Airbnb announced Monday that it has appointed former White House chief of staff and a prominent figure in Democratic circles Ron Klain as its chief legal officer.
Welcome to a brand new week, folks! Here’s a Tuesday tidbit for you: Between 2020 and 2021, Manhattan residents who moved to Miami brought $2.9 billion in taxable income with them. And Palm Beach County netted $1.06 billion from these Manhattan ex-pats. Wow, that’s some serious wealth migration.
Alright, strap in, we have a long one today.
- Airbnb lands ex-Biden official
- FTC ran the numbers on fees
- Joivy launches
A Cultural Rebrand
I have always wondered why companies decide to rebrand and change identities? And if it indeed achieves the goal — did we switch to calling Facebook, Meta? Are you Alphabet-ing something on the internet or do you continue to Google?
I am not going near X, the former Twitter, that one has most branding pundits puzzled.
But here’s the thing about these rebrands; these are services or products (depends on your tech philosophy) that we consume everyday. What might be the motive of non-consumer facing brands to do this?
I had the opportunity to ask this question to Italian property manager DoveVivo Group, which along with its affiliate brands Altido and Chez Nestor, is changing its name to Joivy.
This joint entity will offer student housing, short term rentals, multifamily apartments, and co-working spaces. Presently, the group operates 4,000 units located in 50 destinations and six countries — all in Europe.
DoveVivo Managing Director Giulio Limongelli said the aim of this rebranding, in part, is to communicate its new brand identity to B2B partners — landlords. And to cement the company’s culture and identity to reflect its global operations.
“It’s important externally that we present a united front in a more accessible, easily understood way rather than a group with arms and legs which have predominantly come through an acquisition,” Altido CEO William Parry said.
Now this is starting to make more sense.
The latest data from the Vermont Housing Finance Agency reveals a continuous rise in the availability of short-term rentals, including Airbnbs and Vrbo properties. As of September, the state recorded 11,747 STRs, a 16% increase from September 2022. Despite a temporary slowdown during the pandemic, the numbers bounced back after the removal of travel and Covid restrictions, The Manchester Journal reported.
Notably, the strongest months for short-term rentals are September and October, while February, March, and November are less active. The data also indicated a slight dip in average monthly revenue per rental from September 2022 to 2023, settling at $4,181.
The majority of the short-term rental hosts were from Vermont (55%), with out-of-state owners renting the rest. Interestingly, 71% of Vermont’s vacant homes are categorized as “seasonal, occasional use, or vacation homes,” highlighting the contrast with the shortage of homes for sale (4%).
Cabana Seeks Saviors
Cabana, a startup facilitating camper van bookings for vacation rentals, is actively seeking buyers in a bid to avoid closure, Skift’s Justin Dawes writes.
CEO Scott Kubly emphasizes the company’s potential for scalability but acknowledges the need for an acquirer to sustain operations. Cabana’s platform, initially owning the vans, now operates on a model where it rents vans on behalf of owners, with a long-term goal of providing booking management and back-office software to van owners.
Despite growing demand and increased revenue, the company requires capital for scaling and achieving profitability, Kubly said. Unable to secure additional venture capital, Cabana is exploring sale options, with a preference for a buyer interested in acquiring the entire company, not just its assets. The company aims to finalize a deal by November 30, with a letter of intent from a potential buyer by today.
The shift in the market, influenced by rising interest rates, poses challenges for startups that aggressively raised funds during periods of low interest rates. Investors, originally focused on growth potential, are now more cautious, impacting mid-stage startups like Cabana. The current market dynamics make it challenging for companies that raised substantial funds a few years ago to secure additional investment.
Is This How Airbnb Can Make More $$?
A recent report from financial firm BTIG explores potential revenue-boosting scenarios for Airbnb, suggesting the platform could increase host fees from $4 to $6.50 per night, generating an additional $1.3 billion in annual revenue, writes Skift’s Dennis Schaal.
However, the report acknowledges potential challenges, including host dissatisfaction and increased competition. Another avenue for revenue is the introduction of sponsored listings, a concept previously discussed by Airbnb CEO Brian Chesky.
The report estimates potential annual revenue from sponsored listings at $550 million to $1.1 billion in the next five years, citing concerns that this move could favor large property managers over individual hosts. While Airbnb has not confirmed specific plans for sponsored listings, Chesky hinted at upcoming new tools and services for hosts over the next few years during the third-quarter earnings call. Airbnb declined to comment on the BTIG report’s findings.
Airbnb Snags Former Biden Aide
Airbnb announced Monday that it has appointed former White House chief of staff and a prominent figure in Democratic circles Ron Klain as its chief legal officer. A close Biden aide, Klain will begin his role at the company starting January 1.
Last year, Airbnb appointed Jay Carney as its global head of policy and communications. Carney handled public relations for Amazon for seven years after serving as the White House press secretary for the Obama administration.
Klain, known for his strategic thinking, operational expertise, and close ties to Washington, will report directly to Airbnb co-founder and CEO Brian Chesky.
Frank With Fees
The Federal Trade Commission (FTC) recently published a comprehensive proposed rule in the Federal Register, emphasizing the impact of fee transparency on time savings for online bookings.
The document details the proposed rules, calculating time savings and compliance costs over a 10-year period for various sectors, including live ticketing, hotels, short-term rentals, and restaurants. In the short-term lodging sector, the FTC analysis suggests positive benefits if the per-consumer benefit is at least $6.65 annually over a decade.
The benefits stem from enhanced price transparency, leading to more efficient shopping, while costs increase from firms complying with the proposed rule. U.S. consumers could save between $663 million and $980 million per year, totaling $4 billion to $8 billion over 10 years.
The upcoming fall fiscal update from Canadian Finance Minister Chrystia Freeland will include measures to discourage property owners from using their homes as short-term rentals, particularly in areas already restricting such rentals, The Star reported.
According to a senior federal official, property owners in these areas will no longer be able to claim rental expenses against their income, aiming to remove incentives to list properties on platforms like Airbnb despite local restrictions.
The move is part of broader efforts by the federal government to address housing challenges, with a focus on increasing housing supply. The Canada Mortgage and Housing Corp. has called for adding at least 3.5 million units to improve housing affordability in the next decade.
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