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Airbnb Prepares for December’s IPO with a Focus on Design and Diversification

Much to everyone’s surprise, Airbnb has not been as decimated by the pandemic as you may expect. In July the company reported that customers had booked over 1 million nights in a single day, for the first time since March 3. This could in part be thanks to its willingness to diversify and grow. To be the best, it surrounds itself with people at the top of their game and the latest high-flier to collaborate is Jony Ive, ex chief of design at Apple. 

Back in 2009, Airbnb was failing to grow. Its co-founder, Joe Gebbia, came to the realisation that all the listings looked similar, the photos were not great, and the product simply wasn’t selling itself.

Attempting to fix this glaring problem, he and two colleagues went directly to some of their customers’ homes and spent time taking professional images that really showcased the homes in their best light. This was a turning point. Within a week, they’d doubled company revenue and knew they’d stumbled upon something important.

Image taken from Smithsonian Magazine. Photograph of Jony Ive, by Brian Bowen Smith

It seems this focus on design may be the reason Airbnb has now appointed design firm LoveFrom.

One of the designers who Joe and I have most admired is Jony Ive, the former Chief Design Officer at Apple. Over a year ago, Jony formed a new company called LoveFrom as a collection of creatives that include designers, architects, musicians, writers, engineers, and artists.”

– Airbnb Co-founder and CEO Brian Chesky.

One of the key reasons for Apple’s incredible and sustained success is its elegant and simple design. Jony Ive takes the credit as he changed the look and feel of electronics forever. It seems Airbnb wants to capture this creative aesthetic and harness it within its own future offerings.

From the design of our original business model, to our system of trust, to the creation of new products and offerings, we approach many of our decisions as design problems.

– Airbnb Co-founder and CEO Brian Chesky.

With both founders Chesky and Gebbia, being deeply passionate about design, there is a valid reason for their choice of partnership, but is it overindulgence in what is essentially a product listing site? Well, perhaps this hints that there may be more to the future of Airbnb than simply a glorified classified ads site. In fact, maybe Jony Ive could help Airbnb push into different revenue generating avenues.                                                             

At first Airbnb improved tourism, boosted coffers, and appeared to be a win-win for all involved. But sadly, this quickly turned dark as individuals and developers started buying up buildings in prime locations purely to list them on Airbnb and generate a second income, with little care for anything but cash. The story was the same in countless cities all over the world. Airbnb has a stranglehold on local properties, thus depriving citizens of being able to buy properties to live in. Complaints were coming thick and fast as citizens complained of parties, mess, destruction, overcrowding, traffic congestion and an array of local problems ultimately caused by the rise of Airbnb.

Image taken from Airbnb Website

Diversification led design

So, to combat this and keep consumers happy, it makes sense for Airbnb to buy or build its own properties in the most popular locations. Or to diversify further and develop additional tourism-related ventures that solve problems and look too good to resist.

Airbnb has already begun dipping its toes in diversification. It has been looking at ways to take ownership of some of its properties, by custom building units specifically for short-term stays.

Four years ago, it launched Airbnb Experiences, which is a selection of one-of-a-kind activities designed and hosted by locals. It adapted this in response to the pandemic by offering online experiences in 2020. This includes activities such as ‘Go On a Leopard Safari in Sri Lanka’, where (from the comfort of your home), you meet online with the Sri Lankan host, to listen to leopard stories and identify individual leopards. Many other activities are available such as a family magic show, baking and cookery classes, art classes and holiday sign language games.

Food Experience, Chiang Mai – Image taken from Airbnb Website

With education slipping in recent months and many extracurricular activities cancelled, these one-to-one sessions could bring a brand-new kind of education to the fore, connecting people in new ways.

After much speculation, Airbnb now hopes to raise around $3 billion in its December IPO. It has ambition and drive, but with the pandemic and US election casting a shadow over the global economy, time will tell if it can realise its dreams.

It’s not just about being on a campaign trail to get the IPO completed, Airbnb wants to give investors a reason to be excited about the future of the company. With Apple’s design guru on board and diversification a top priority, it seems there’s plenty to look forward to.

Valuethemarkets.com, Digitonic Ltd (and our owners, directors, officers, managers, employees, affiliates, agents and assigns) are not responsible for the content or accuracy of this article. The information included in this article is based solely on information provided by the company or companies mentioned above.

This article does not provide any financial advice and is not a recommendation to deal in any securities or product. Investments may fall in value and an investor may lose some or all of their investment. Past performance is not an indicator of future performance.

  • Patricia Miller does not hold any position in the stock(s) and/or financial instrument(s) mentioned in the above article.
  • Patricia Miller has not been paid to produce this piece by the company or companies mentioned above.
  • Digitonic Ltd, the owner of ValueTheMarkets.com, has not been paid for the production of this piece by the company or companies mentioned above.

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