Friday, June 26, 2020

The No-tell Motel of Airbnb's

Many years ago, my husband and I, as we made our way from Boston to Prague, were on a lllloooonnnngggg layover in Frankfurt. Already in the zombie stupor that comes with an all-nighter to Europe - a red eye if ever - the thought of hanging around Frankfurt Airport, which is large, noisy and chaotic, was overwhelming. We spied a Sheraton Hotel just across the way from our terminal. Hmmm.

We rolled our bags over and asked if we could get a room for a few hours. 

The answer: Jawohl! They had a 4 hour rate. Perfect!

We had breakfast frühstück, took our showers, and conked out for a couple of hour nap. Ah, bliss! By the time we got to Prague that evening we were rarin' to go, and never suffered from any jet lag.

So I get the idea of wanting a place to call home away from home for a few hours at a time: When you arrive a few hours before check-in time and even though you asked for early check-in, the room isn't made up yet. When you have to check-out and your flight isn't until late in the day. When you get off of a long overnight flight and want to clean up before your meeting. (I did very little international business travel, but I once had to go directly from Schiphol Airport in Amsterdam to a client meeting.)

So I get the idea.

Still, there's something a bit No-Tell Motel about hiring a hotel room for a few hours, something that puts the rack in rack rate.

Anyway, that's where my simple and dirty little mind lurched when I saw a mention in The Economist of a company called Globe. Their app lets owners rent out their homes - or just a room in their flat - by the hour. 

This San Francisco outfit didn't start out quite this way. 
The startup evolved from a previous iteration of the company, known previously as Recharge. Back then, its business model revolved around persuading hotels to let out their rooms on hourly or even minute-by-minute stays, but it was forced to adapt due to the amount of cleaning that was required between check-ins. (Source:
Minute-by-minute stays, you say. Talk about a quickie!

Anyway, once the hotels decided that the Recharge model was a non-starter, founder and CEO Manny Bamfo came up with a new idea: use the Airbnb model, only for hyper-short-term rentals. I'm guessing their aim at that point was to get big and interesting enough for Airbnb to purchase them. (Bamfo had worked for a prior start up, Hitch, which had a carpooling app. The company was acquired by Lyft.) 

So, Globe emerged in 2019 and was bouncing along - it had over 10,000 hosts worldwide willing to rent out a room in their home, when COVID-19 hit. Once everyone started sheltering in place and business travel all started happening via Zoom, there was a lot less demand for places where weary travelers could take a pick-me-up shower or enjoy a nooner with someone other than their partner.

And then another lightbulb went off, and Bamfo turned on a dime, repositioning their offering:
As people find themselves stranded away from loved ones, the startup is temporarily marketing its platform as an escape from the confines of home so that they can seek out better wifi or a quiet space to make essential calls.
Lemon -> lemonade. This is Smart Marketing 101. 

It apparently was working:
Since the coronavirus outbreak, the company reports, it has seen 25,000 new users worldwide. And in New York, there’s now a wait list of more than 10,400 people who want to become guests, according to cofounder Emmanuel Bamfo, no doubt fueled by coronavirus-related cabin fever. About 2,000 people have come off it and been approved to use the app, adds Bamfo, 30. (Source: NY Post)
Then in late May, Globe was hit with a "cease and desist" letter from the City of San Francisco which claims that the company was in violation of SF's shelter-in-place order. 

The letter sent by city officials to Bamfo and his fellow partner Eric Xu claimed that the startup appeared to violate a shelter-in-place order that it implemented in March:
...specifically that Globe’s Covid-19 specific policies do not go far enough to prevent the spread of the virus, and they have threatened to take immediate action.
Bamfo and Xu are said to have been left “shocked” by the letter and insist that their measures, such as cleaning checklists for hosts and customers having to send pictures of thermometer readings, are adequate. Source, back to:
I haven't seen any reporting on how this is playing out. Although I know that it sometimes doesn't seem that way, the pandemic won't last for ever. If Globe survives, it'll be interesting to see whether they pivot back to their weary travelers and/or tryst positioning or something altogether different. Seeing whether anything they do will be enough to get Airbnb to come knocking will be interesting.  A note to Airbnb: Just remember: if you hear rockin', don't come knockin'.

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