Airbnb: Business Model Development and Future Challenges

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Case

Reference no. W42147

Subject category: Strategy and General Management

Authors: Sayan Chatterjee (Weatherhead School of Management, Case Western Reserve University)

Published by: Ivey Publishing

Originally published in: 2016

Version: 2016-11-24

Length: 14 pages

Data source: Published sources

Topics: Sharing economy; Network model; Business model innovation; Design; General management

Share a link: https://casecent.re/p/203644

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Abstract

This is a Simplified Chinese version. In 2007, the founders of Airbnb were looking to solve a problem and ended up transforming their idea into a USD10 billion company. What started as a quick website to advertise an overnight stay on their apartment airbed along with breakfast in the morning eventually grew into an online accommodation booking business that spanned the world. Airbnb used its business model to carve out an extremely important space in an already crowded industry. However, along with success came challenges in terms of the scalability of its business model. In 2014, Airbnb was also facing legal challenges by state Attorneys General that could make its business model suspect. The founders had to decide whether to defend their business model in a court of law and in the court of public opinion, or change it.