7 ms·

Airbnb reportedly lays off contractors and cancels summer internships

65 points by stu2b50 7y ago

ProAm 7y ago
Layoffs coming after quarterly earnings.
- iampims 7y ago
  Airbnb is not a public company, which quarterly earnings are you thinking of?
  - paulcole 7y ago
    I think that comment is just from a bot that picks from an HN Greatest Hits API to farm karma?
  - ProAm 7y ago
    AirBNB announces their performance on a regular basis [1][2], especially since they were planning on going public 2020/2021, but Im talking about when they finish their quarter internally and asses how they stand as a company. We will start seeing a lot of layoffs from bigger companies when quarterly results come in. The first wave of layoffs were service industry, front line, immediately impacted by a stoppage of cash flow, there will be a cascading effect on the economy for a long time. [1] https://www.cnbc.com/2019/10/17/airbnbs-quarterly-loss-reportedly-doubled-in-q1.html https://www.cnbc.com/2019/10/17/airbnbs-quarterly-loss-repor... [2]https://skift.com/2020/03/12/airbnb-loses-276-million-and-6-other-takeaways-from-its-fourth-quarter/ https://skift.com/2020/03/12/airbnb-loses-276-million-and-6-...
  - popcat 7y ago
    Companies preparing to IPO start 'reporting earnings' internally a few years in advance. This is because of both SEC requirements and expectations of the banks working on the IPO. While quarterly earnings reports would not be publicly available, AirBnB certainly does do them internally.
JumpCrisscross 7y ago
There is a decent chance this crisis wipes out Airbnb’s equity, with the recent lenders owning most of not all of it within a year.
kaesar14 7y ago
Apparently internships are deferred till next year. Don't know how that'll work. It's entirely possible Airbnb never comes back after this, and that a competing product will not be able to fill its shoes. The regulation free zone that Airbnb was able to grow in no longer exists and will never come back, at least in the more urban areas. I'm not sure how they come back from this. They have 12k employees from what I've heard, there's significant fat to trim. Hopefully they can stay afloat.
- yibg 7y ago
  Seems like they have enough cash to ride this out. But yes very possible that they'll need to scale back dramatically and change their business model entirely. I'm guessing even after restrictions are lifted, people will be hesitant to travel and stay at airbnbs, and also many hosts will be nervous staying on the platform.
  - kaesar14 7y ago
    Yeah, the 2 billion dollars in loans will be enough to ride it out. I doubt whether they'll ever recover in the long term from this, though.
  - tenpies 7y ago
    Yes, even aside from all the ill will AirBnB has generated (both cumulatively and specific to this event), you have to ask: when was the last time you went to an AirBnB and it felt clean? Most hosts seems to do the absolute bare minimum since they know that the review system is mutually assured destruction.
    - esoterica 7y ago
      I've used AirBnb maybe 20 or so times and I've never had an AirBnB that felt or looked dirty.
      - r00fus 7y ago
        I've only used it twice, and it was mixed. The worst was the smell in the 2nd place.
JMTQp8lwXL 7y ago
Has anything fundamentally changed (in the long-term) about the short-term rental market? It's clear Airbnb would likely have a substantial drop in revenue, but they only have to make it through the crisis. What will this mean for the short-term rental properties themselves? There could be a new supply of housing on the market, as much of it was speculatively picked up. It's true that you can earn more operating a unit as a short-term rental, however in aggregate only so many can do that before demand dries up or price competition undercuts the increased profitably when compared to a long term tenant.
- kaesar14 7y ago
  The short term affects the market. Apparently Airbnb spent a lot of money on an Olympics marketing partnership, that's down the toilet. They've taken out 2 separate 1 billion dollar loans, one at 12%, another at 8%, in the last month(?). With their budgets strapped, they'll have less money and wherewithal to fight the legal battles they need to win to stay operational in many major urban markets around the world. The situation is absolutely dire, and their survival through the crisis is not a sure prospect in the slightest.
- ProAm 7y ago
  They have enough cash to make it through the crisis but the loans they will need to use will significantly affect their IPO which they need to do soon for their investors. Most want a return in ~10 years and AirBNB has passed that marker, seeing another money losing Unicorn on the stock market isnt what people want especially after the COVID crash.
- twblalock 7y ago
  In the long term, I don't think much has changed. The question is whether AirBnB can survive until people revert to normal travel behavior. In the short term there is little to no travel, and in the medium term there will be social distancing for a long time and less travel than before.
- ianmobbs 7y ago
  I wonder how many short-term rental owners are unable to pay their mortgages without Airbnb revenue
xiaolingxiao 7y ago
It's entirely possible state/local regulators will use the covid-19 moment to really clamp down on AirBnB. Thus erecting severe obstacles to its operations that endure long after Covid-19 has subsided. I'm not sure what kind of term Silver Lake laid down on AirBnB, it's possible that if/when Silver Lake does convert its debt to equity, it may wipe out most of the existing shareholders.
- Apocryphon 7y ago
  In terms of both political expediency and social good, it might not be a bad idea for them to crack down on Airbnb to increase the available housing supply that could potentially lower rents, in a time when economic insecurity drives voter fears about if they can make rent or not.
- Mediterraneo10 7y ago
  Poland recently announced that hotels will be allowed to open back up earlier than many other things, because the hospitality industry is such an important part of the economy. At this moment, I wonder if the authorities would be happy if AirBnB rentals started again, because that would get cash right into people’s hands during this time of crisis, and slightly lessen the expectation that the state has to hand out that money.
  - pjc50 7y ago
    That seems kind of backwards unless they've got very heavy testing - the last thing you want in a pandemic is travellers!
    - Mediterraneo10 7y ago
      Poland is a big enough country, and so a lot of the traveling is going to be domestic, or from other EU countries with which the borders are opened as the curve flattens in them, too. The authorities know that the weather is getting warmer and some people are going to travel for leisure and they can't really stop that. But also, a town’s accommodation options will be used by business travelers, or by people visiting family who, for whatever reason, cannot stay at those relatives’ homes, and that represents money coming into a local community which might really need it now.
look_lookatme 7y ago
I live in a vacation destination (that's also the commercial center of my state) and it's been interesting to watch the short term rentals start to pop up on craigslist (the state has banned short term rentals during the shutdown). There are a lot more than I thought there would be. The language evades that they are otherwise airbnbs, they are generally are offering limited terms (30-60 days) and they all have professional quality photos in the listing. Also, why do people decorate rentals with so much white? Isn't that a stain liability?
- bnjms 7y ago
  White bleaches out. Bright spaces are more inviting and photograph better. And once something white is clean, you can see it is clean, so you can "feel" how clean it is in a photo. And everything is from Ikea anyway so just throw it out if it's really done in. You've likely made enough to exchange some covers every six months.
draw_down 7y ago
Uh ohhhh.
333c 7y ago
Interesting. My internship (not at Airbnb) is still happening, but now remotely. I booked some housing through Airbnb without refunds, so now I am attempting to get a refund from Airbnb due to COVID–19.
jsonne 7y ago
A long or short term rental discoverability platform with payments, dispute resolution, and an availability calendar is really all that was needed. All of the experience stuff seems nice but really feels like a distraction. Airbnb for so long was so good at a very simple and useful thing. Genuinely, I wonder why this happens. Is this because companies raise too much money that they have to morph into some "experience" company that ever offers more and more to get more and more revenue growth until they eventually bloat to the tech equivalent of a department store? I see it repeatedly with not just tech companies but DTC brands that pretend to be tech companies as well. Is the pressure from VC money that you have short term opportunity but you eventually will mutate into a blob of a company that isn't really good at anything like so many old-world companies that die?
- JoshTko 7y ago
  It easy to estimate the revenue and hard to estimate the inefficiency. Revenue scales linearly while the inefficiency grows exponentially (even though it starts small). Inefficiencies such as Customer service rep training, brand dilution, shopping cart conversions rates, etc. all suffer a little when you add additional products. The "Wow look at the TAM of X!" is a powerful distraction that is hard to avoid without discipline.
- CalRobert 7y ago
  I always assumed "experiences" was a hedge against being made illegal by various jurisdictions.
  - Mediterraneo10 7y ago
    I always thought it was a way to derive profit from not only people's accommodation, but also whatever else they want to spend their time doing on their holidays.
    - saddestcatever 7y ago
      That was my thought. Same as ads. If the currency is the attention of users, why not double-dip profits! It's the same reason when I book a plane flight, someone's always trying to sell me the rental car while I'm there
agustif 7y ago
To everyone worrying about AirBnB surviving, didn't you see the 1 Billion loan they got last week?
tomashertus 7y ago
I have nothing against the people working at AirBnB and I wish them all the best of luck, but I genuinely hope that the AirBnB business model will get heavily regulated and controlled. I have heard plenty of horror stories from my hometown about the negative impact of AirBnB on the overall quality life for residents. It was proven [1], that number of AirBnB listings in a city has obviously negative impact on the rents and the price of housing [2] in a given city. All of us pay every month a premium for the success of AirBnB. [1] https://hbr.org/2019/04/research-when-airbnb-listings-in-a-city-increase-so-do-rent-prices https://hbr.org/2019/04/research-when-airbnb-listings-in-a-c... [2] https://www.epi.org/publication/the-economic-costs-and-benefits-of-airbnb-no-reason-for-local-policymakers-to-let-airbnb-bypass-tax-or-regulatory-obligations/ https://www.epi.org/publication/the-economic-costs-and-benef... Edit: Formatting & grammar fixes

65 points by stu2b50 7y ago

ProAm 7y ago

Layoffs coming after quarterly earnings.

iampims 7y ago
Airbnb is not a public company, which quarterly earnings are you thinking of?
- paulcole 7y ago
  I think that comment is just from a bot that picks from an HN Greatest Hits API to farm karma?
- ProAm 7y ago
  AirBNB announces their performance on a regular basis [1][2], especially since they were planning on going public 2020/2021, but Im talking about when they finish their quarter internally and asses how they stand as a company. We will start seeing a lot of layoffs from bigger companies when quarterly results come in. The first wave of layoffs were service industry, front line, immediately impacted by a stoppage of cash flow, there will be a cascading effect on the economy for a long time. [1] https://www.cnbc.com/2019/10/17/airbnbs-quarterly-loss-reportedly-doubled-in-q1.html https://www.cnbc.com/2019/10/17/airbnbs-quarterly-loss-repor... [2]https://skift.com/2020/03/12/airbnb-loses-276-million-and-6-other-takeaways-from-its-fourth-quarter/ https://skift.com/2020/03/12/airbnb-loses-276-million-and-6-...
- popcat 7y ago
  Companies preparing to IPO start 'reporting earnings' internally a few years in advance. This is because of both SEC requirements and expectations of the banks working on the IPO. While quarterly earnings reports would not be publicly available, AirBnB certainly does do them internally.

JumpCrisscross 7y ago

There is a decent chance this crisis wipes out Airbnb’s equity, with the recent lenders owning most of not all of it within a year.

kaesar14 7y ago

Apparently internships are deferred till next year. Don't know how that'll work. It's entirely possible Airbnb never comes back after this, and that a competing product will not be able to fill its shoes. The regulation free zone that Airbnb was able to grow in no longer exists and will never come back, at least in the more urban areas. I'm not sure how they come back from this. They have 12k employees from what I've heard, there's significant fat to trim. Hopefully they can stay afloat.

yibg 7y ago
Seems like they have enough cash to ride this out. But yes very possible that they'll need to scale back dramatically and change their business model entirely. I'm guessing even after restrictions are lifted, people will be hesitant to travel and stay at airbnbs, and also many hosts will be nervous staying on the platform.
- kaesar14 7y ago
  Yeah, the 2 billion dollars in loans will be enough to ride it out. I doubt whether they'll ever recover in the long term from this, though.
- tenpies 7y ago
  Yes, even aside from all the ill will AirBnB has generated (both cumulatively and specific to this event), you have to ask: when was the last time you went to an AirBnB and it felt clean? Most hosts seems to do the absolute bare minimum since they know that the review system is mutually assured destruction.
  - esoterica 7y ago
    I've used AirBnb maybe 20 or so times and I've never had an AirBnB that felt or looked dirty.
    - r00fus 7y ago
      I've only used it twice, and it was mixed. The worst was the smell in the 2nd place.

JMTQp8lwXL 7y ago

Has anything fundamentally changed (in the long-term) about the short-term rental market? It's clear Airbnb would likely have a substantial drop in revenue, but they only have to make it through the crisis. What will this mean for the short-term rental properties themselves? There could be a new supply of housing on the market, as much of it was speculatively picked up. It's true that you can earn more operating a unit as a short-term rental, however in aggregate only so many can do that before demand dries up or price competition undercuts the increased profitably when compared to a long term tenant.

kaesar14 7y ago
The short term affects the market. Apparently Airbnb spent a lot of money on an Olympics marketing partnership, that's down the toilet. They've taken out 2 separate 1 billion dollar loans, one at 12%, another at 8%, in the last month(?). With their budgets strapped, they'll have less money and wherewithal to fight the legal battles they need to win to stay operational in many major urban markets around the world. The situation is absolutely dire, and their survival through the crisis is not a sure prospect in the slightest.
ProAm 7y ago
They have enough cash to make it through the crisis but the loans they will need to use will significantly affect their IPO which they need to do soon for their investors. Most want a return in ~10 years and AirBNB has passed that marker, seeing another money losing Unicorn on the stock market isnt what people want especially after the COVID crash.
twblalock 7y ago
In the long term, I don't think much has changed. The question is whether AirBnB can survive until people revert to normal travel behavior. In the short term there is little to no travel, and in the medium term there will be social distancing for a long time and less travel than before.
ianmobbs 7y ago
I wonder how many short-term rental owners are unable to pay their mortgages without Airbnb revenue

xiaolingxiao 7y ago

It's entirely possible state/local regulators will use the covid-19 moment to really clamp down on AirBnB. Thus erecting severe obstacles to its operations that endure long after Covid-19 has subsided. I'm not sure what kind of term Silver Lake laid down on AirBnB, it's possible that if/when Silver Lake does convert its debt to equity, it may wipe out most of the existing shareholders.

Apocryphon 7y ago
In terms of both political expediency and social good, it might not be a bad idea for them to crack down on Airbnb to increase the available housing supply that could potentially lower rents, in a time when economic insecurity drives voter fears about if they can make rent or not.
Mediterraneo10 7y ago
Poland recently announced that hotels will be allowed to open back up earlier than many other things, because the hospitality industry is such an important part of the economy. At this moment, I wonder if the authorities would be happy if AirBnB rentals started again, because that would get cash right into people’s hands during this time of crisis, and slightly lessen the expectation that the state has to hand out that money.
- pjc50 7y ago
  That seems kind of backwards unless they've got very heavy testing - the last thing you want in a pandemic is travellers!
  - Mediterraneo10 7y ago
    Poland is a big enough country, and so a lot of the traveling is going to be domestic, or from other EU countries with which the borders are opened as the curve flattens in them, too. The authorities know that the weather is getting warmer and some people are going to travel for leisure and they can't really stop that. But also, a town’s accommodation options will be used by business travelers, or by people visiting family who, for whatever reason, cannot stay at those relatives’ homes, and that represents money coming into a local community which might really need it now.

look_lookatme 7y ago

I live in a vacation destination (that's also the commercial center of my state) and it's been interesting to watch the short term rentals start to pop up on craigslist (the state has banned short term rentals during the shutdown). There are a lot more than I thought there would be. The language evades that they are otherwise airbnbs, they are generally are offering limited terms (30-60 days) and they all have professional quality photos in the listing. Also, why do people decorate rentals with so much white? Isn't that a stain liability?

bnjms 7y ago
White bleaches out. Bright spaces are more inviting and photograph better. And once something white is clean, you can see it is clean, so you can "feel" how clean it is in a photo. And everything is from Ikea anyway so just throw it out if it's really done in. You've likely made enough to exchange some covers every six months.

draw_down 7y ago

Uh ohhhh.

333c 7y ago

Interesting. My internship (not at Airbnb) is still happening, but now remotely. I booked some housing through Airbnb without refunds, so now I am attempting to get a refund from Airbnb due to COVID–19.

jsonne 7y ago

A long or short term rental discoverability platform with payments, dispute resolution, and an availability calendar is really all that was needed. All of the experience stuff seems nice but really feels like a distraction. Airbnb for so long was so good at a very simple and useful thing. Genuinely, I wonder why this happens. Is this because companies raise too much money that they have to morph into some "experience" company that ever offers more and more to get more and more revenue growth until they eventually bloat to the tech equivalent of a department store? I see it repeatedly with not just tech companies but DTC brands that pretend to be tech companies as well. Is the pressure from VC money that you have short term opportunity but you eventually will mutate into a blob of a company that isn't really good at anything like so many old-world companies that die?

JoshTko 7y ago
It easy to estimate the revenue and hard to estimate the inefficiency. Revenue scales linearly while the inefficiency grows exponentially (even though it starts small). Inefficiencies such as Customer service rep training, brand dilution, shopping cart conversions rates, etc. all suffer a little when you add additional products. The "Wow look at the TAM of X!" is a powerful distraction that is hard to avoid without discipline.
CalRobert 7y ago
I always assumed "experiences" was a hedge against being made illegal by various jurisdictions.
- Mediterraneo10 7y ago
  I always thought it was a way to derive profit from not only people's accommodation, but also whatever else they want to spend their time doing on their holidays.
  - saddestcatever 7y ago
    That was my thought. Same as ads. If the currency is the attention of users, why not double-dip profits! It's the same reason when I book a plane flight, someone's always trying to sell me the rental car while I'm there

agustif 7y ago

To everyone worrying about AirBnB surviving, didn't you see the 1 Billion loan they got last week?

tomashertus 7y ago

I have nothing against the people working at AirBnB and I wish them all the best of luck, but I genuinely hope that the AirBnB business model will get heavily regulated and controlled. I have heard plenty of horror stories from my hometown about the negative impact of AirBnB on the overall quality life for residents. It was proven [1], that number of AirBnB listings in a city has obviously negative impact on the rents and the price of housing [2] in a given city. All of us pay every month a premium for the success of AirBnB. [1] https://hbr.org/2019/04/research-when-airbnb-listings-in-a-city-increase-so-do-rent-prices https://hbr.org/2019/04/research-when-airbnb-listings-in-a-c... [2] https://www.epi.org/publication/the-economic-costs-and-benefits-of-airbnb-no-reason-for-local-policymakers-to-let-airbnb-bypass-tax-or-regulatory-obligations/ https://www.epi.org/publication/the-economic-costs-and-benef... Edit: Formatting & grammar fixes