Anti-Hotel Service Rivalry Heats Up As Wimdu Threatens To "Kick Airbnb's Ass"

Wimdu offers a glimpse into its plans for giving nearly identical rent-your-room service Airbnb a run for its huge chunk of money.

Wimdu

A dozen or so twentysomethings met for an apparent company outing on a recent Thursday evening in 90-plus degree heat at an outdoor spot in New York's East Village called B Bar. It's as much of a home to bridge-and-tunnel crowds as it is to first-year M&A bankers. These particular unbuttoned button-downers had cause for a pep rally. They huddled close and hoisted glasses of liquor skyward, and one hollered: "Here's to kicking Airbnb's ass!" And everyone slammed their shots in unison.

The revelers were employees of Wimdu, the closest competitor (or clone, depending on your take) to Airbnb, a marketplace for travel accommodations that allows people to rent out their homes to travelers. It's part of a rapidly growing new "sharing economy," in which people rent out all kinds of their own stuff—rooms, cars, and spaces to park them in. The concept has just helped Airbnb raise $112 million from the likes of DST, Andreessen Horowitz, and Ashton Kutcher. Its service is featured in more than 181 countries and 13,000 cities; it's received glowing praise from a slew of major media outlets; and it's on track to take in $25 million of net revenues on $500 million in flow-through sales this year.

Wimdu boasts listings in more than 50 countries, a user base that's growing 200% weekly, and its own staggering chunk of recent funding, $90 million.

"Wimdu is a fast-growing global business—we're really trying to revolutionize the travel industry," says Wimdu cofounder Russell Goldman in a comparatively sober phone call long after the New York bar scene had passed. "Airbnb is a competitor in the market, and that's what we were toasting to: We want to be the best, globally and locally," he says.

To Wimdu, the gap between its own $90 million and Airbnb's $112 million means there's a giant target on their rival's ... "ass." But the two similar services' combined $202 million is an even bigger sign of the stuff-for-rent market. With so much at stake, the competition between Airbnb and Wimdu could eventually make the Groupon-Living Social rivalry seem like a high school slap fight.

To win, Wimdu aims to provide a better experience for consumers—something Airbnb is currently learning about by way of one horrific customer experience that made headlines in the past few days. Wimdu invests heavily in customer service and is laser-focused on streamlining the booking process. Additionally, the startup has more than 450 employees and 15 offices in countries around the globe, all working to goose local host listings. Wimdu currently features more than 20,000 accommodations, a figure that's doubling every four weeks. "We're experts in online operations," Goldman says. "Our funding helps us be a well-oiled machine."

But as quickly as the Wimdu machine is moving, there's a sense that it can't move quickly enough. With Airbnb's latest round of funding, which valued the San Francisco-based startup at $1.3 billion, Wimdu will have an even harder time catching up to its competitor. When Fast Company recently asked Andreessen Horowitz partner Jeff Jordan what lessons should be drawn from Airbnb's experience, Jordan, referring to the startup's massive funding, said with a laugh, "[For] other competitors, hopefully the lesson is: Stop."

Goldman must have skipped that class. "I don't know what [their funding] means for us," he says. "We have to see how they use that money." While he agrees Airbnb is a direct competitor, Goldman argues that Wimdu's "biggest competitor … is the hotel industry," a trillion-dollar market that's waiting to be captured.

"We want to be the best," Goldman says—the third time he repeated that statement during our discussion.

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4 Comments

  • Selma

    Guess that's what happens when you give little boys too much money to play with-they get cocky and spend it on shots! You neglected to mention iStopOver and Roomorama, two companies kicking a** without raising major funding in the space. Should be interesting to how things shake out...

  • Jeremy Burns

    The model used by AirBnB and Wimdu is the one that VRBO launched at least 05 years ago for high end seasonal rentals around the globe, which are quite famous in Europe, where the labeled "sharing economy" it's a native feature of its own culture (hitchhiking, couchsurfing, etc). The problem of that model is that it's not disrupting their potential market as it's not generating a real competitive edge, just like the web coupon model. The one who gets the competitive edge is the one who is going to revolt the market. 

  • gpwell

    I think Wimdu will really have its work cut out for it. In my experience, its has been very difficult for european companies (especially German and Scandinavian ones) to replicate the American customer service experience.