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.
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.
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