This is the funny math that got Groupon in trouble when it IPO'd. You can't count revenue as the main metric. You have to look at costs & profits.

Any bootstrapped business will tell you this - but somehow everyone forgets it when it's VC money.

P&L is not a useful metric for growing startups.

If the lifetime value of an Airbnb customer exceeds their marginal cost (including COA), Airbnb should buy customers all day long.

I strongly suspect Airbnb's marginal returns are fantastic. Their model seems highly profitable on a unit basis.

I'm not saying it is or isn't - what I'm saying is you have to realize that revenue ≠ profit and failure to do so gets you something like what happened to Groupon.

Does that revenue figure include the percent paid to the hosts with each booking?

Their take is nowhere near $1 billion in annual revenue.

It would imply they're taking a thousand dollars in sales or so per listing per year at this point. That would more than require every listing be sold out at all times.

> It would imply they're taking a thousand dollars in sales or so per listing per year at this point. That would more than require every listing be sold out at all times.

I don't follow.

Their take is ~10%, so $1,000 of revenue for them requires $10,000 in annual bookings. If every listing is listed 100% of the time, that would imply an average rate of $27/night. (Highly unlikely.)

Seems incidental to me that money is technically going to their bank account(s) while the payments are being processed.

Actually, it is near $1B. Their gross is in the billions.

Revenue, not bookings. These numbers (if correct) would represent 15% of bookings.