A Vision for One of Tech’s Most Valuable Startups: The Airbnb Card
A few weeks ago my old NBC colleague, (now former) Airbnb CFO Laurence Tosi, and Airbnb’s CEO Brian Chesky had conflicting visions of where Airbnb is going. Chesky wanted to do something YUGE like start an airline while Tosi appeared to like making customer service boringly efficient and achieving profitability. This dispute may have led Tosi to leave the company efficiently earlier this month.
It’s easy to have opinions, so I’d like to share mine.
So, what’s a BIG vision for Airbnb that isn’t an insane moonshot and isn’t boring? I always thought Experiences was interesting, but it was also very hit or miss — emphasis on the “miss” (for me, at least).
That said, Airbnb is apparently investing $5 million this year to expand Experiences to more cities, so perhaps people like them. But I think Airbnb Experiences is missing out on leveraging the company’s #1 asset: its hosts.
The Airbnb hosts I have appreciated most are those who create personalized experiences, both within the home and outside of it. The last one with whom I stayed offered his fave brands of local craft beers with a little write-up on each, then provided recommendations of where to enjoy them in his neighborhood. I will try to stay at his place every time I am in Chicago.
What if the host was able to make deals with local merchants to recommend their services and both he and his guests were rewarded for it?
Imagine if when I got to my Airbnb house, I fired up the app and there were a list of merchants nearby who accept “The Airbnb Card.” Those that my host recommends would be highlighted. Say I wanted to hit a recommended bar. I’d present my Airbnb card, or more likely use the app, and get a 10% discount. If not a discount, maybe because they know my host sent me, they offer me a special on a pint of a specific beer he recommends. Maybe my host would get a commission on my bill, which he could either take or pass on to me, kind of like a cash-back credit card deal.
These commissions and discounts could be treated like credits, and I could accumulate Airbnb Cash, which I could use anywhere in the Airbnb system.
Airbnb’s local hosts also help solve the last-mile dilemma that crushes so many SMB sales models. Instead of Airbnb paying a huge sales force, hosts could sign up local merchants and get a royalty on future revenue the merchant earns from the Airbnb network. Of course, in many cities I imagine merchants would be eager to sign up on their own to try to get featured, but the hosts’ endorsements would be a critical element.
Airbnb of course would get a small cut of every transaction. And maybe even the float on my bill.
There would be plenty of kinks to work out, and ratings and reviews of merchants would be critical, similar to how host reviews currently work. Because of the trust relationship between hosts and guests, this could become a more powerful local reviews system than services like Yelp or GMB, particularly if Airbnb doesn’t fall prey to trying to turning this into a local ad revenue play.
Airbnb has already created a trusted network. It now merely needs to extend that trust to get local hosts and merchants working together to create great experiences for their mutual customers.
It’s not as exciting as launching an airline, but it’s probably a much bigger opportunity and makes a lot more sense to me for their brand.
The Airbnb Card — You Can’t Leave Home Without It.
*(Full disclosure, I own a very small number of Airbnb shares via an SEO-for-equity deal I did with Nabewise years ago. Thank you, Ann!)
