Question

explain AirBnb company revenue model 2019 with numbers

Answer 1

Airbnb is a private, global company that offers an online marketplace platform for hospitality services. Airbnb is accessible through its official website or by an app. Members of Airbnb can use the platform to arrange or offer to lodge for home stays or tourism experiences.

It utilises a Aggregator Business Model, like Uber or the Indian company Oyo Rooms. It does not have a linear business model like the traditional hotel chains such as Marriott, Hilton etc. The traditional hotel businesses have to invest millions in building and maintaining their properties.

The property owners are provided free listings by Airbnb and the travelers then browse the various properties in a particular location as per their requirements and budget. The booking and monetary transactions are carried out on the Airbnb platform.

Airbnb’s platform is designed for individuals that are private owners of any listed properties with the current property count of 6,370,563 listings across 191 countries and over 2 million individuals use the Airbnb to gain access to leasing, rental property insights.

They makes a commission from every booking that is completed. There are approx. 28,571,438 bookings a year, which is approx. 23,810 booking per month. The company gets its share of revenue from these transactions through two sources:

1. Commission from Hosts/Owners

Airbnb deducts a flat 10% commission from hosts for every booking done through the platform. Hosts also have to pay a 3% fee for the processing of the payments of the guests.

2. Transaction fee from Travelers/Guests

6-12% of the booking amount is set as service fee by Airbnb for travelers for every confirmed booking. This fee is non-refundable.

Airbnb has been enormously successful, with around 150 million users and impressive global statistics that, as of August 2019, include a gross revenue of $4,308,726,681, year-on-year growth of 21%.