Following the announcement of Airbnb’s imminent IPO, Eugene Tavyev, CEO and founder of Spacepool, looks at Airbnb’s key ingredients of success, what new businesses can learn from them and highlights opportunities that remain for disruptive tech platforms.
It’s hard to imagine a time before Airbnb and Uber, now as ingrained in our society as the mobile phones we use to access them. In the decade since their launch, more and more asset sharing platforms have been working hard to disrupt how people rent items or book activities. Deliveroo, Rightmove and Treatwell have made accessing goods and services as easy as a few taps, bringing the supplier to the consumer, rather than the other way around.
Allowing customers to liaise with the owners or operators directly, many have a similar business model to Airbnb. In such a busy space, what sets one platform apart from its competitors, and how does one truly disrupt?
To say Airbnb has flourished is an understatement; it’s grown from nothing into a $30bn firm in just 11 years, with over seven million listings in more than 100,000 cities around the world, leading to over $100 billion in economic impact across 30 countries. Its IPO is one of the most hotly anticipated of 2020 and is one of the last of the unicorn herd set up in the last decade – a herd which includes The We Company and Post Mates – to do so.
Online mattress start-up Casper, launched in 2014, is now a billion-dollar company using digital hype through influencers to attract investment. And, fuelled by the growth of online-only retailers attempting to carve a niche for themselves, it’s working: its founders expected to sell $1.8m in their first year, but hit the number in just two months.
While not a traditional tech firm, revolutionary fitness platform Peloton is a digital phenomenon with over a million users, making it much more than exercise equipment, but a self-proclaimed way of life. One of its key USPs is the personal connectivity between users, from getting a shout out or a high five during a workout to the social media outside of it: breaking that fourth wall is bringing together a new community fully engaged in the offering.
Both companies are suspected to be planning an IPO in the coming months, though neither have confirmed. It’s not difficult to see why they are keeping their cards close to their chest though, when even sure-fire successes such as WeWork have cancelled their IPO plans after significant concerns from investors about the company’s business model and corporate governance.
The success of both Casper and particularly Peloton can be attributed to their approach: engaging with their audiences directly and cutting out the middleman like a mattress warehouse or a gym means users can reach a conclusion far quicker. Circling back, Airbnb enables suppliers of properties to connect directly with customers, a fundamental benefit of a tech-based business, which can be monetised effectively.
For guests, by positioning itself as a travel experience platform, rather than as an accommodation booking engine, Airbnb was able to connect with a previously under-serviced segment of the travel market.
Hosts, on the other hand, enjoy Airbnb’s simplicity; anyone has the ability to list an extra room or entire property on its website, liaise directly with the guests, and invoice through its platform. It focuses on user experience and has built a hugely successful business from understanding its customer’s needs and providing products to meet these.
This business model is often looked up to by start-ups of a similar sphere, and with good reason. Search “The Airbnb of…” anything online and at least five companies claiming to be that disruptor of its sector appear, from boats to storage and even food. Airbnb is a true disruptor and its key principles can be applied to other all classes such as offices.
Much like Uber has caused a shakeup of the taxi industry, Airbnb has disrupted the hospitality industry and prompted hotels to review their business models. Branded hotels are now offering products targeted to specific markets such as extended-stay accommodation for those looking for a home away from home and budget accommodation for travellers on a tight budget who still appreciate a certain level of comfort.
Airbnb has significantly altered the nature of the short-term property rental market and has revolutionised the travel industry. It is emulated on every level from the business model to the website’s design.
At Spacepool, we spotted a gap in the flexible office space sector. By developing an interactive and intuitive platform, we are facilitating direct contact between workspace providers and those looking for a space. Businesses can access hosts and liaise directly, and with no agents involved, which puts users in control. Workspace providers have the option of creating bespoke leases with its clients and can curate the right mix of occupiers in its spaces. Much like Airbnb, searches can be filtered in a number of ways to find the most suitable workspace, and hosts can reduce admin and invoice through the platform too.
Disruption tends to suffer from its reputation of being a negative influence. The reality is it doesn’t have to be – it all comes down to its impact and whether that is positive and creating more opportunities and room for creativity. Airbnb has already shaped so much of the way we search for products and places and, no doubt, will continue to be the springboard for many a start-up brainstorm or design meeting for years yet.
Regardless of sector, the common link between any real estate asset class is the need for businesses and its people to have a sense of belonging and community, and that’s where these platforms prove to be a vital hub. Technology is not replacing humans but facilitating greater interaction, communication and collaboration and this is the culture and spirit that ensures disruption is a long-term success.
Image: depositphotos.com
