The Brilliance of Airbnb’s Model — and a Timely Warning
By Isaac French
Yesterday, I listened to a podcast from my friend Zach. He interviewed an Airbnb Superhost named Elam King with nearly 10,000 reviews and a great track record.
A couple months ago, without any prior warning, Airbnb permanently banned him from the platform. His entire account: over six figures in bookings! Just like that, his livelihood was gone.
A lot of you know my own story, but for those of you who are newer here, I’ll briefly summarize:
Two weeks after we opened Live Oak Lake, with both bookings and extremely positive reviews rolling in, my entire account was suspended. And just like Elam, I received not a single warning or communication from Airbnb. I simply noticed no bookings had come in one day and logged into our account.
This is what I saw:
I was confused. And frustrated.
I called Airbnb support multiple times, waited through countless holds, relayed my situation with countless reps, and got the same answers: “We’re sorry, our security department is reviewing your account. We have no indication of how long this may last.”
Thankfully, my account was fully restored just 5 days later.
As I’ve often said, this incident ended up being one of the most fortuitous blessings we experienced along the journey of building and owning Live Oak Lake.
Why? It lit a raging fire under my feet, and in my belly, and everywhere to figure out social media. Within three days, we did our first influencer giveaway partnership which resulted in ~$40k in direct bookings and our first ~5k followers on Instagram.
Oh, the highs and lows of running a business:)
I thank God that lesson was learned and the adjustments were made in our booking and marketing strategy early on. Because eight months later, in September 2022, it happened all over again.
That second time was even more frustrating because Airbnb support insisted that the resolution to the suspension was waiting on an email they had sent to me that I had to confirm and respond to. Guess what? I NEVER RECEIVED A SINGLE EMAIL.
Thankfully, I had a bit of a following on social media by then, as well as some valuable connections that were employed at Airbnb, and after 12 days, the suspension was revoked. But those 12 days were harrowing.
These incidents, and plenty of others I found out about after sharing mine publicly, are unacceptable. But I don’t say any of that to disparage Airbnb—I’m just telling the truth for what it is. I do wish somebody who matters would read this and do something about it to help save the platform’s reputation with hosts.
I actually madly admire the company, and especially its leader, Brian Chesky. He’s absolutely brilliant. And this brings me to the positive about Airbnb: they totally revolutionized the accommodations space by empowering individuals with few resources to become hosts, and even boutique hoteliers.
Airbnb tapped into — and provided a platform for — the entrepreneurial instincts of hosts.
And the immediate feedback loop of the platform allowed those hosts to continuously improve their hosting, and thus attract more business and better reviews. It’s a beautiful model and flywheel, and one unheard of in the hotel industry.
So this is a big part of what the company did right, and did way better than any other OTA.
But the smart hosts who outperform through operational consistency and efficiency, and most importantly through providing a truly one-of-a-kind, transformative and captivating experience for their guests, will inevitably de-risk their businesses, unlock 15%+ margins, and essentially own their customers by creating their own direct booking machines.
Plenty have already done this, but the opportunity is still huge. And it’s not just for hosts.
There’s opportunity for software developers to create better direct booking website templates with the necessary functionality of calendars and multi-unit search, PMS integration, etc. There’s opportunity for more content creators and strategists that understand how to make viral videos to grow an instagram audience. There’s opportunity for better revenue management services.
So much opportunity.
It’s a great time to be all-in on developing, running and owning one-of-a-kind stays, and building durable brands around them to drive direct bookings and lifetime relationships with guests.
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Let’s go!!
—Isaac