- Silicon Valley startup Airbnb has picked up stake in
OYO Rooms , India's largest hotel rooms aggregator. - Business Insider had interviewed Airbnb's co-founder Nathan Blecharczyk earlier in March.
- Here are excerpts from his thoughts on the potential for Airbnb in India.
Both companies are looking at opportunities to collaborate on a range of projects, including making OYO accommodations available on the Airbnb platform, a source told Business Insider.
While Airbnb has not offered an official comment yet, here is an interview with the co-founder of Airbnb, Nathan Blecharzyk, that was conducted before the deal was announced. The following are the edited excerpts of the answers on the India-specific questions, including one about its competition with OYO, received via email on March 13.
Q. Airbnb had aimed to sign up 50,000 homestays in India by 2020. How far have you come? And what is your projection for, say, 2025? How big a part of the global business will India be by 2025?
Since the last time I was in India (which was early 2016) our community of hosts has gone from strength to strength and the number of Airbnb listings in India has increased by more than 150%. Our loyal community of hosts have welcomed more than 1.25 million travelers during that period, over 60% of which occurred in just the past 12 months. That growth isn’t just limited to foreign travelers; domestic travel on Airbnb in India has increased by 78% in the past year.
Travel to emerging economies is expected to increase at twice the rate of travel to advanced economies from now until 2030 and emerging markets like India are leading the way.
With over 45,000 listings, India is a key market for Airbnb. More than one million Indians have chosen Airbnb for their travel globally just last year alone, indicating a tremendous demand for Airbnb among the travellers. Needless to say, India continues to be a promising market for us. We are now working towards achieving 1 billion Airbnb users in the next ten years and India will play an important role in helping us achieve that goal.
Q. Are you disillusioned by the recent policy developments in India? Has that affected how bullish you are on India?
To the contrary, we’re committed to working closely with policymakers in India and we’ve worked diligently with them to promote home sharing.
Q. How big a role do discounts play in Airbnb’s business model?
Our platform is fuelled by hosts and guests who are loyal to Airbnb because we treat them like members of a community, not commodities. As a result, Airbnb isn’t governed by discounts and cash backs.
Q. Other companies like OYO rooms have scaled their business much faster in India. Was it a conscious decision on part of Airbnb to go slow in India? If yes, why?
We don’t typically comment on competitors. Travel and tourism is a large and growing industry in India, and there are going to be a lot of winners here. We are deeply committed to our community in India, we have a thriving business and we’re deeply optimistic about our future.
Q. Is Airbnb going to remain a product for English-speaking urban elites? Does it not cap the scalability of the business?
India is on its way to becoming one of the new ‘centres of influence’ in global tourism, and it’s going to be an engine of our growth, for us as we aim to welcome one billion users onto our platform in the next ten years. We really think Airbnb can be for everyone, and we have started to focus on specific segments and customize the products for those segments. We have our Plus offering, we have a high end luxury offering as well, and we also have Airbnb for Work, which is actually doing very well in India and it grew about four-fold year over year in India with about 6,500 companies that have signed up to do business travel directly with Airbnb.
Q. How feasible it is to sell airline tickets in India? It is a heavily competitive market and deep discounts are imperative?
We’re not interested in building our own airline or creating just another place on the Internet where you can buy a plane ticket, but there is a tremendous opportunity to improve the transportation experience for everyone. We’re going to explore a broad range of ideas and partnerships that can make transportation better. We haven’t settled on exactly what those will look like.
Q. Will it be easier for you to focus on Indian travellers who are headed abroad than to convince Indians to share their homes with strangers? Would that be your approach to evade some of the policy and infrastructure challenges?
Global tourism is growing rapidly and as citizens, businesses and policy-makers open up to the sharing economy phenomenon, and we are seeing increased interest in emerging economies like India. Our loyal community of hosts have welcomed more than 1.25 million travelers since 2016, over 60% of which occured in just the past 12 months. Our growth isn’t just limited to foreign travelers. Domestic travel on Airbnb in India has increased by 78% in the past year. India has approx 410 million millennials, that’s more than the entire population of the US. This group increasingly makes up the dominant segment of consumers, and are looking for new and authentic travel experiences. So while India sees close to 1.2 million outbound travellers, the number of domestic guest arrivals on Airbnb in India increased by almost 78%, last year. We are also planning to focus to more on mainstream domestic travel over the course of the next 2 years i.e. by 2020-21 in line with the origin total addressable market of $17.5 billion which is dominated by domestic business, which is 74% of total total addressable market.
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Airbnb picks up a stake in its Indian rival Oyo Rooms