Uber and Airbnb were both founded around a decade ago and most of us think of them as being synonymous of the gig economy where millions of vendors sell their wares via asset-light platforms who act as a shopfront. However, “As Airbnb prepares to go public next year, its boss, Brian Chesky, has been making the case for his company, both to the press and behind closed doors. He is keen to get across that, sharing-economy heritage notwithstanding, Airbnb is no Uber.”
So, what are the differences between the two platforms? “But here the similarities end, starting with money. Whereas Uber has yet to turn a profit (and, sceptics say, never will), Airbnb says it is already profitable (to be precise, ebitda-positive) and has been since 2017, when it is thought to have earned $93m on revenues of $2.6bn. That is not the only distinction.
For ride-hailing firms like Uber and Lyft, supply and demand must be matched in the same city; a driver in Manhattan is no use to a rider in Mumbai. Airbnb’s listings, by contrast, are global. Any property anywhere can potentially appeal to any user; a Mumbaiker may want to stay in New York. A telltale sign of Airbnb’s superior “network effects” is that whereas drivers for Uber often drive for Lyft, and vice versa, doing their utmost to play the platforms off against each other, most of Airbnb’s listings do not appear on any other platform.”
Thirdly, Airbnb has been cleverer than Uber in the way it has dealt with regulators around the world. “Airbnb decided earlier than Uber to work with regulators rather than fighting them. It has struck deals in more than 500 big cities around the world. It says it has collected more than $1bn in hotel and tourism taxes in America alone and is “on track to become the world’s largest single collector of these taxes”.
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