Breaking the tether

Last week saw Airbnb’s latest results – I know, it’s so exciting after all these years to finally see what they can do given a chance to spin some numbers. Well it was lots of fun. One of the key fun points was that 24% of nights booked in Q1 were not for traditional travel, but for long-term stays (defined as stays of 28 days or more). 

This was up from 14% in 2019, with Airbnb commenting that “an increasing number of guests are discovering that they do not need to be tethered to one location to live and work”. CEO Brian Chesky said: “What that basically means is a quarter of our business isn’t travel, it’s living. After 28 days, you’re probably not traveling. And I think what this is a trend of is that traveling and living are going to begin to blur together.”

Chesky was willing to throw business travel in too, commenting: “You may also see business travellers traveling together. So let’s say three different employees work in three different cities, and they have to come back to headquarters, they may not all get three different hotel rooms or Airbnbs. They might get one house. They can split the cost. They can eat around the breakfast table in the morning.”

This might seem like something of a chicken/egg sharing conundrum. Someone has to own the property for everyone to be living in it, if we’re all going to be nomads, or it just becomes some kind of swirling vortex of musical houses and where it stops, nobody knows. All this globe trotting, wherever I lay my hat antics have to be fuelled by hard property. Do you want to go to the effort of owning if you’re never going to be there?

Well someone has to and in late February the group launched its first large-scale marketing campaign in five years, Made Possible by Host, educating guests about the benefits of being hosted, and the group said: “inspiring more people to become hosts”.

It also launched an accompanying digital campaign that’s focused on recruiting new hosts, alongside a redesign of the end-to-end experience of being a host on Airbnb.

This is all very wholesome and if you look at the ad campaign it’s not an investor pitch with bar charts and ROI. But in the new world order of nomads, who owns what and why? Airbnb was never about single hosts, no matter what the ad campaigns said, with professional investors piling into what were great returns. 

When asked, Chesky told analysts that 90% of the hosts were “everyday people”, “individuals”. He meant to imply, no doubt, that they only had one listing. I think most people reading this would feel that they too were individuals. One fears for the 10% who don’t fall into that category. It’s never too late, get some comedy socks. 

Being a super awesome individual doesn’t stop you running a large PE house or real estate investment group. Chesky said that the top occupations of the group’s hosts were healthcare workers, educators, and people in food and hospitality. So much like, say, Chris Nassetta. Healthcare aside. 

The group went into almost no detail in its IPO prospectus last year about how many owners owned multiple sites and might be doing this for profit as opposed to leaping onto the next groovy trend, with added stars and rainbows. 

That’s as you might expect given that, pre-pandemic, plenty of big cities were out for blood, particularly the blood of mass Airbnb owners. Things have changed now – as we saw in the FT last week, Barcelona is being reclaimed by people who want to tether themselves there and not learn the names of new neighbours every month, all for cheaper rent.

Chesky was a little more open on the call. Out of 4 million hosts, 3.5 million were the much-prized “individuals”, but he added: “That being said, we welcome all hospitality providers on Airbnb, and we have hundreds of thousands of professional hosts and professional hospitality providers.”

He was eager to bring on more of the latter “to fill in our network gaps” and to that end the company was “continuing to develop new tools and services over the coming years to continue to welcome these providers on to our platform” and, he said: “I think they’re going to obviously benefit from all the demand that we have”.

Are we back to Airbnb as platform for all, including hotels? Will we seen the return of Hotel Tonight? Could well be. Chesky told the assembled that on 24 May, “we will announce the most comprehensive update to the Airbnb service in 12 years”.

Turn on, tune in, untether 

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