Can the real Airbnb please stand up?
It has long seemed to me there are two Airbnbs. On one hand, it's the online marketplace that created millions of places to stay for millions of guests. On the other, there is the "move fast, break things" disruptor that has been criticized for exacerbating housing crises from Barcelona to the Bay Area.
Inside the company, it turns out, Airbnb is also two different things. It started as a for-profit company, brokering the market for short- and long-term stays around the world, taking a commission on every booking made through its platform. Then, after Hurricane Sandy hit New York in 2012, Airbnb gained a second identity: as a nonprofit helping refugees and evacuees find temporary housing.
Of course, a company doing nonprofit activities adjacent to its core business model is nothing new. Just about every business today has a philanthropy or corporate social responsibility arm. But as social impact has become central to corporate identities, it surprised me that Airbnb went the opposite way, proudly separating its dotcom activities from those of Airbnb.org.
Why is that, and is it a model for others to follow?
Catherine Powell, the executive in charge of hosting at the for-profit Airbnb, said that after initially running the nonprofit initiatives in-house, they "wanted to scale,” but couldn't. "We wanted to have...a nonprofit where we had clear and discrete relations with NGOs and governments, [and were] able to fundraise.”
That became much easier, she said, when Airbnb became both a dot-org and a dotcom. And some people who were hesitant to become hosts for Airbnb.com, the company found, were willing to open their doors for a nonprofit housing refugees. So the company set up its nonprofit as a separate legal entity.
Since Airbnb.org's legal creation, its director Katherine Woo told me, the nonprofit has helped temporarily house over 300,000 people, including 200,000 refugees from countries like Ukraine, Afghanistan, and Venezuela. On the flip side, 91,000 hosts from just about every country in the world have signed up to welcome those who have been displaced from their own homes.
To generate this kind of impact, Woo said, Airbnb.org can lean on its for-profit parent in a variety of ways, including funding, brand recognition, access to the .com platform for its search and booking features, as well as shared office space, back-office functions, and employees.
The dot-org's activities also flow back to the dotcom. One way the nonprofit’s donations are used, Woo said, is to provide “travel credits directly to refugees,” who can then use them to “book any stay on Airbnb.com” or elsewhere. (Airbnb, to be clear, takes no commissions or fees on dot-org bookings on its platform.)
It’s a reminder of the power technology can have when deployed for good and a testament to the goodwill and commitment of Airbnb’s founders.
But I’d hesitate to call it a model to follow.
For one thing, the “independent” nonprofit isn’t that independent: Its board was selected by Airbnb company founders and executives, and its employee base and IP exist in the good graces of Airbnb. That dependence could pose problems and could blur the lines between the two brands.
Perhaps the bigger issue, though, is that by separating “doing well” from “doing good,” Airbnb.com may lose sight of its full societal impact. Airbnb was a great business idea, and its founders' idealism still trickles down.
But its practices also have a darker side. Airbnb has almost certainly played a role in making certain housing markets unaffordable for residents, as the Financial Times again showed this week, and some question the structure and transparency of the fees it charges. By shifting its social impact to a nonprofit arm, the company may have effectively stopped taking full responsibility for its impact.
To me, Airbnb partially acknowledged that issue, when Powell told me they "don’t calculate” the company's social impact. “It’s so integrated in the way we operate, we don’t break it out,” she said.
Still, “We want to behave like a 21st-century company,” she insisted. “We take the needs of all of our stakeholders very seriously.” Airbnb teams regularly interact with governments about their concerns, she said, and the company’s revamped platform is explicitly redesigned to help travelers explore new destinations, rather than contributing to over-tourism.
Is it enough? Do you consider the dotcom-plus-dot-org structure to be a model? I'd be interested in hearing your thoughts.
Separately, we'll be welcoming Google chief sustainability officer Kate Brandt next Monday, Aug. 28, at 12 p.m. Eastern for our last "Sustainability 101" webinar. If you'd like to attend, you can sign up here. We'll also discuss sustainability and social impact at our Impact Initiative conference, which takes place in Atlanta, Sept. 12-13. Sign up here.
Peter Vanham
Executive Editor, Fortune
peter.vanham@fortune.com
This edition of Impact Report was edited by Holly Ojalvo.
