Airbnb raises $112 million
The economy isn't immobilizing everyone.
Airbnb, the "access economy" standout that allows everyday people to rent out their homes while they're away, this week announced it raked in $112 million in investment, based on a valuation that places it firmly in what giddy media are calling the "billion dollar club."
The recent round was led by Andreessen-Horowitz and included money from Digital Sky Technologies and General Capitalist.
Launched in 2008 by Rhode Island School of Design graduates Brian Chesky and Joe Gebbia, San Francisco-based Airbnb claims to have over 100,000 hosts, well over 2 million nights booked, and service in over 181 countries and 13,000 cities -- demonstrating a clear tipping point in the collaborative consumption business model.
Not bad for a company launched after founders Chesky and Gebbia rented out their San Francisco apartment, decked out with airbeds and including a morning meal, during a San Francisco design conference a few years back. Airbnb had previously raised $7.2 million from Greylock Partners, Sequoia Capital, Ron Conway's SV Angel, and adorable celebrity investor Ashton Kutcher. This time, serious buzz surrounded its valuation of an estimated $1.3 billion.
The company says it will use the funds to expand into global markets, including Europe and South America. And that can't come fast enough.
Like other companies racing into the access economy space, the Airbnb model has already been copied by startups including Germany-based 9flats, which snagged investment from Silicon Valley's Redpoint Ventures, and Wimdu, which closed a massive $90 million investment round from European investors that specialize in cloning promising tech companies. Wimdu has grown at a brisk cllp and this spring launched a Chinese subsidiary, Airizu.
One Airbnb user recently raised a stink about having her home methodically robbed and trashed during the week she rented her home through the service. Walls were cut through to get to locked values, and all the while the renter sent cheerful emails to the host, according to a TechCrunch blog. The incident highlights expected wrinkles in the company's evolving model, namely a policy of not letting hosts know who they're renting to until the 11th hour.
After being criticized for its tepid response, Airbnb's Chesky told TechCrunch they would "go above and beyond" to bail out the distraught woman, and he also posted a blog responding to the incident.