Business is booming, says Airbnb CEO
This article, Business is booming, says Airbnb CEO, originally appeared on CNET.com.
Airbnb CEO Brian Chesky says the company is doing very well. Asa Mathat for Re/code
Airbnb CEO Brian Chesky said Wednesday that the company is generating enough revenue that it doesn't need to raise any more money from investors.
"We are already the largest provider of accommodations on the planet and we're growing really really quickly," he said. "I think the biggest thing that's happening is that Airbnb is going mainstream."
Chesky was speaking with Co-Executive Editor Kara Swisher at Recode's Code Conference in Rancho Palos Verdes, Calif., about the highlights and hurdles of Airbnb. The company is a peer-to-peer home rental marketplace, founded in 2008, that's gone from catering to couch surfers to having a massive online presence. It now has more than a million listings with hosts in 34,000 cities in nearly 200 countries.
Chesky is one of three co-founders of Airbnb. He and his cohorts came up with the idea for Airbnb after deciding to rent out air mattresses in their apartment after struggling to make rent. They listed their apartment online as an "air bed and breakfast" and it caught on. Now people can rent a barn, castle or Airstream through Airbnb, along with rooms in hosts' homes.
Airbnb gets between 9 percent and 15 percent of the cost of each rental, and it's impressed investors with its potential: Airbnb has raised $794.8 million making it one of the top ten highest-valued venture-backed companies in the world with a valuation of $10 billion. Chesky declined to disclose any specific numbers on its profit or revenue.
When asked why he thinks the company is doing so well, he said "tourism is a $2.5 trillion market" and that "the goal of the business is to make money."
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Despite Chesky saying Airbnb is doing well financially, he said there are no imminent plans for going public with an initial public offering. "We are going to stay independent," he said. "Whenever we start working on an IPO, that's a two-year project."
While business is booming for Airbnb, the company is not without its woes. Critics of Airbnb say taking apartments off the market for short-term rentals means cities lose the tax revenue hotels would pay, while also reducing rental stock and exacerbating the housing crunch. Airbnb has battled regulators in the US and Europe over these issues. The company says short-term rentals help people make ends meet or pay off their mortgages, while also bringing more visitors to cities.
During the Recode Code Conference, Chesky said Airbnb is now trying to partner with governments and have conversations with lawmakers city by city. While the company has come to agreements with cities like Portland, Ore., and San Francisco, Calif., Chesky said the most difficult city to work with has been New York.
"I'm from Albany in upstate New York," he said. "When I started Airbnb, I wouldn't have thought we would have the biggest challenges around the world."
