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Airbnb, Inc.
"Privately held company
Industry "Lodging
Founded August 2008; 9 years ago (2008-08) in "San Francisco, "California, "United States
Headquarters 888 Brannan Street, San Francisco, California
Area served
Key people
Members 200,000,000 (2018)
Number of employees
3,100 (2017)
Footnotes / references

Airbnb is an American company which hosts an "online marketplace and "hospitality service, for people to lease or rent short-term "lodging including "vacation rentals, "apartment rentals, "homestays, "hostel beds, or "hotel rooms. The company does not own any lodging; it is a "broker which receives percentage service "fees from both guests and hosts in conjunction with every booking.[6][7][8] In January 2018 the company had over 3,000,000 lodging listings in 65,000 cities and 191 countries.[4]

How it works[edit]

Airbnb iPhone app screenshot

Airbnb can be accessed via either the Airbnb websites or "mobile applications for "iOS, "Apple Watch, and "Android.[9] Registration and account creation is free.[10] On each booking, the company charges guests a 6%-12% guest services fee and charges hosts a 3%-5% host service fee.[11] Hosts can also offer "experiences", such as excursions, to guests for an additional charge, of which Airbnb takes 20% as a commission.[11][12]

Users can search for lodging using a variety of filters including lodging type, dates, location, and price.[13] Before booking, users must provide a valid name, "email address, telephone number, photo, payment information, and, if required by the host, a scan of a government-issued ID.[14][15] Guests also are required to agree to any "house rules of the host.[14]

Offering lodging[edit]

Users can create a listing by selecting the "Host" menu after logging in.[16] A listing will not go live until the host is ready to publish.[16] Pricing is determined by the host, with recommendations from Airbnb.[16] Hosts can charge different prices for nightly, weekly, and monthly stays and can make adjustments for seasonal pricing.[16] Hosts add descriptions of the residence, "amenities, available dates, cancellation policies, and any "house rules[17] and hosts are advised to upload photos of the lodging that is offered.[18] For eligible hosts, Airbnb offers free professional photography.[19] Potential guests are required to message the host directly through Airbnb to ask questions regarding the property. Unless the host has enabled "instant book", in which case requests for stays are accepted automatically, a host has 24 hours to accept or decline a booking.[20][21] After the reservation, hosts coordinate meeting times and contact information with guests.[16]

Legality of offering lodging[edit]

Some cities have restrictions on subletting for a short period of time.[22] In some cities, collection of a "transient occupancy tax by Airbnb is required.[22] In many cities, hosts must register with the government and obtain a permit or license.[22] Airbnb has published a list of regulations and requirements by city; however, only cities in the United States are included. In addition, many landlords or community associations also have restrictions on short term sublets.[23] Hosts may be required to pay income taxes on income received via Airbnb and, in the United States, Airbnb sends tax forms to hosts that have earned over $20,000 in rents and received over 200 reservations via Airbnb in a calendar year.[24]

Safety mechanisms[edit]

Airbnb had to overcome the obstacle of "stranger danger" to build a level of trust between hosts and guests and instill confidence in its platform. Founder Joe Gebbia has said that Airbnb is specifically "designed for trust" via the following safety mechanisms:[25][26]

User profiles[edit]

Airbnb requires each member to complete a profile and upload photos so that members can learn about their hosts and guests ahead of time.[27]

References and reviews[edit]

After the guest completes a stay, the host and guest have the option of leaving references for each other and reviews of their stay, which are posted publicly, providing for a "reputation.[28]


Airbnb recommends that hosts obtain insurance which covers damages caused by guests. Airbnb offers US$1,000,000 of secondary insurance, called its "host guarantee", which covers "property damage due to "vandalism and "theft.[29] When first launched in August 2011, the program covered up to US$50,000[30] but the maximum was later increased to US$1,000,000.[31][32]

Customer service hotline[edit]

The company has a 24-hour customer service hotline and a task force to review suspicious activity.[33]

Logged private messaging system[edit]

The site provides a logged private messaging system as a channel for users to message one another privately before booking and accepting reservations.[34]

Decline or cancellation of reservations[edit]

Hosts are able to decline reservations if they are not comfortable with the guest, based on online correspondence, and cancel reservations, albeit with a penalty.[35][36]

Secure payments[edit]

Airbnb facilitates payment from guest to host 24 hours after check-in via its secure "e-commerce payment system and there is no need for hosts to worry about being paid.[37]

Security deposits and cleaning fees[edit]

At the option of the host, Airbnb facilitates security deposits and mandatory non-refundable cleaning fees, the former of which is held until the property is vacated.[38]

Verification of identity[edit]

Any Airbnb host can require their prospective guests to obtain "Verified IDs" before booking, meaning that they are required to scan a government-issued ID to verify their identity.[39]

Linking to social network accounts[edit]

An Airbnb account can be linked to accounts on "social networking services such as "Facebook, thus providing the host with data on common friends and interests.[40][41][42]

Wish list feature[edit]

In June 2012, Airbnb launched a "wish list feature, offering users the ability to create a curated catalog of desired lodgings that they would like to visit.[43] Co-Founder and "Chief Product Officer, Joe Gebbia and his team conceived the idea of changing the website from an "online marketplace to a source for inspiration. Users can organise their favorite destinations into organized lists and share these lists with other users.[44]

Neighborhoods travel guide[edit]

"Neighborhoods" is a "travel guide that provides in-depth information for selected neighborhoods in 23 major cities through photos, essays, maps, tags from locals, and assessments of various criteria that would be of interest to guests such as public transportation, dining, peace & quiet, nightlife, tourist attractions, and shopping, thereby helping travelers choose the ideal neighborhood to stay in via "collaborative filtering.[45][46][47][48] The Airbnb product team hand-mapped hundreds of neighborhoods within these 23 cities and had local editors curate content for each neighborhood. Airbnb also added 70 "street photographers who generated 40,000 photographs for the project.[49]


Airbnb founder Joe Gebbia (right)

Shortly after moving to San Francisco in October 2007, roommates and former schoolmates "Brian Chesky and "Joe Gebbia could not afford the rent for their loft apartment. Chesky and Gebbia came up with the idea of putting an air mattress in their living room and turning it into a bed and breakfast.[50][51][52] The goal at first was just "to make a few bucks".[53][54] In February 2008, "Nathan Blecharczyk, Chesky's former roommate, joined as the Chief Technology Officer and the third co-founder of the new venture, called AirBed & Breakfast.[52][55] This is also where the name "Airbnb" originates from. They put together a website which offered short-term living quarters, breakfast, and a unique "business networking opportunity for those who were unable to book a hotel in the saturated market.[56] The site officially launched on August 11, 2008.[57][58] The founders had their first customers in town in the summer of 2008, during the Industrial Design Conference held by "Industrial Designers Society of America, where travelers had a hard time finding lodging in the city.[52][59]

To help fund the site, the founders created special edition breakfast cereals, with presidential candidates "Barack Obama and "John McCain as the inspiration for "Obama O's" and "Cap'n McCains".[60] In two months, 800 boxes of cereal were sold at $40 each, which generated more than $30,000 for the company's incubation.[61][62] It also got the company noticed by computer programmer "Paul Graham, who invited the founders to the January 2009 winter training session of his startup incubator, "Y Combinator, which provided them with training and $20,000 in funding in exchange for a small interest in the company.[53][63][64] With the website already built, they used the $20,000 Y-Combinator investment to fly to "New York City to meet users and promote the site.[65] They returned to San Francisco with a profitable business model to present to West Coast investors. By March 2009, the site had 10,000 users and 2,500 listings.[64]

In March 2009, the name of the company was changed to, and the site's content had expanded from air beds and shared spaces to a variety of properties including entire homes and apartments, private rooms, "castles, boats, manors, tree houses, "tipis, "igloos, private islands and other properties.[66]

One year later, there were 15 people working from Chesky and Gebbia's loft apartment on Rausch Street in San Francisco. To make room for employees, Brian Chesky gave up his bedroom and lived at lodging booked via the Airbnb service until the company moved into its first office space,[67][53] and in April 2009, the company received $600,000 in "seed money from "Sequoia Capital.[53] In November 2010, the company raised $7.2 million in financing from "Greylock Partners and again from "Sequoia Capital in a "Series A round and announced that out of 700,000 nights booked, 80% had occurred in the past six months.[68]

In February 2011, Airbnb announced its 1 millionth booking since its inception in August 2008.[69][70] In January 2012, the company announced its 5 millionth night booked internationally. In June 2012, Airbnb announced 10 million nights booked, doubling business in the previous 5 months.[71][72] Of these bookings, 75% of the business came from markets outside of the continental "United States.

On May 25, 2011, actor and partner at "A-Grade Investments "Ashton Kutcher announced a significant investment in the company and his role as a strategic brand advisor for the company.[73]

In May 2011, Airbnb acquired a German competitor, Accoleo. This "takeover, as well as other similar acquisitions, launched the first international Airbnb office, in "Hamburg.[74] In October 2011, Airbnb established its second international office in "London.[75][76] Due to the growth of international "users, in early 2012, Airbnb opened offices in "Paris, "Milan, "Barcelona, "Copenhagen, "Moscow, and "São Paulo.[77] These openings were in addition to existing offices in "San Francisco, "London, "Hamburg, and "Berlin.[78] Airbnb announced in September 2013 that its European headquarters would be located in Dublin.[79] Prior to the "2012 Summer Olympics, Airbnb acquired London-based rival CrashPadder, subsequently adding 6,000 international listings to its existing inventory. This acquisition made Airbnb the largest lodging website in the "United Kingdom.[80]

In November 2012, in the aftermath of "Hurricane Sandy, Airbnb partnered with New York City Mayor "Michael Bloomberg to offer free housing for persons displaced by the storm.[81] Airbnb built a "microsite for this effort alone where victims register for housing and meet property owners with free housing.[82] Additionally, Airbnb waived all service fees associated with these listings while maintaining the Host Guarantee for all properties listed.[83]

In November 2012, Airbnb opened an office in "Sydney, "Australia, its 11th office location, and announced plans to launch the service in "Thailand and "Indonesia,[84] At that time, Australian consumers accounted for 10% of the Airbnb user base.[85] and in December that same year, Airbnb announced its strategy to move more aggressively into the Asian market with the launch of an office in "Singapore.[86]

In November 2012, Airbnb acquired NabeWise, a city guide that aggregates curated information for specified locations.[87] The acquisition shifted the company focus toward offering "hyperlocal recommendations to travelers.[88] In December 2012, Airbnb announced the acquisition of Localmind.[89] Localmind is a location-based question and answer platform that allows users to post questions about specific locations online. These questions are then answered in real-time by experts on the specified territories.[90]

By October 2013, Airbnb had served 9 million guests since its founding in August 2008,[91] and in December 2013, the company reported it had over 6 million new guests in 2013, and nearly 250,000 properties were added in 2013.[92]

In July 2014, Airbnb revealed design revisions to the site and mobile app and introduced a new logo.[93] Some considered the new logo to be visually similar to "genitalia,[53][94] but a consumer survey by "Survata showed only a minority of respondents thought this was the case.[95]

In April 2015, following the "Obama administration's easing of restrictions on U.S. businesses to operate in Cuba, Airbnb expanded to Cuba, making it one of the first U.S. companies to do so.[96][97]

In June 2015, Airbnb sponsored the "Manor F1 Team and the Airbnb logo appeared on the front nose of the cars and on team wear including the drivers' overalls.[98]

In August 2015, Airbnb partnered with "Tesla Motors to provide chargers at certain host houses.[99]

In the summer of 2016, the "Federal Trade Commission started investigating how Airbnb affected housing costs per the request from three "US senators. In October that same year, "New York Gov. signed a bill charging Airbnb fines for violations of local housing laws. The "New York Times reported that these events were related and part of a "plan that the hotel association started in early 2016 to thwart Airbnb".[100]

In January 2017, Brian Chesky, CEO of Airbnb, tweeted that the company will give free housing to "refugees and any others not allowed into the "United States as a result of "Donald Trump’s "Executive Order 13769, which temporarily banned refugees from the United States.[101][102] Airbnb also led an investment in reservation-booking app, Resy, along with serial entrepreneurs "Gary Vaynerchuk, Ben Leventhal and Mike Montero.[103]

Airbnb first became profitable during the second half of 2016. Airbnb's revenue grew more than 80% from 2015 to 2016.[104]

In February 2017, Airbnb acquired Luxury Retreats International, a Canadian-based villa rental company, in its largest acquisition to date.[105]

In February 2017, Airbnb acquired the social payment startup Tilt. Through Tilt, on November 28, 2017, Airbnb began allows users to split payments with other travelers, working with up to 16 travelers. [106][107] On November 28, the feature became available globally.[108][109]

Also, on November 27, 2017, Airbnb had acquired Accomable, an accessible-travel startup, and had merged its team and listings with its own.[110][111]

Corporate information[edit]

Office locations[edit]

As of January 2018, Airbnb has 20 offices in:[112]

Airbnb office in "Toronto, Ontario, "Canada
Airbnb's headquarters at 888 Brannan Street, in "San Francisco, California.


Through July 2011, the company had raised "US$119.8 million in "venture funding from "Y Combinator, "Greylock Partners, "Sequoia Capital, "Andreessen Horowitz, "Digital Sky Technologies, "General Catalyst Partners[113][114] and undisclosed amounts from Youniversity Ventures partners "Jawed Karim, "Keith Rabois, and "Kevin Hartz,[115] and from A Grade Investments partners "Ashton Kutcher and "Guy Oseary.

In April 2014, the company closed on an investment of US$450 million by "TPG Capital at a company valuation of approximately US$10 billion.[116] Additional funding was provided by "Andreessen Horowitz, "Sequoia Capital, Dragoneer Investment Group, "T. Rowe Price and "Sherpa Capital.[117][118][119]

In March 2015, Airbnb raised funding at a US$20 billion company valuation.[120]

In 2015, Airbnb raised US$1.5 billion in funding led by growth equity firm "General Atlantic, and joined by "Hillhouse Capital Group, "Tiger Management, "Kleiner Perkins Caufield & Byers, "GGV Capital, China Broadband Capital, and Horizons Ventures.[121]

In September 2016, Airbnb raised at least US$555 million in new funding from "Google Capital and Technology Crossover Ventures, valuing the company at US$30 billion.[122]

In March 2017, Airbnb raised US$1 billion in additional funding, bringing their total funding raised to date to more than US$3 billion and valuing the company at US$31 billion.[123]


Many people on the brink of losing their homes through foreclosure due to financial hardship have come to depend on Airbnb for additional income.[124]


In 2014, Airbnb was the official jersey sponsor for the "Australia men's national basketball team at the "2014 Basketball World Cup.[125]

Airbnb has sponsored the "New York City Marathon since 2014.[126]


Fair housing implications and discrimination[edit]

In July 2016, former Attorney General "Eric Holder was hired to help craft an anti-discrimination policy for Airbnb after the company faced many complaints related to "racism, including a study by "Harvard Business School that showed widespread discrimination by hosts against guests whose names suggested that they were black.[127]

Privacy and terms of use[edit]

Airbnb's identity verification system "Verified ID"[128] has been perceived by many customers as excessively intrusive.[129][130][131] It requires three layers of customer identification: telephone, photo of ID (such as passport or driver's license), and verification of Facebook, Linkedin or Google+ account.

Linguist "Mark Liberman has criticized the extreme length of the legal agreements that Airbnb members are required to accept, with the site's "terms of service, "privacy policy, and other policies amounting to "55081 words, or about the size of a short novel, though much less readable".[132]

Despite having no explicit ban on hosts filming guests, Airbnb updated its terms of use in November 2014 to require that hosts fully disclose the use of surveillance equipment and security cameras to guests.[133] Previously, no such disclosure was required.[134]

Pricing transparency[edit]

When customers search for lodging, Airbnb displays per-night prices that exclude its own per-night service charges as well as possible additional costs such as cleaning fees. The total price is not revealed until the customer selects an individual property and is ready to book.[135]

In late 2015, the "Australian Competition and Consumer Commission took action against Airbnb for this form of "drip pricing. Consequently, users of Airbnb's Australian web site now see the total price of a stay including all unavoidable charges at every stage of the booking process.[136][137]

Boycott over Israeli settlements[edit]

Airbnb is on the "Boycott, Divestment and Sanctions list of companies.[138] The company was added following media reports that lodging listings included settlements in the "occupied Palestinian territories that are advertised as being in Israel or in Israeli neighborhoods.[139][140]

Housing affordability[edit]

Airbnb has faced criticism regarding its effects on housing affordability. In "San Francisco, protesters accused Airbnb of contributing to rising rental rates, as landlords keep properties off the longer term rental market and instead get higher rental rates for short term housing via Airbnb.[141] Landlords have been accused of illegally evicting tenants in order to convert properties into Airbnb listings.[142] Similar concerns have been raised in other parts of the world such as "Scotland, where an increase in Airbnb listings has alarmed the local community.[143] A study published in 2017 found that increasing Airbnb listings in a given neighborhood by 10% leads to a 0.42% increase in rents and a 0.76% increase in house prices.[144]

Allegations of tax avoidance by Airbnb[edit]

The company has been criticized for avoiding taxes by setting up a "double Irish arrangement through subsidiaries in "Ireland and "Jersey.[145][146]

Tax avoidance by hosts[edit]

In 2016, the Spanish treasury department sent letters to property owners that have not declared income associated with Airbnb.[147] In Australia, insiders said in 2016 that the hosts of the 75,000 properties listed on Airbnb would likely face increased chances of being audited.[148]

Concerns and resistance from the Hotel industry[edit]

The "Hotel industry has been faced with immense competition from Airbnb. The short term rental and lower cost of staying in a private residence has triggered much opposition from the hotels; which allege they are losing tourists and other kinds of guests to Airbnb. It is also alleged that the hotels have been forced to bring down their prices to compete with the company. Hotel associations in response, have lobbied against the company, alleging unfair treatment of having to go through several safety standards and certifications as opposed to Airbnb and its lodging. This was followed by immense lobbying from the associations and unions to implement laws imposing restrictions on Airbnb and its hosts.[149][150][151]

Government actions against Airbnb and short-term rental[edit]

Legislative bodies around the world have passed legislations attempting to mitigate the effects of Airbnb for their constituents. In 2017, San Francisco passed a law requiring Airbnb hosts to register with the city before they can rent units. Units cannot be rented for more than 90 days a year.[152] Similarly, "Portland created a new zoning code in 2016 to regulate short-term rentals and it includes several limitations, such as capping the number of bedrooms in a single unit that may be listed.[153] Additionally, Portland pledged in 2015 to dedicate part of the Airbnb occupancy taxes to affordable housing.[154] Santa Monica released a draft of a city ordinance in 2016 –which has yet to be approved– that would prohibit rent-controlled units from being listed as short-term rentals.[155]

In November of the same year, the "Government of Vancouver adopted regulations and restrictions against Airbnb hosting, claiming to protect the long term rental market which it stated was just above zero availability. The new regulations include allowing hosts to be allowed only to rent their principle residence. Hosts would also require a license, requiring a fifty four dollar acquisition fee and an annual forty nine dollar annual fee to keep the license. Also included in the regulations was the requirement to display a hosting license number when listing their rooms for rent. A voluntary transaction fee of three percent was also to be implemented per reservation, but Airbnb claimed it was unable to collect such fees, instead requesting an amendment for the hotel tax.[156][157]

The move was criticized by some rental hosts, stating it would deprive them of much needed income. These implementations were also criticized by the opposing Non-Partisan Association. Councillor George Affleck argued it was creating more bureaucracy, taxation and sticks, which was not solving the problem. He argued it made Vancouver a more difficult and costly place to live, also giving the opinion that more long term rental housing needs to be built. Airbnb's public policy manager for Canada welcomed the move of making short term rental legal, but criticized the ban on secondary suits from being rented. The company was also considering challenging the move, arguing that many family home spaces are saved for friends and relatives and would not be available for the long term rental market regardless.[156][157]

The following month, the "Government of Toronto under "John Tory, adopted similar restrictions, banning basements and non-residential units for short term rentals, also arguing it was to protect the long term rental market. The move was also criticized by some Airbnb hosts who rely on Airbnb as a source of income; with one of them arguing the states' control over their property was like living in "Stalin's era of the Soviet Union.[158] Airbnb responded in an open letter to the mayor and members of the City Council, welcoming fair competition but also made several arguments, including that Toronto's economy as a growing global hub also benefited from its listings. Many local residents depend on Airbnb for extra income and living expenses. The new economy evolved business and challenged the older business models and methods. Toronto, according to them, would benefit its reputation by adopting these newer business styles and ideas. It encouraged the city to continue to allow hosts to rent out their owned spaces, weather rooms in their house or in external spaces. All of this, according to Airbnb, brought about two hundred and ninety two million dollars into the city's economy.[159][160]

Indiana state lawmakers considered following a similar model to Arizona, which limits municipalities from interfering in private property ownership and protects Airbnb hosts. The new proposed legislation would ban municipalities from introducing zoning laws lacing restrictions on private property owners and what they can do on their lands.[161][162] A published piece on "techdirt claimed that municipalities aiming to restrict Airbnb and its hosts were about to discover that they were violating "Internet law, which according to them, do not allow Internet platforms to be punished by law because a host or user failed to comply with local laws.[163]

In Europe, the "European Union (EU) warned member states against banning sharing businesses like Airbnb and "Uber, stating that outright bans should be used only as a last resort to attain public interest and that governments should instead implement more moderate regulations, which the sharing companies have had to navigate through.[164][165] The "European Commission advocated the EU's guidelines on regulating sharing businesses companies and warned that they were pulling massive revenues generated around twenty eight billion "Euros across Europe.[166]

Awards and accolades[edit]

Airbnb won the "app" award at the 2011 "South by Southwest conference.[167]

Airbnb has been deemed the "best place to work" by the 8th annual "Glassdoor 2016 Employees’ Choice Awards.[168]

See also[edit]


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External links[edit]

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