the security that a hotel presents. Also, I wonder how large this company can grow because I don’t know how many people would be willing to let strangers stay in their home. If the number of people who put their homes out to be used does not grow, this company will not be able to succeed in the long term.

  5. I really enjoyed reading this post and learned so much from it. Prior to your post, I had no idea that Airbnb existed and I am very interested in learning more about it. This company certainly illustrates the possibilities that technology and the Internet have created in today’s society. While many argue that technology is destroying personal relationships, I think that Airbnb is an example of how technology can also connect people that otherwise would not be able to meet. Once again, this brings us back to the whole double-edged sword idea, and in this case Airbnb shows the positive elements of technology.

  6. Thank you for sharing this! I felt genuinely surprised browsing the Airbnb website. It felt like a mix of Tripadvisor and Trulia, and convinced me that I could be given sufficient information to comfortably gauge the quality of a home. However, I would guess Airbnb’s methodology for rating the qualty of a renter is less robust, as evidenced by the example given in your post. What do you think are Airbnb’s competitive resources? Can an organization like Tripadvisor simply create a branch dedicated to the same services?

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