The sharing economy is here, and it’s changing how we live, work, and travel. When you’re not using your car to commute, stay in hotels for business trips, or buy goods from major retailers, you’re living in the sharing economy.
Airbnb is at the forefront of this trend. The company has taken over the hotel industry by allowing people to rent out their homes to guests on a short-term basis. This has made it easier for travelers to find affordable accommodations without having to worry about carrying around cash–because all transactions are conducted through Airbnb’s online payment system.
The company also offers a service that allows homeowners with enough space to rent out their home as an entire apartment for periods longer than 30 days
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What is Airbnb
Airbnb is a website that connects guests to temporary accommodations around the world. It’s an online service that hosts travelers who want a place to stay for a couple of days or more in a new area. This type of website has been around since 2001, but it’s only in the past few years that it has become so popular.
Unlike traditional hotel chains, the majority of Airbnb hosts don’t own the building that they are renting out. They are often located in large buildings, apartment complexes, or even people’s homes that they lease out to visitors.
Also unlike traditional hotels, most Airbnb hosts don’t charge per-night prices. Instead, they set the price for each listing, which can be anywhere from $50 to $300 a night.
Airbnb is the second-most valuable startup in the U.S. after Uber. It has been worth $30 billion since it was founded in 2008.
Airbnb has become a household name. It has a cult following for a good reason. It’s no secret that there are often too many vacationers in the cities where I live, and the constant noise has driven many local residents into a frenzy.
Airbnb has helped a lot of people who couldn’t otherwise afford it get more vacation time and vacationers to come see their homes.
More people than ever are using Airbnb to visit new and interesting places. Many of those people will return to see friends and family, thanks to the app and website. Airbnb has effectively made trips much more accessible for people living far from the United States or Europe.
While Airbnb stock has been the most valuable online travel service, it’s still a nascent business. And there are a few reasons why the shares of this company haven’t gone to the moon yet.
For one thing, the company isn’t profitable yet.
In 2015, Airbnb reported negative $24 million in revenue, with an operating loss of $76 million. Even after spending on marketing and expanding its operational infrastructure, Airbnb still lost money. The company announced a net loss of $110 million in 2016.
As an investment, that’s a concern. As new businesses mature, they tend to become more profitable.
One good sign for investors is that Airbnb’s losses are decreasing. However, the company had negative cash flow of $269 million in 2016.
On the other hand, Airbnb also made a big move in 2016.
Conclusion
Most investors don’t have the expertise to make decisions like whether or not to buy a stock. However, it’s possible to determine whether a stock is a good investment by determining if the company is a strong, growing company that generates a decent return on investment.
At the time of this writing, the author did not own any shares of any of the companies mentioned.
