Airbnb generated $1.9 billion in profits in 2022. 2022 was the first profitable year for Airbnb since 2018. As the pandemic hit, the company reached the bottom in net losses in 2020, and Airbnb reported back then net losses for almost $4.6 billion in net losses.
Airbnb Business Model | Description |
Value Model: Expanding the hospitality industry at scale. | Airbnb’s mission is to “create a world where people can belong through healthy travel that is local, authentic, diverse, inclusive, and sustainable.” A peer-to-peer platform enables hosts to easily list and monetize their real estate and guests to find alternative locations across the world. Airbnb created a whole new category for travel, expanding the industry and making it viable at scale. |
Technological Model: Peer-to-peer platform. Two-sided network effects. | As a peer-to-peer platform, Airbnb enjoys two-sided network effects. The more hosts join the platform, the more it becomes valuable to guests, who can find alternative locations at various price points, depending on their experience. On the other hand, the more the community of guests is thriving, the more hosts are incentivized to invest back in their locations, making Airbnb the go-to location for travel worldwide. |
Distribution Model: Brand, Growth Engine, Continous Improvement, Community Building. | Airbnb has built a strong brand over the years, thanks to its seamless platform and support to hosts. The company’s main growth asset is the community of guests and hosts that interact, making the whole platform thrive long-term. In addition, the platform is fast in releasing new features, testing them out, and trying to figure out new ways for hosts and guests to connect (as Airbnb shows throughout the pandemic). |
Financial Model: Platform Tax. | Airbnb makes money by charging a service fee on top of each booking. Thus making money as more bookings go through it repeatedly. In 2021, Airbnb generated $5.99 billion in service fees. |
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