Airbnb is profitable in the way that running an illegal, unlicensed anything in a highly-regulated market is profitable. Running a casino or liquor store in you

Airbnb is profitable in the way that running an illegal, unlicensed anything in a highly-regulated market is profitable. Running a casino or liquor store in your basement is also very profitable, because you can tap into a supply-constrained market with none of the cost of regulatory compliance faced by your competitors, while offloading the social costs of your business on the public. There are some 'real' Airbnbs - people renting out a room in their primary residence, or the whole place for a few weeks a year while they're away. I slept on an expat's floor in Yangon for $10 once (via Airbnb). And that is real value creation. Sometimes it's just a good discovery mechanism for legitimate vacation rentals (like beachfront homes in resort developments in Hawaii). But 90+% of it is illegal hostels and hotels in apartments or homes removed from the long-term rental market where the 'value' is just not having to pay taxes, meet fire code or respect restrictions on where hotels can be built.