Over the past 10 years, Airbnb has cemented its position as a major player in the “sharing economy” along with Uber, using software technology to create a multi-billion dollar company within the hospitality industry. It now lists around 5m places to stay, across 81,000 cities and almost 200 countries, and boasts more than 300m customer bookings, leading Forbes to estimate the company to be worth $38bn in May this year.
The boom in short-term holiday lets has created a handy moneymaking opportunity for those with space to spare. The average Airbnb host in Britain earned £3,100 in 2017 from letting out their home or spare room, according to the company’s annual report, and that was with an occupancy rate of just four nights per month (equating to an average overnight rate of £65).
For the uninitiated, Airbnb is a website that allows ordinary people to list their unused rooms as if they are hotels. Guests can search for a spare room in someone’s home, an entire apartment or house – or even a unique or luxurious destination such as a treehouse or a castle. In its most recent report the company said its British hosts made £854m in the year to July 2018.
Apart from being a major disruptor of the short-term accommodation industry, Airbnb’s astronomical growth is fuelling the creation of start-up companies around the world, especially property management firms. In the UK alone, there is a growing list of these start-ups that act as intermediaries between hosts and guests of Airbnb, or provide services that Airbnb doesn't. They include cleaning services, property management, customer checking and even pricing advice.
As Reid Hoffman, co-founder of LinkedIn aptly said of these companies: “Start-ups take advantage of the scale, durability and efficiency in the Airbnb marketplace, which helps them find guests and grow quickly. All start-ups start with zero users; they need to get in front of users to grow. Big platforms like Airbnb have lots of users.”
Airbnb didn't start out anticipating the emergence of these companies, but over time it has become receptive to them. In 2015 the company created a “Host Assist” section on its website, listing offshoot companies that provide services to hosts.