Three years ago, Airbnb was a tiny startup that no investor wanted to touch. Whether not returning emails, or providing a flat out, “No” the San Francisco based firm had a “snowball’s chance in hell” of getting out of the gate. According to co-founder Brian Chesky, noted angel investor Paul Graham, “even thought it was a terrible idea.”
Fast forward three years, and you’ll find a flourishing organization with 130,000+ listings in over 15,000 cities in 184 countries around the globe, with 1.9 million bookings having passed through Airbnb’s doors. Since successfully attracting the likes of Sequoia Capital and Greylock Partners, as well as a handful of others including Ashton Kutcher, Airbnb saw a growth rate of over 800% between January 2010 and January 2011. It’s exactly this type of growth that’s fueling rumors of a $100 million round of funding, and a $1 billion valuation.
With the recent acquisition of Hamburg, Germany based Accoleo, Airbnb is clearly signaling that it’s ready to take its user-experience focused business model to the European market.
In the 6 weeks since the acquisition, former Accoleo employees have been on a tear; first becoming a part of the Airbnb family (and all the SFO based training that goes with it), returning to Germany to open the company’s first official European office, and finally, recruiting a hand picked selection of city representatives from some 400+ applications. The firm now has local representation on the ground in 10 cities across Germany, Austria, and Switzerland, with offices established in Berlin, Munich and Vienna in addition to the Hamburg HQ.
With more than 60% of Airbnb’s revenue generated outside the U.S. market, founders Brian Chesky, Joe Gebbia, and Nathan Blecharczyk recognized the need for expansion and localization. Much more than just translators, the Hamburg office of Airbnb has marketing and programming autonomy, allowing them to interact with consumers not only in a language they speak everyday, but in a culture they live everyday. Germany country manager Gunnar Froh adds that they’re building up an infrastructure that is much larger than the German speaking market, and expects that rollouts to other countries across Europe will follow the same localized model.
One of Airbnb’s most successful actions is to do what co-founder Brian Chesky calls “the unscalable,” meaning, getting out and meeting face-to-face with hosts that have listed their property on the platform. Sticking true to this formula, Airbnb hosted its first European meetup at the betahaus in Berlin approximately 2 weeks ago. To kick things off with a bang, both Chesky and Blecharczyk were in attendance. Approximately 70 hosts attended the presentation/Q&A/networking event, with a number of helpful ideas surfacing on how to further localize and improve Airbnb for the European market.
Coming up next week, the Hamburg office is hosting a dinner-cruise boat tour for the most active hosts in the city, offering them the opportunity to not only share their experiences with Airbnb directly, but with other hosts, further building a community of enthusiastic brand ambassadors.
And while Airbnb might be enjoying its initial EU kickoff, that’s not to say that it’s alone in the European market. The Samwer brothers, a trio infamous for their clone/poach/resell tactics (eBay, Groupon) have recently launched Wimdu, as well as Chinese sister site Irizu; and Yelp imitator Qype founder Stephan Uhrenbacher has launched 9Flats. According to Froh, Airbnb has looked into a number of issues, even consulting with a German law firm, but at the end of the day, has decided not to focus on the imitators and put its energy towards product innovation and customer experience.
“When you go to headquarters in San Francisco, it’s quite striking what people are working on there. The product that we have right now is nice, but it’s not the final product, and it’s going to change a lot over the next couple of months. And this is where all that effort goes.
Airbnb is the sort of Mac of this market. In many cases people just want to buy a Mac due to the user experience. They absolutely like the product, and they don’t care that another computer will work just as well, they simply want the quality of design and a better experience.”
Germany country manager Gunnar Froh
The European branch of Airbnb is setting out to establish the best customer support experience possible. It has registered a 1-800 number for the German market which is expected to go live within days, and the customer support modus operandi is true to Airbnb’s roots. The German market call center is sitting in the same building as operations and not outsourced to a ‘support farm’. Likewise, Airbnb agents are not measured on how much time they spend on the phone with an individual in order to resolve the issue. Agents are fully briefed, and have a large degree of flexibility when it comes to resolving the conflict. “The first book on excellence in customer support was written about Amazon. We want the next book to be written about Airbnb,” comments Froh.
Further tying into the overall user experience, Froh points to the Facebook integration that went live at the beginning of May this year. “This is just a glimpse of something we’re developing that will come out soon,” says Froh. The Airbnb Social Connections tool allows you to plug the service into your social graph via Facebook Connect, giving you instant access to over 32 million connections between users, providing real-human opinions about a host or property. “Apart from usability, trust is one of the most important issues. Trust that people will actually book, or accept a booking. The social connections established on Facebook are a proxy for the degree of trust that you can have in a person.”
Froh also referenced credit scores in the past, and how they were and are used as a metric when it comes to fiscal responsibility and overall credit worthiness. He says that in today’s sharing economy, perhaps only those with a certain ‘trust score’ would have access to certain items, or that those with a high trust score could be paying different rates with an individual with a low trust score. This score would be calculated in part through Facebook, which is why Airbnb is already collaborating with the Palo Alto based social network in creating a network that transcends the online world and has real value in the physical world.
Airbnb was by no means an overnight success. It launched more than once, and over the course of three years, has begun a massive shift in the way individuals approach traveling. With success comes imitation, and it’s refreshing to see that Airbnb is taking the legal high road, letting clones clone, and imitators imitate, all the while staying true to its roots, and striving to deliver the best possible experience, bar none. And if Froh’s hints at upcoming technological advancements are any indication, Airbnb could be poised to revolutionize the industry. Again.