Airbnb is expanding into the temporary corporate housing market with a major strategic play. The San Francisco-based company is investing in Zeus Living, which leases unfurnished, private homes and converts them into corporate lodgings.
The young startup focuses on delivering high-quality, 30+ day living experiences for working professionals. Zeus Living stocks home care essentials, provides basic amenities, and sets up utilities so that visitors can plug in immediately upon arrival. The platform also allows users to sign leases and pay rent using credit cards or bank transfers.
Zeus Living has grown tremendously since its founding in 2015. The company grew revenue by 300 percent in 2019 and now manages more than 2,000 homes. Overall, Zeus Living has hosted nearly 30,000 people for 650,000 nights. With Airbnb jumping on board, the company is primed for significant growth in 2020.
Why is Airbnb Interested in Zeus Living?
The property tech space has become much more competitive since Airbnb opened the floodgates over a decade ago. Technology has completely transformed how people book temporary housing, whether it be for professional travel or personal fun.
By working with Zeus Living, Airbnb is trading access to its massive user base for a stronger foothold in the longer-term rental market. Airbnb will list Zeus Living properties on its site in exchange for part ownership in the rapidly growing disruptor. Zeus Living recently completed a $55 million Series B funding round, in which Airbnb was a key participant.
Zeus Living’s CEO, Kulveer Taggart, loves the partnership. “We have great alignment with the Airbnb team in terms of serving the changing needs of business travelers that want the comforts of home when traveling for extended 30-day stays for work or a project.”
Airbnb Expanding Outside of Vacation Rentals
Airbnb’s investment in Zeus Living is another example of how the company is pushing beyond the private home vacation rental market. Airbnb is looking more like a one-stop travel shop with its growing portfolio of assets.
Earlier this year, the travel platform launched Airbnb Adventures. The company also purchased HotelTonight back in March, an app that helps users find discounted hotel rooms. The acquisition gives Airbnb a better chance at attracting users who are hesitant to book stays in private residences. The move also puts Airbnb in direct competition with other travel sites, such as Expedia and Priceline.
Additionally, Airbnb is working with Miami-based Newgard Development Group to open a hybrid condo and hotel building that will feature over 600 spaces. All 412 condos and 192 hotel rooms will be available for booking through Airbnb’s site. Looking further down the road, Airbnb is planning to open branded hotels in Nashville, Orlando, and Austin.
Airbnb Not Rushing an IPO
Airbnb was founded in 2008. The $31 billion platform has exploded over the last 11 years and now has over five million listings in 191 countries. On average, two million people stay in Airbnb properties every night.
The company has yet to formalize plans for an IPO, alternative public offering, or a direct public offering. CEO Brian Chesky says his team can afford to be patient due to strong cash flows. “Most people that are really rushing to go public, the No. 1 reason they do is because they need the money. We don’t need to raise money, and so we haven’t been in a rush.”
It appears Airbnb will continue to be one of the higher-performing tech unicorns going into 2020. At a time when businesses like WeWork, Uber, and Peloton are struggling, the vacation rental giant is doubling down for the long haul.