Monthly Archives: July 2015

Value of .01% Stake in Airbnb?

MoneySo, just thinking out loud here, what is the value of a .01% stake in Airbnb? What a great question to ponder, let’s do the math.

According to the Wall Street Journal and CNN, Airbnb currently today July 11, 2015, has a valuation of $25 Billion USD.

So let me get out my calculator while I calculate .01% stake of $25 Billion dollars, wait, that won’t work, my calculator won’t fit in that many zeros.

Computer calculator puts it as follows: $25,000,000,000 X .0001 = $2,500,000.

A cool $2.5 Million USD. That would be nice eh?

While Free-Rentals is hardly Airbnb (yet), we were in this holiday rental industry years before they arrived to the scene. We are now seeking founding partners to help us gain a half million rental unit listing momentum, and we are giving out 0.01% blocks of stock equity in Free-Rentals to our members who help us make that happen.

Married Couple Retires to Airbnb

afarAfar Magazine does a Q&A session with a married couple that decided to spend their retirement by bouncing around from one Airbnb home to the next. They have already rented 55 Airbnb rooms in over 30 countries, and are continuing their journey.

“Turns out it was! So we got rid of most of our stuff, rented out our Seattle house, reduced our monthly expenses, and bought two one-way tickets to Paris. And we’ve been traveling ever since.”

Afar Magazine also provides a list of tips and techniques for maximizing travel when you hit retirement age.

How To Choose A Vacation Rental Service

otaloThere are literally thousands of vacation rental listing websites to choose from online either when seeking accommodations or having a room you want to rent out short term. But which of these websites is best for you to use as a guest? which is best to list your room as a host?

Aggregate directory of vacation rental listings Otalo has as excellent comprehensive overview of most of the top vacation rental websites, and facts and stats about each.

Holiday Rentals Search Engines

hometogoA new player has come to the seen with a metadata search engine for the holiday rental industry. They are a Berlin based start-up called HomeToGo.de, and they just raised €6 million in Series A funding from DN capital and Acton Capital Partners, which is in addition to the €2 million previously raised from various angel investors.

HomeToGo claims to be the biggest metasearch engine for holiday rentals, aggregating from over 150 rental websites and listing more than 2.7 million vacation rental units. But they have existing completion from tripping.com with 2.5 million units, otalo.com with 1.8m units, and vast.com with 416,000 units.

Airbnb Regulation Movement in San Francisco

Photo by Gabrielle Lurie - sf.airbnb -Coalition members call for city officials to immediately begin efforts to collect more than $25 million in past due taxes owed by Airbnb at a press conference on Monday, November 24, 2014, at the global headquarters of Airbnb in San Francisco.

Photo by Gabrielle Lurie – sf.airbnb -Coalition members call for city officials to immediately begin efforts to collect more than $25 million in past due taxes owed by Airbnb at a press conference on Monday, November 24, 2014, at the global headquarters of Airbnb in San Francisco.

And so it begins, another movement is underway in San Francisco to regulate Airbnb’s short term accommodations sharing program. A coalition of affordable housing activists and local home owners are battling an Airbnb backed group called “San Francisco for Everyone” over a ballot initiative aimed at curbing Airbnb’s growth of room sharing within the city.

According to TechCrunch:

Backers of the ballot initiative say the existing regulation passed last fall doesn’t go far enough, and neither will changes proposed by Mayor Ed Lee and Supervisor Mark Farrell. The initiative proposes a law with a 75-day limit on hosting, quarterly data reports from platforms and an ability to go to civil court if the planning department does not react to complaints in time. Last week, Lee ordered the creation of a new enforcement office just as the city also sent violation letters to 15 hosts for allegedly turning 73 housing units into full-time short-term rentals. Lee and Farrell are trying to strengthen a short-term rental laws passed last year by putting a 120-day limit on the number of nights a host can rent out their home.

According to the San Francisco Examiner:

Supervisor David Campos wants a 60-day cap on the number of stays a host can book per year. Mayor Ed Lee and Supervisor Mark Farrell want a 120-day cap.But that’s hardly the end of the debate. Campos argues the only way to enforce a cap of any size, is to require hosting platforms like Airbnb to only allow listings on their sites with a valid city registration number — or face penalties. And he wants those websites to provide quarterly booking data.

Regardless how the standoff shifts, it seems two factors are a stake; how many days maximum can home sharing be allowed? And how is this measured and enforced? We will continue to monitor this story closely as it unfolds.

Comparison of Vacation Rental Sites

Here is a list of worldwide vacation rental websites and the fees and commissions they charge.

Website Guest Fee Host Fee Listing Fee
Airbnb.com 6 – 12% 3% Free
Clickstay.com 0% 10% $1
FlipKey.com (TripAdvisor) 0% – 10% 3% $0 – $299
     VacationHomeRentals.com
Free-Rentals.com Free Free Free
HouseTrip.com ?? 10% – 20% Free
PerfectPlaces 0% 0% $119.95
Rentals365.com 0% 0% $148 – $248
Roomorama 8 – 12% 0% Free
Tripping.com 10% 3% Free
HomeAway.com 0% 0 – 2.5% $349 – $999
    VRBO
    VacationRentals.com
    Homelidays
    Abritel
    Toprural
    Bookaback
    Stayz
    Travelmob
Welcome-Worldwide.com 0% 0% $98
Wimdu 12% 3% Free

Best Vacation Rental Photo Contest

We are seeking the TOP 20 most stunning vacation rental listings to feature on our homepage for the remainder of 2015. Properties with the best photographs will be selected. Absolutely FREE promotion and advertising of your vacation rental property. Sign up between now and July 31 to enter the competition. To Enter, all you need to do is LIST YOUR PROPERTY FOR FREE!

Airbnb’s Valuation

imagesAirbnb is now valued at just over $25 billion dollars, which makes it more valuable than the hotel giant Marriott International, which has more than 4,087 physical properties in over 80 countries and territories around the world, and over 697,000 rooms (as of July 2014), and an additional 195,000 rooms in development, with a $21 billion dollar valuation.

CNN is calling it “crazy money“. Why? not just because they don’t own any physical buildings or rooms used for renting and sharing, but also because they lost over $150 million last year and are estimated to lose $200 million more in 2015, according to PrivCo.

According to The Wallstreet Journal;

Airbnb’s value would also eclipse that of rival travel site Expedia Inc. EXPE -0.11 % by nearly two times. Airbnb arguably commands a premium valuation due to its higher growth rate—roughly 90% projected over the past two years compared with 17% expected for Expedia, which analysts expect will have $6.5 billion of revenue this year. On the other hand, Expedia’s business makes money. Analysts forecast it will have earnings before interest, taxes, depreciation and amortization of $1.1 billion this year.

The current leader in hospitality, Priceline, has a market value of about $61 billion, and expects to generate $9 billion in revenue this year, according to analyst estimates, about 10 times Airbnb’s projection. Priceline’s expected Ebitda for the year is $3.6 billion.

The article goes on to say:

Airbnb generates revenue by taking a 3% cut of each booking along with a 6% to 12% service fee from Guests. To meet its lofty revenue targets, Airbnb would need to increase its share of the global lodging market from 1% to as much as 10% over the next five years, according to Douglas Quinby, an analyst with research firm Phocuswright.

So where is this all heading? It will be interesting to see what lies in store for Airbnb given its ambitious growth plans and its current valuation making it worth a whopping $24,000 USD for each of the 1 million property and room listings on their website.