RJ Metrics sampled over 60,000 users to shed light on how users are interacting with the rent-out-your-spare-room service—and the numbers help explain what Andreessen Horowitz, DST Global, and General Catalyst saw when they recently invested a whopping $112 million into the startup.
According to the report, Airbnb has more than 2.1 million registered users, a base that's growing by about 250% year-over-year. RJ Metrics estimates that, at this rate, the company will have 4 million users by August and possibly 6 million registered users by the year's end.
An important note on RJ Metric's figure: The firm did not have direct access to Airbnb booking data, so it used publicly available reviews as a proxy for activity. "Reviews are the lifeblood of the Airbnb community, so we think it's fair to assume that the number of reviews is a good proxy for the number of stays," the company said. A spokesperson for Airbnb said the company does not comment on third-party speculation.
In March, Fast Company named Airbnb to our list of the world's 50 Most Innovative Companies. The reason was clear: The digital accommodations marketplace, which enables users to rent out spare rooms online for extra (or even life-saving) cash, was not only disrupting the stodgy hotel industry, but rocketing in growth—and leading the way in a new sharing economy. Airbnb has already booked more than 5 million nights, and is said to have facilitated roughly $500 million in flow-through sales last year.
Knowing that we might have to take RJ Metric's new data with a grain of salt, here are some of the firm's other findings:
- Almost 85% of Airbnb's user base has never received a review as a host or a guest. Our sample suggests that there may be as few as 350,000 reviewed users among the user base of over 2 million.
- Only 16% of the user base has been reviewed as a host or a guest
- 5% of users (or about 100,000 users) have active listings, but only 2% (or about 40,000 users) have received reviews from guests.
- Only about 14% of users (or about 300,000 users) have been reviewed as guests.
- Only about 2.3% of users (or about 50,000 users) have been reviewed as hosts.
- A mere 0.5% of the user base has been reviewed as both guest and host.
This may sound like bad news for Airbnb, but these statistics aren't necessarily the best indicators of the company's business. For one, reviews are not the most accurate proxy for stays. Second, unlike Facebook, Twitter, and other social networks, Airbnb does not need to rely on the number of daily or monthly active users, though it naturally aims to foster a more active user base. Users are likely to go on vacation or be away for work less often than they would check out their Instagram feed, in other words. "As with most consumer sites...the population of active users is much smaller than the total registered user count," RJ Metrics says in its report.
And lastly, Airbnb represents a radical shift in traditional user behavior. It's still incredibly early in the company's history, and it may take time to adapt to this new lifestyle.
Significantly more telling is the blossoming usage among its active user base. "While only about 14% of the user base ever books a stay (as indicated by a first review from a host), 22% of those users who book once go on to book a second stay via Airbnb," the report claims. "By the time a user has booked five stays, the likelihood that they will book another stay on Airbnb is over 50%."
Or, to put it more bluntly, "usage is addictive," the report concludes. "With each additional stay booked through Airbnb, users become increasingly likely to book again."
They just need to get a taste first.
[Image: Flickr user Jon Martin]