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Ahead of IPO, Airbnb achieves profitability for second year in a row

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Re: Ahead of IPO, Airbnb achieves profitability for second year in a row

#81

Post by jimbokun »

rifung wrote: post #74
aboutruby wrote: post #50

Earlier quoted context omitted.

Booking is at 78.68B. From first hand experience I think Airbnb's technology is at least 10x better than Booking's (I visited and talked to both Airbnb and Booking.com employees in their respective offices).

> I think Airbnb's technology is at least 10x better than Booking's Perhaps a cynical or unpopular point of view but until the technology becomes a hindrance, does that really matter? Its not as though people are going to these sites because they have great technology. They go to them because the prices are good and they have good UX I assume?

I'm assuming "technology" means the UX in this case, and it is absolutely a big part of the reason I keep coming back to AirBNB while I plan an upcoming vacation with multiple stays. I can find places with the constraints I'm looking for quickly, and conveniently see them laid out on a map. The UX on other sites I've tried make it more difficult to find places where I want to stay.

Re: Ahead of IPO, Airbnb achieves profitability for second year in a row

#83

Post by dajohnson89 »

jimbokun wrote: post #81
rifung wrote: post #74

Earlier quoted context omitted.

> I think Airbnb's technology is at least 10x better than Booking's Perhaps a cynical or unpopular point of view but until the technology becomes a hindrance, does that really matter? Its not as though people are going to these sites because they have great technology. They go to them because the prices are good and they have good UX I assume?

I'm assuming "technology" means the UX in this case, and it is absolutely a big part of the reason I keep coming back to AirBNB while I plan an upcoming vacation with multiple stays. I can find places with the constraints I'm looking for quickly, and conveniently see them laid out on a map. The UX on other sites I've tried make it more difficult to find places where I want to stay.

AirBnb's excellent UX wins me over. What pushes me away, is the hidden fees (service, cleaning, extra $ for 2+ guests, etc).

Re: Ahead of IPO, Airbnb achieves profitability for second year in a row

#84

Post by hndamien »

mbesto wrote: post #77
gringoDan wrote: post #43

They're often considered similar businesses, but intuitively it seems to me that, long-term, Airbnb will be valued higher than Uber and other ridesharing companies. Home rentals seem to be simpler market to operate in than coordinating real-time supply and demand between drivers & riders. Additionally, Uber seems to be facing issues on the driver side of the business - they have a $650 driver acquisition cost & a 12%…

They're compared because they own the distribution in their respective markets. That's key. That being said, here are the risks on the supply side for both in very different ways: - Uber: Drivers are fungible and can move to any platform they want. Two risks here...unbundling (already happening) and driver acquisition cost. - ABnB: If their supply bundles itself together, it doesn't need to pay a distribution fee and…

The economics are also much works for an Uber driver than an AirBnB host.

Re: Ahead of IPO, Airbnb achieves profitability for second year in a row

#85

Post by conanbatt »

gringoDan wrote: post #69
conanbatt wrote: post #57

Earlier quoted context omitted.

What im not sure about is Airbnb's moat. They have a great brand name and all, but their service is very limited: 15% is a very large cut to take on these transactions. What prevents another company from doing the same at 12% and costing 50% to operate?

Nothing prevents another company from doing that, but all of the hosts & guests are already on Airbnb. Two-sided marketplaces are very difficult to start, but once they have some momentum, it's even more difficult to unseat them. Look at Craigslist - terrible UI, hundreds of startups have tried to challenge it in the past 15+ years, and yet it's still my go-to when I need to sell some old furniture.

Craigslist has a fantastic moat: they are insanely operationally efficient. To make more money than craigslist at a lower cost is virtually impossible.

The real entrance cost to becoming a host in airbnb is not airbnb, its having a house. And a host will use airbnb or whatever to keep the appartment occupied. It can absolutely be commoditized, much like Lyft and Uber have. A service that posts your apt in multiple websites would make that permanent.

Today they must own the demand side: i have never seen something become so popular with no little ads (particularly in argentina, it was incredible to see it going from 0 to ubiquitous in 2 years). But demand on apartment rentals is incredibly price sensitive, demonstrated by the competition airlines have.

Re: Ahead of IPO, Airbnb achieves profitability for second year in a row

#86

Post by conanbatt »

xeromal wrote: post #71
heurist wrote: post #60

Earlier quoted context omitted.

Their social network and brand recognition is their moat for now. Hosts and guests trust Airbnb. An upstart will have overcome a lot of momentum to take on Airbnb in the broad market.

The reviews are worth the price of admission

They are valuable for sure, but are they 1/7 appts rented out?

Traditional vacation rentals charge 15~20%, but they truly handle the key hand offs and such.

Re: Ahead of IPO, Airbnb achieves profitability for second year in a row

#87

Post by conanbatt »

zethraeus wrote: post #63

Can anyone here speak to AirBnb's continued growth. Rumors say it's plateaued and even public articles suggest the same https://skift.com/2018/11/14/airbnbs-growth-is-slowing-amid-...

I've found the things like ""experiences" and related offerings to be a red flag over their capacity to grow or keep their advantage.

Still, they are killing it, truly.

Re: Ahead of IPO, Airbnb achieves profitability for second year in a row

#88

Post by rconti »

jedberg wrote: post #7
ianhawes wrote: post #6

Earlier quoted context omitted.

I will sell you the puts myself. You're ignoring a massive market for vacation rentals outside of major metropolitan areas that AirBnB has conquered from craigslist. The risk for regulation has passed as citizens see AirBnB as an accepted reality. Hotels aren't happy, but rightfully see AirBnB as a competitor.

> The risk for regulation has passed as citizens see AirBnB as an accepted reality. Hotels aren't happy, but rightfully see AirBnB as a competitor. I agree with your overall, but I'm not so sure I agree with this part. South Lake Tahoe just passed a voter initiative in November that bans AirBnB (and VRBO) except for a few places right next to the major hotels. It was, not surprisingly, heavily supported by the major…

Pacific Grove, too. I was just staying in an AirBnB in PG in October. Signs in yards opposing "measure M" which turned out to be an initiative to "keep Pacific Grove a community"... which means no short-term rentals.

Re: Ahead of IPO, Airbnb achieves profitability for second year in a row

#89

Post by asteli »

conanbatt wrote: post #85
gringoDan wrote: post #69

Earlier quoted context omitted.

Nothing prevents another company from doing that, but all of the hosts & guests are already on Airbnb. Two-sided marketplaces are very difficult to start, but once they have some momentum, it's even more difficult to unseat them. Look at Craigslist - terrible UI, hundreds of startups have tried to challenge it in the past 15+ years, and yet it's still my go-to when I need to sell some old furniture.

Craigslist has a fantastic moat: they are insanely operationally efficient. To make more money than craigslist at a lower cost is virtually impossible. The real entrance cost to becoming a host in airbnb is not airbnb, its having a house. And a host will use airbnb or whatever to keep the appartment occupied. It can absolutely be commoditized, much like Lyft and Uber have. A service that posts your apt in multiple we…

I have friends who worked at Craigslist, and was astonished to hear them describe a team of IIRC 35-40 employees. They have somewhere around 50 now? Makes you wonder what those 3k+ employees at Twitter all do.

Re: Ahead of IPO, Airbnb achieves profitability for second year in a row

#90

Post by hrez »

jameslk wrote: post #67
hrez wrote: post #54

Earlier quoted context omitted.

I couldn't help but notice that by that logic auto insurance is a bad idea. Not only you have to be right that you get into an accident. But also you have to get into that accident before contract expires. Would he pay premium for the options? - Sure. But that buys something. Limiting the loss vs shorting for example. Besides shorting isn't exactly free either.

Auto insurance is risk management, not investing. Auto insurance doesn't expire. OP can keep being wrong for years, buying options over and over until they're no longer liquid. I guess you can do that with any stock. The market already prices that in (implied volatility as I mentioned). The point is, you don't use options for investment decisions where you don't know the timing of when you'll be right, unless you're…

>Auto insurance doesn't expire.

Every single auto insurance in US I had is a 6 or 12 month contract which expires at the end. The expiration time/date is very specific to the minute. You usually get a new contract after that which you can choose to pay premium for or loose coverage otherwise.

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