E Is Airbnb Your Next Ten Bagger?

I was not surprised to hear that the home sharing app, Airbnb, was given a $30 billion valuation in the latest venture capital funding round.

The big question for you and me is: Will the valuation soar tenfold to $300 billion, and how much of a piece of that will you and I be allowed to get?

To answer that question I just spent six weeks traveling around Europe as an Airbnb customer. This enabled me to understand their business model, their strengths and weaknesses, and analyze their long term potential.

As a customer, the value you receive is nothing less than amazing.

I have been a five star hotel client for most of my life, with someone else picking up the tab much of the time, so I have a pretty good idea on the true value of accommodations.

What you get from Airbnb is nothing less than spectacular. You get three or four times the space for one-third the price.

The standards are often five-star and at the top end, depending on how much you spend. I found I could often get an entire three-bedroom house for the price of a single hotel room, with a better location.

Or, I could get an excellent abode in rural settings, where none other was to be had, whatsoever.

That’s a big deal for someone like me who spends so much of the year on the road.

You also get a new best friend in every city you visit.

On most occasions the host greeted me on the doorsteps with the keys, and then introduced me to the mysteries of European kitchen appliances, heating, and air conditioning.

Pre stocking the refrigerator with fresh milk, coffee, tea, and jam seems to be a tradition the hosts pick up in their Airbnb orientation course.

One in Waterford, Ireland even left me a bottle of wine, plenty of beer, and a frozen pizza. She read my mind. Thanks, Mary!

They then took me on a one-hour tour of their city, divulging secrets about their favorite restaurants, city sights, and nightspots. Every one proved golden.

After you check out, Airbnb asks you to review the accommodation. These can be incredibly valuable in deciding your next pick.

I had one near miss with what I thought was a great deal in London, until I read, “The entire place reeks of Indian cooking.”

Similarly, the hosts rate you as a guest. One hostess shared a story about picking up her clients from town after they got drunk and lost in the middle of the night. Then they threw up in the back of the car on the way home.

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Fred Fuld 2 years ago Contributor's comment

I enjoyed the article. It has given me the incentive to actually try #AirBNB.