How Airbnb is generating profit

Unlocking a Profit Potential: How profitable is Airbnb

Airbnb has revolutionized the hospitality industry by connecting people with housing needs with landlords who have properties to rent. Its business model has generated significant returns for investors and owners. Take a look at how it is making money and what it means for the future of the industry.

Airbnb stock


During the global economic recession of 2008, the United States experienced a loss of 2.6 million jobs, and a recession was officially declared. A recession is characterized by a temporary decline in economic activity and trade, typically indicated by two consecutive quarters of GDP reduction. The world economy had declined by 2 trillion dollars. In these devastating times, Airbnb was founded, and it was the company that used the recession to make billions of dollars.


Before the 2008 recession, most people would never allow a stranger to live in their house no matter how high they were willing to pay. Still, in 2008, most people were suffering from unemployment and bankruptcy. They were not able to pay their bills as well, even the founders had to rent out their apartments to pay their fees,  this was seen as a golden opportunity by the founders and they launched their service since people had to become a bit more welcoming to make them both ends meet Airbnb was able to find business during the time.

Why Airbnb

So the question arises of why only Airbnb capitalized on this. They did not just launch the right service at the right time they were the first to:


When this model of renting out homes to strangers was relatively inexperienced, people could not gain each other’s trust, so Airbnb shifted its focus to this problem. They tried and tested many ways to enhance the trust model between host and guest and they figured out that if the guest and the host introduced themselves in an excellent way rather than in a formal way and told about themselves the guest would feel very comfortable. They also discovered that if the guest and host had more things in common they would be more satisfied with the experience. 

For example, if the guest is a 23-year-old from Houston and the host in New York is a 45-year-old with no similar interests there is a high chance this meeting won’t work so well. However, if the New Yorker is also a relatively young and lively person native of Houston the experience would be smoother.


AIRBNB allows the listed hosts and guests to introduce themselves and share their feedback and experiences.

According to modern business reports, this is the most effective way to improve; by taking out problems and solutions directly from consumers and service providers.

Business reports

3. Deep work

When Airbnb was in its initial days its founders were told by one of their experienced investors that they should go out and talk to the hosts themselves physically since there was no concept of online meetings back then, so the founders went to New York from where most of their hosts were from.

They made a very unconventional move as they spoke to all of the hosts during their three-week stay in New York to discuss the company’s future, about what improvements they could bring to their rental.

For example, Airbnb founders found out that despite having a perfect and well-decorated room it wasn’t looking up to the mark in pictures, that was due to the low camera quality which was affecting their sales so these guys went out and rented a camera, and photographed many of the rooms themselves, this was the level of effort they had put and this helped the founders to make a loyal consumer system, all of the hosts that had signed up for the Airbnb service stayed with the Airbnb service since this next level of empathy was achieved between them. This helped the founders form a company that rose from the ashes during a recession when only a fool would build a company from scratch.

4. Word of mouth

Even in basic things, Airbnb’s founding partners put in a lot of effort to make word of mouth their marketing tool. This effort combined with the model of suitable timing, designing trust, and most importantly an effect of empathy laid the foundation for a self-sustainable marketing method that is word of mouth. Soon after the New York designation, listings from hosts and guests around the world started appearing on Airbnb.


With the combined effort of Airbnb developers, consumers, and providers it became one of the largest companies in the world of its type.

Airbnb reached $10 billion in 2014 and has approximately 6 million properties worldwide. It has main offices in 31 cities. Guests on Airbnb have stayed 400 million times since its launch and are active in 98% of the world. Their demand is highest in the United States, with 99.5 million nights booked in 2021. They made about 4.7 billion dollars in 2019 alone despite being a relatively low-margin business.


In conclusion, Airbnb can unlock a significant profit potential for property owners. By embracing the platform’s principles, offering exceptional experiences, and managing the challenges, hosts can tap into a lucrative income stream. Airbnb’s effect on the hospitality sector is projected to rise as customers become more interested in personalized and unique housing alternatives.


Is Airbnb a safe option for travelers?

Airbnb takes safety seriously and provides features like verified profiles, secure payment systems, and 24/7 customer support to ensure a secure experience for travelers.

How do I become an Airbnb host?

To become a host, sign up on the Airbnb platform, create a compelling listing, and set your availability and house rules.

Can I use Airbnb to rent out a single room in my house?

Yes, you can choose to rent out a single room or your entire property on Airbnb, depending on your preference.

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