Airbnb: Business Model Development and Future Challenges
(8 pages of text)
Case (Pub Mat)
In 2007, the founders of Airbnb were looking to solve a problem and ended up transforming their idea into a $10 billion company. What started as a quick website to advertise an overnight stay on their apartment airbeds along with breakfast in the morning eventually grew into an online accommodation booking business that spanned the world. Airbnb used its business model to carve out an extremely important space in an already crowded industry. However, along with success came challenges in terms of the scalability of its business model. In 2014, Airbnb was also facing legal challenges by state attorneys general that could make its business model suspect. The founders had to decide whether to defend their business model in a court of law and in the court of public opinion, or change it.
This case is intended for senior undergraduate, MBA, and EMBA strategy classes. After completing the case, students should be able to
- understand how the different components of a strategy combine to create a competitive advantage;
- recognize that although competitors may be able to copy one or more parts of a strategy, the holistic manner in which the different parts combine makes it difficult to copy the entire strategy; and
- decide between different options.
Accommodation & Food Services
United States, Medium, 2014
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