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Airbnb revises business model

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Airbnb revises business model
May 06
13:00 2020

Airbnb is a very famous and popular short-term rental service. The company was founded about 12 years ago in American San Francisco. The unique service is essentially an aggregator that allows tourists to book accommodation directly from the owners. The company earns by charging a commission from both owners and tenants. The service quickly gained popularity around the world; at the moment, Airbnb services can be used in 100 thousand cities around the world.

Times have changed a booking service Airbnb has faced a huge crisis. Company’s CEO Brian Chesky has told the reporters that they are going to cut about 25% of the company’s staff. About 1900 employees will lose their jobs. In order to survive the difficult times, the company will also have to reduce investment in third-party projects.

Mr. Chesky notes that the current crisis is the worst he has ever faced. The service manager says that the revenue for 2020 is unlikely to be even half of that recorded in 2019.

Airbnb management has already tried to deal with a difficult situation: representatives of the top management will get 50% of their salaries for half a year. Brian Chesky has refused to get salary at all.

The company’s CEO predicts that the “travel style” after the end of the pandemics will change dramatically. Chesky believes that only housing that is cheaper and closer to home will enjoy popularity. It is not yet clear if the businessman is right and how the company’s strategy will change.

 

The material was prepared with the participation of Katya Wilson,
a leading analyst of the brokerage company UFT Group

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