Please ensure Javascript is enabled for purposes of website accessibility
Airbnb for X


Published January 23, 2020

Written By Brad Wisler

Brad Wisler is the Co-founder and CEO of Periodic. He is a long-time entrepreneur and investor with decades of experience in SaaS and online transactions.

Marketplaces like Airbnb rely on liquidity in supply and demand to be relevant. They understood from the early days there must be ample providers (read: air-conditioned tree forts) and buyers aware of these high-quality/ludicrous options. While the rest of us might have been debating the chicken-and-egg dilemma, Airbnb was cooking omelettes with gas. Here’s how:

If you build it they will come

VCs and experienced entrepreneurs will tell you this is the fastest way to go broke. But I’m siding with schizophrenic Iowa corn farmers when it comes to online marketplaces. Airbnb charges an infinitesimal 3% hosting fee compared to 6% booking fee, helping turbo-boost marketplace listings and traffic. 3 reasons why this matters:

1. Airbnb understood it needed a lot of listings to get consumer traffic and conversions.
2. Airbnb recognized making your home available to strangers is not exactly stress-free. Incentivizing hosts with lower fees was the best way to alleviate those concerns.
3. Consumers are used to paying booking fees at hotels, a precedence for the 6% booking fee.

Building a successful marketplace starts with looking at existing expectations for buyers and providers in your marketplace-vertical, leveraging those for competitive advantages, and executing your vision.

Limit User Churn / Be So Good They Won’t Leave You

Online marketplaces depending on transactional revenue risk losing repeat business because of users skirting the system to avoid its fees. Airbnb hosts are unlikely to do under the table deals for a couple reasons. Let’s explore:

1. A million dollar Host Guarantee gives providers peace of mind.
2. Airbnb hosts don’t have to worry about not getting paid. The platform protects hosts from cancellations and bad credit cards.
3. Fast, convenient booking: Airbnb makes it incredibly easy for hosts to manage availability of their spaces, even integrating with competing platforms and calendars.

Airbnb identified the most time-consuming and stressful aspects of property rentals, and made them go away like a Motel 6 in Hilton Head. While not everyone has a Horowitz war chest, economical platforms exist to help startups offer premium user experiences, even in the bootstrapped early days.

The Art of Hustling and Automation

Airbnb embodies many entrepreneurial cliches, but perhaps none more so than “Do Things That Don’t Scale.” For starters, Airbnb used to create dozens of Gmail addresses to spam property renters on Craigslist. Then they built a script to automatically post listings to Craigslist– something that violated Craigslist’s user policy and has since been made impossible. Finally, they realized high-quality photos of listings would increase user interest, so they hired professional photographers to take beautiful wide-angle shots for hosts.

All of this hustling was balanced with automating tedious tasks. Booking rooms had the potential to hold up deals so Airbnb built a booking system that reflected real-time availability of properties. After time they enabled guests to instantly book listings, provided hosts enabled this feature.

Airbnb beautifully combined hustling efforts with smart platform experiences to grab the unicorn tag.

You Can Execute with Periodic

Periodic is the most advanced real-time booking engine with all of the features you need to build the next Airbnb. Get started today by launching a booking system.