Airbnbillions
Airbnb just booked its first annual profit in its near-15-year history, minting a whopping $1.9bn in 2022.
It may come as a surprise to some — particularly those who see the platform as a home for sneaky add-on charges — but, last year aside, Airbnb has lost nearly $6bn since 2015.
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Since it was founded in 2008, Airbnb has altered the world of travel as we know it, for better or worse. It’s opened up worlds of opportunity to hosts and holidaymakers through short-term lodgings and experience offerings.
Its business model was the archetypal Silicon Valley strategy (excluding the bit where they sold cereal to stay afloat). Airbnb grew at blitz speed, burned money, and tried to get to “scale” as quickly as possible. That model, of course, doesn’t always work: Quibi, Jawbone, WeWork — the list of companies that raised $10m, $100m or $500m+ before failing is very, very long.
And even in the last few years, it wasn’t obvious if Airbnb’s model was sustainable. In 2019, when it logged more bookings (327m) than ever before, the company still lost a cool $700m+ over the year. When the pandemic struck in 2020, Airbnb’s first year as a public company, the platform was badly hit as fewer bookings and stock compensation expenses combined to cost the business $4.6bn.
However, Airbnb now appears to be in rarefied air, with its place as the de facto online marketplace for homestays and experiences giving it a network effect that’s hard to compete with. Travelers will go to the platforms where they have the most choice, and hosts will want the widest possible reach.
