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Airbnb to double bookings to 80 million this year: investors

Tuesday, September 29, 2015 - 07:21
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Airbnb is expected to double its nightly bookings this year, investors familiar with the company's performance said, a sign that the home and room renting site's battles with regulators have yet to dent its rapid global growth.

[SAN FRANCISCO] Airbnb is expected to double its nightly bookings this year, investors familiar with the company's performance said, a sign that the home and room renting site's battles with regulators have yet to dent its rapid global growth.

The website is expected to have about 80 million nights booked this year, up from about 40 million in 2014, according to the investors, who declined to be named.

Airbnb does not disclose nightly bookings and would not comment on the figure.

This pace of growth is expected to continue or accelerate, the investors said. The company says it has more than 1.5 million listings - homes, apartments, guest rooms, even houseboats and tree houses - in more than 34,000 cities in 190 countries. "It's a global phenom," said Keith Rabois, a partner at Khosla Ventures who made an early personal investment in Airbnb in 2010. "(It) is going to continue to grow at a substantially higher rate than other businesses." Unlike hotels, Airbnb does not own properties and is not responsible for services like housekeeping.

The research arm of investment bank Piper Jaffray estimated earlier this year that the service would have about 61 million nightly bookings in 2015. But the company has blown past that estimate, the investors said.

Its growth comes despite Airbnb's ongoing battle with regulators and lawmakers over who can list properties and how they should be zoned and taxed.

In its hometown of San Francisco, a proposed law on the November ballot would limit the use of homes as hotels through services such as Airbnb. Supporters of the law argue that Airbnb exacerbates the city's brutal housing shortage.

Some travelers prefer to use Airbnb not just for the cheaper price but also options such as renting an entire house, enjoying quiet neighborhoods lacking in hotels and benefiting from their host's local knowledge.

Travel industry analysts say the growth rate suggests Airbnb's push in Europe and efforts to win over business travelers are succeeding. "Airbnb is certainly being very, very aggressive," said Henry Harteveldt, founder of travel research firm Atmosphere Research Group.

Paris has more listings on Airbnb - about 60,000 - than any other city, said an Airbnb spokeswoman. About 50 per cent of the company's revenue comes from Europe compared to about 30 per cent from the United States.

Some homeowners in European cities have reported receiving letters from Airbnb inviting them to list their homes on the site.

The company is also going after the booming Chinese travel market, working with Sequoia China, the local affiliate of the American venture capital firm.

Once a startup selling cereal, Airbnb today is the third most valuable venture capital-backed company in the world, valued at US$25.5 billion. By comparison, Hyatt Hotels Corp has a market value of about US$6.7 billion.

In a survey of 300 hotel groups and hotels earlier this year by Atmosphere, 70 per cent said Airbnb and similar home-sharing services would pose a significant threat to their business within the next three years. "If Airbnb is on track to book 80 million rooms nights a year, that is 80 million room nights that the global hotel industry is not getting," Mr Harteveldt said.

REUTERS