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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

#111

Post by abduhl »

jameslk wrote: post #24
justadooda wrote: post #3

I plan on shorting Airbnb once it IPOs. It will only go down in the short term. Regulations were at an all time low and will slowly ramp up. For better or for worse, these regulations will hurt Airbnb. I'd be curious to hear from anyone who seriously thinks Airbnb will be able to achieve substantial growth in the next 5 years, given the increasing likelihood of a slowdown and more regulations from large cities.

1. There's usually a limited number of shares to short an IPO 2. Given the extreme volatility of IPOs and small amount of past history on a company's fundamentals, this will essentially be gambling with the potential of unlimited downside Good luck!

Shorting any stock always has the potential of unlimited downside. The only thing that makes this different is your personal evaluation of the riskiness (i.e. - "essentially gambling"). All stock positions are "essentially gambling" when taken to the extreme.

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

#112

Post by nerfhammer »

conanbatt wrote: post #57
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%…

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?

network effects. Buyers want to be where the most sellers are and sellers want to be where the most buyers are.

to win over an existing market you need to offer something dramatically better somehow or angle it dramatically differently, not just a 3% cost difference. Remember craigslist was basically free.

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

#113

Post by warp_factor »

I'm a regular user of Airbnbs AND hotels.

I usually prefer staying in hotels and will look for Airbnb only as a second choice.

Reasons are:

- Price is usually higher on Airbnb.

- Airbnb crazy fees for multiple people, cleaning scam, outrageous service fees etc.

- Inconvenience to not have a 24H reception where I can get my keys.

The real genius of Airbnb is that they convinced a lot of people that they shouldn't look for Hotels anymore, which sadly is what a lot of my friends are doing (automatically looking for an Airbnb).

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

#114

Post by cc439 »

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.

I'd argue that CL actually has a fantastic UI, it presents all the information you need, and nothing you don't, in a format that is quick to read. The only feature it's missing (or was missing the last time I needed it) is a map based list of housing for rent so you can simply filter out 90% of the listings that you'd never consider based on location anyways. That and a "prevent all Craigslist stereotypes from responding to my listing" button.

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

#116

Post by uniformlyrandom »

warp_factor wrote: post #113

I'm a regular user of Airbnbs AND hotels. I usually prefer staying in hotels and will look for Airbnb only as a second choice. Reasons are: - Price is usually higher on Airbnb. - Airbnb crazy fees for multiple people, cleaning scam, outrageous service fees etc. - Inconvenience to not have a 24H reception where I can get my keys. The real genius of Airbnb is that they convinced a lot of people that they shouldn't look…

This is purely anecdotical. Short-term rentals exist mostly because of high hotel prices (well, and poor hotel service - but that is already covered by the high price, as 'high price' is a term relative to the quality of goods).

I always check prices on hotels and airbnb, and I mostly book airbnb. Because it is cheaper (even with fees and everything).

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

#117

Post by mylons »

ivalm wrote: post #109
jameslk wrote: post #93

Earlier quoted context omitted.

Yes, my bad, you are correct on that. I meant more that options don't renew. I came to edit it after I thought that through but too late I suppose.

options renew in the same way any insurance renews after the contract is up -- you pay additional premium for additional duration.

he doesn't know what options really are. every comment he's made demonstrates that.

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

#118

Post by atombender »

cc439 wrote: post #114
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.

I'd argue that CL actually has a fantastic UI, it presents all the information you need, and nothing you don't, in a format that is quick to read. The only feature it's missing (or was missing the last time I needed it) is a map based list of housing for rent so you can simply filter out 90% of the listings that you'd never consider based on location anyways. That and a "prevent all Craigslist stereotypes from respon…

But it's not about presenting information. It's a completely different experience.

AirBnB handholds the traveller from the moment they start looking to when they're going on the trip. CL just presents an ad, and lets the parties email/text on their own. AirBnB handles the financial transactions, with all that that entails, and CL does not. AirBnB facilitates the communication between the landlord and the customer. They also let you add on "experiences" as part of your trip. They also include an identity verification system for both landlords and consumers, and there's a review/rating system for both. It might not be perfect, but Craigslist has nothing like it. For example, I generally avoid renting places that don't have reviews, and landlords can choose to ignore/reject renters who have built up a bad reputation.

CL, on the other hand, has a reputation for being full of scammers and other shady people.

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

#119

Post by gandutraveler »

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%…

Airbnb has long way to go to be major player in hotel/rental market space whereas Uber has effectively killed taxi companies and is the market leader.

IMO demand for ridesharing will not lower in bad economy compared to Airbnb which is driven by consumers mostly using during travel.

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

#120

Post by gehwartzen »

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

I suppose the landlords could port their reviews to a new platform by linking to the Airbnb listing similarly to how people used to post their eBay reviews when selling on forums. But yeah having all those reviews viewable natively for comparison is nice for renters.
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