Silicon Valley

Air Bed and Breakfast, the new player in the travel space

Sounds like the right time to post the article that I had started to work on about Air Bed and Breakfast when I met the founders three weeks ago: they are making the headlines of Techcrunch today here.

Not that I feel like competing with Techcrunch much, but I thought I might share with you a little more background on this start-up that is considered as one of the most successful of Y-Combinator, and that Techcrunch  describes as the ‘ eBay-like marketplace for all accommodations’ .

Air Bed and Breakfast has been founded in August 2008 and, guess what? They are already CF positive. Entirely boostrapped, they are growing at the enviable rate of 50%/month, and they have had tremendous user traction so far…

The site matches travellers with individuals renting their couches, apartments or homes. Couple of figures that tell everything about the success of the concept, especially in the middle of this economical crisis when travellers are looking to save any dollar they can:

- 680 cities covered in 71 different countries

- ‘2500 listings and close to 10,000 registered users’ (and not a trace of PR work in there: all word of mouth!)

- individuals that rent their place can make up to $500/week…travellers pay in average $20/night, everybody wins!

What is the business model of the start-up?

For each rental, AirBnB takes a 7 to 10 percent cut of the traveler’s payment (as the rental price of the accommodation goes up, AirBnB will take less of a cut) and also takes a flat 3 percent cut of what the seller receives.

Right now, Air Bed and Breakfast (which team makes a point in picking themselves the eligible individuals that post on their site by visiting the places and taking the pictures to assure quality) is big in NYC -400 listings- and San Francisco..and they are planning on putting an emphasis in Europe soon…I will wait for them in Paris!

Last month has been all about the travel space for me:I have had the chance to meet with the french founder of VoyagePrive.com, Denis Philippon, who came to the US to explore opportunities and get a feel of the travel space in the US..An overall VERY VERY crowed space where his concept has not been explored yet: private travel sales. Voyage Prive just launched in Spain and Italy, and reached this year 3 million customers, €2 million profit and follows a nice growing curve..

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