Marc McCabe has become a familiar name among people working in human resources departments around Silicon Valley.
When it’s time to compile travel expenses for the month, McCabe, who runs the business travel group at Airbnb, would manually send out invoices and Excel spreadsheets breaking down how much a company’s employees spent on room rentals.
As the number of companies using Airbnb has ballooned to 250, McCabe’s monthly e-mails and the kludgy system of creating custom coupon codes that employees must enter when booking travel have not stood the test of time. On July 20, the San Francisco room-rental company plans to introduce a revamped Airbnb for Business, which includes a central billing system and a dashboard for human resources representatives and travel managers to track employee spending. The company is also kicking off a marketing campaign around the new business product.
Airbnb says it’s getting serious about going after corporate customers. The company introduced a rudimentary system called Business Travel on Airbnb about a year ago, after it received requests for such a service—mostly from other tech companies whose staffers might not mind crashing on pull-out couches. Corporate customers have since been asking for a more robust way to manage expenses and see where employees are staying. “Historically, it’s been a super-manual process,” says Mike Lewis, a product manager for business travel at Airbnb.
In the last year, signups from companies using Airbnb’s business service have grown eightfold. Google, Salesforce.com, SoundCloud and Vox Media are among those already on board. Twilio, a San Francisco company that makes software development tools, uses Airbnb to put up some new hires for as long as a month while they relocate from a different city.
“That gives them enough time to figure out San Francisco,” says Kelly Cammer, Twilio’s travel manager. It also provides recruits with a more authentic experience than a hotel would offer, she says.
It’s harder to imagine a Wall Street analyst or sales executive agreeing to stay in a stranger’s apartment in Dallas without putting up a fight. Business travelers appreciate the pampering and travel points that come with a five-star hotel. For now, Airbnb thinks it can gain a foothold with extended-stay business travel, or with off-site meetings for which a team wants to stay in a house together, says Chip Conley, head of hospitality and strategy at Airbnb.
Airbnb says about 10 percent of rentals are from businesses, comparable to what it was a year ago. Still, the company sees a big opportunity. U.S. business travel spending is expected to reach $302.7 billion by the end of 2015, and climb 5.4 percent next year, according to research from the Global Business Travel Association and Visa.
“Corporate travel is a big part of the travel pie; it’s worth a lot of money,” says Nathan Blecharczyk, chief technology officer and co-founder of Airbnb. “We’re further along there on our leisure side than our business side.”
Additional tech companies have been identifying the power of the expense account. In July, Uber accounted for 55 percent of all rides expensed by employees whose companies use Certify, the second-largest provider of travel and expense management software in North America.
Certify’s data also show promise for Airbnb: Expenses for Airbnb through Certify’s system grew 143 percent from the first quarter of 2015 to the second. Airbnb has teamed up with another expense provider, Concur Technologies, to integrate their two systems more closely. To appeal to global businesses, Airbnb’s new tool will be available in more than two dozen languages.
Airbnb has held talks to raise a round of financing at a $24 billion valuation, a person familiar with the matter said in June. That would make the seven-year-old company more valuable than Marriott International or Starwood Hotels & Resorts. While Airbnb declined to disclose its revenue or losses, the company will need to find a way to compete across all types of travel, including corporate jet-setters, to truly take on the hotel giants.
This article was written by Eric Newcomer from Bloomberg and was legally licensed through the NewsCred publisher network.