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Venture-funded startups in the U.S. are swapping offices for team trips as their leases expire.
Travel expenses are now “blasting through the roof,” according to accounting firm Kruze Consulting, which has been analyzing the spending patterns of 400 startups since the start of 2019.
Only 60 percent of startups are currently paying for rent, with that amount set to decrease as many expect to cancel their lease as soon as it expires. In the first quarter of 2019, 85 percent had office outgoings. “They are reducing their footprints in favor of a continued remote/hybrid workforce,” the company said.
The average quarterly rent expense is also the lowest to date, at $21,000 per quarter per company. During the fourth quarter of 2019 it was $32,000.
Co-working space providers would be the logical benefactors, but it turns out the cash is going into the pockets of Airbnb hosts instead. “The companies that we’ve talked to are renting big Airbnbs and going on in-person working off-sites with the entire company or specific groups like product or engineering,” the company added.
Airbnb’s made no secret of its push for more corporate guests in recent years, but during the past few months has ramped up those efforts, with a new feature that allows guests to check the property’s Wi-Fi speed, and a digital nomad campaign.
Stays of 28 days or longer were also the fastest-growing trip-length category for its second quarter, with CEO Brian Chesky saying he believes remote working is “here to stay.”