Most Disruptive Sharing Economy Business

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Most Disruptive Sharing Economy Business
Airbnb
AIrbnbisa website forpeople torentoutlodging. Itisa communitymarketplace forpeople tolist,
discoverandbookunique spacesaroundthe worldthroughmobile phonesorthe internet.Froman
apartmentfora night,a castle fora week,ora villafora month,Airbnbconnectspeopletounique
travel experiencesatanyprice point. The companyis one of the mostdisruptedbusinessmodelsin
sharingeconomysector.
Airbnbwasfoundedin August2008 by Brian Cheskyand Joe Gebbia,andiscurrentlyheadquarteredin
San Francisco,California,USA. The companyisprivatelyownedandoperatedbyAirbnb,Inc.The
companyreportsover500,000 listingsworldwide,andhavingservedover17million guestsacross
33,000 citiesand192 countries.

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BusinessModel
If I have an apartmentinSan Francisco,andI'm goingto be away fora week,andyouwantto stay inmy
apartment,Ishouldbe able to charge you forthe privilege.Yougetafurnished roomforlessthanthe
cost of a hotel,andI getto put myapartmentto workmakingmoneybackwhenit wouldotherwise be
empty.Thatthe BusinessModel of Airbnb. Itisupgradedbusinessmodelof the company.
Airbnbrunson a marketplace platformmodel where itconnectshostsandtravellersandenables
transactionswithoutowninganyroomsitself. Thisplatformdisrupts the traditional industriesby
creatingnewsourcesof supplyandrelyingoncuration (managementactivitiesrequiredtomaintain
researchdata long-term) fordevelopingquality. Unliketraditional hotels,Airbnbscalesnotbyscaling
inventorybutbyincreasingthe hostsandtravelersandmatchingthemwitheachother
AIrbnb has used the network orchestrator model where theyleverage the power of networkin
creating a new cross-industrytransformation to the hotel industry.
Its veryunique model whichitincorporatedisthatwithagrowingcommunityof users,Airbnbalso
providesaneasywayfor people tomonetizetheirextraspace and showcase ittoan audience of
millions.
Registeringon Website
Users are categorizedas“Hosts” and “Guests;”bothof whichmustregisterwithAirbnbusingavariety
of means.A valid email addressandvalidtelephone were initiallythe onlyrequirementstobuilda
unique userprofileonthe website,howeverasof April 2013, a scan of a governmentissuedIDisnow
required.
Profilesinclude detailssuchasuser reviews andshared social connections tobuildareputation and
trust amongusersof the marketplace.Otherelementsof the Airbnbprofile includeuser
recommendationsandaprivate messagingsystem. Thissocial connectionwhichwasintegratedin
2012, completelytransformedthe searchexperience onAirbnb. Airbnb'simplementationof Facebook's
social graph addsan importantlayer of contextthatgivenusersmore confidence inthe booking
process.

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In additiontoprovidingpersonal information,hostsdisplaylistingdetailsincluding price,amenities,
house rules,imagery,anddetailedinformationabouttheirneighborhood.Due tothe nature of the
business,ameritsystemisinplace toallow guestsandhoststo leave referencesandratingswhichare
displayedtothe publicinordertoprovide anevaluationmethod.
SignupProcedures
It isfree to create a listingusingAirbnb.Usersfilloutaform with initial details.Changescanbe made at
a laterdate.The listingwillnotgolive until the userisreadytopublish.Pricingcanbe determinedby
the user.Users can charge differentpricesfornightly,weekly,andmonthlystaysaswell asseasonal
pricing.The TitlesandDescriptionssectionscanbe usedtoadvertise theirspace.Theycanoutline house
rulesor otherdescriptionsregardingthe residence.Airbnballowsuserstopublishupto24 photographs
of the place.Airbnb,ona limitedbasis,isofferingfree professional photographyinmostof the listed
areas.Profile isaplace where the guestscan researchmore aboutthe users.Thissectionisoftenused
for usersto displaywhotheyare aswell astheirphilosophiesonhosting.
Guestsare requiredtomessage the userdirectlythroughAirbnbtoaskquestionsregardingthe
property.Usershave 100% control overwhobookstheirplace.Whena potential guestputsina
reservationrequest,the hosthasat least24 hoursto accept or decline the request.
Afterthe useracceptsa reservation,theycancoordinate meetingtimesandcontactinformationwith
guests.Afterthe reservationiscomplete,usersare encouragedtoleave areview.Reviewshelpbuild
validityandreferencesbothforthe guestsand the host
Mobile Procedure
Airbnbalsohasmobile appsoniOSand AndroidOS. Asof September2012, usershaddownloadedthe
mobile applicationover1milliontimeswhichaccountsforover26% of the company’soverall traffic. In
November2013 Airbnblaunchednewversionsof itsiOSandAndroidapps,addingthe abilityforhosts
to communicate withguestsandresponddirectlytoguestmessages.Thisservice waspreviouslynot
available onmobileappof Airbnb.
Payment Module
Airbnbfacilitates online payments fromguesttohostthroughitsSecurityPaymentsfeature which
processespaymenttransactions24hoursaftercheck in.Thisprotocol offersa guarantee forguestsand
helpstoupholdhostcancellationspoliciesbefore processingpayments.Additionally,the Airbnbwebsite
facilitatessecuritydepositsandcleaningfees,the formerof whichishelduntil the propertyisvacated.
The company’srevenue comesfroma6% to 12% commissionof the guestpaymentand3% of whatthe
hostreceives.
Funding
Till nowAIrbnbhasreceived$794.8 millioninvestmentfrom20 investorsin6 roundsof funding.
Merger& acquisition
FoundedinAugust2008, Airbnbhasacquiredseveral of itscompetitors,including Accoleo,
CrashPadder,NabeWise,andLocalmind.Intotal the companyhas gone through7 strategicacquisitions.

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Pencil Labs-Dec2014
Pencil Labs,creatorof Wyth-the schedulemakerapp, wasacquiredbyAirbnbforan undisclosed
amount.
Localmind-Dec,2012
Localmindwhichisa location-basedinformationplatformprovidingreal-timeanswersfordestination-
relatedquerieswasalsoacquiredbyAirbnbto___
Fondu-Oct,2012
An online communityforsharingbite-sizedreviewsaboutplacestoeatanddrinkwas alsoacquiredby
the companyin 2012 for$575k.
NabeWise-July,2012
The mobile appthat structureslocal dataand performsa qualitativeanalysistoprovide userswith
insightintoneighborhoods-NabewisewasboughtbyAIrbnbin2012. Thisacquisitionshiftedthe
companyfocustoward offering hyperlocalrecommendationstotravelers
Crashpadder-March,2012
Londonbasedpeer-topeeraccommodationwebsite wasacquiredbyAIrbnbto getholdof sharing
economyinLondon whichwasmade prior to 2012 SummerOlympic .Thisacquisitionmade Airbnbthe
largestpeer-to-peeraccommodationswebsite inthe UnitedKingdom.
DailyBooth-Jan,2012
San Franciscobasedphotobloggingwebsite thatenableditsuserstotake photosof themselves was
acquiredbyAirbnbinall cash deal.
Accoleo-June,2011
The acquisitionof Accoleo,basedinGermany, amarketplace thatallowsstudentstorentouttheirflats,
extrabedsor couchesto otherstudentsalsowasa part of theirstrategy toincrease theirsharing
economypresence inGermany. Thiswasthe firstinternational expansionof the company.

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Investment
AIrbnb,Inchas invested$3millioninloungebuddy inFebruary2015, which isthe onlysingle resource
for travelerstobe able tolocate,review,andaccessairportloungesaroundthe world.
Scandinavia'sleadingholidayrentals websites-SunnyRentals,TUIgroups’online vacationrental market-
Atraveo,private communityof people whichallow rentingandlettingshorttermaccommodationto
each other– 9flats are some of the competitorsof Airbnb.
Awards
 In December2012, Apple honoredAirbnbwiththe Editor'sChoice awardforthe BestMobile
Applicationof 2012 inthe UK market.
 Airbnbwasalsoawarded Most Disruptive Service of 2012
 Best DesignAwardin 2015 byAnnual CrunchiesAwards.
Apart fromthisthere were some negativenewscomingup forAirbnblike thatapartmentburglarized
and vandalizedbyan Airbnbguest. Inresponse tothisAirbnbrecommendshostsobtaininsurance which
coversdamagescausedbyguests. Airbnbthemselves offerssecondary insurance,callingitahost
guarantee.

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Ref:
http://techcrunch.com/2014/09/18/airbnb-cfo-andrew-swain-has-left-the-company/
https://www.crunchbase.com/organization/airbnb
http://mashable.com/2011/05/10/airbnb-social-connections/
http://gizmodo.com/5918204/read-these-tips-or-nobody-will-ever-let-you-be-an-airbnb-guest-again
https://www.airbnb.co.in/support/getting-started/how-to-host
http://upstart.bizjournals.com/news/technology/2012/12/14/app-store-best-apps-of-2012.html
http://www.cnet.com/uk/news/whatsapp-tops-apple-2012-list-airbnb-and-iplayer-honoured/
https://hbr.org/2014/11/what-airbnb-uber-and-alibaba-have-in-common