Airbnb becomes a full-service travel company worth $30 billion
San Francisco,Nov19:Airbnb has finally launched a feature that will help transition the company from a website for booking lodgings to a full-service travel company.
On Thursday, the company announced it’s launching Trips, a feature that was hinted at for months but has actually been in the works for two years under CEO Brian Chesky.
According to a new article by Vanity Fair’s Katrina Brooker, Chesky pulled away from day-to-day operations two years ago to create the feature that would launch the next stage of Airbnb.
Trips offers two services for now: Experiences, like going truffle hunting or driving classic cars, which are led by locals, and Places, which are recommendations from local residents.
For Experiences, Airbnb brokers the payment from the user to the guide and takes a cut, similar to how its home-booking service works. For Places, the company has some revenue-sharing deals in place, like a partnership with Resy to book restaurant reservations.
The company plans to add Flights and Services in the near future.
Trips now shows up in the Airbnb app, but the ability to browse and book experiences is available in only 12 cities: Los Angeles, San Francisco, Miami, Detroit, Havana, London, Paris, Florence, Nairobi, Cape Town, Tokyo, and Seoul. There will also be 100 “Insider Guidebooks” available in six cities at launch.
The update was unveiled Thursday at the company’s Airbnb Open conference, but it’s been widely speculated about since last year — and was even briefly published as a standalone app. Airbnb began piloting Trips in San Francisco last December, offering guides created by Airbnb hosts for guests.
In June, Airbnb raised $1 billion in debt financing to help expand and develop new add-on travel services. The company has tested art gallery tours, personal chefs, and bicycle rentals, which customers have been able to book when they rent a home or reserve a room through Airbnb.
The addition of travel guide features in the app are a shift for Airbnb toward becoming a travel company rather than a hotel competitor, which would help it secure a steadier revenue stream — or at least one less subject to strict regulation and competition from powerful lobbies.
Airbnb is forecasted to book $12.3 billion in rentals this year, Cowen & Co. estimates. Since the company makes as much as 15% off each listing — between 6% and 12% from guests and 3% from hosts — Airbnb may be making as much as $1.85 billion in revenue in 2016.
The company was valued at $30 billion as of September after raising $555 million of a planned $850 million Series F round.