Living in San Francisco can be expensive, and paying the rent can sometimes require an entrepreneurial spirit. That was certainly the story of Brian and Joe, who installed a few blow-up beds in their apartment and built a website called “AirBed and Breakfast.” This idea not only solved their rent problem, but later grew into the largest hotel chain in the world with a puzzling $30 billion market capitalization that continues to grow to this day. And yet they don’t “own” a single hotel.
air bnb platform
A new standard in business
Today, companies like Airbnb are the norm, rather than the exception. Platforms are the new standard, crossing industry boundaries and growing at an unprecedented rate, without owning many assets. Instead, platforms ‘parasitize’ on existing assets and connect supply and demand in a frictionless way.
This is the secret to the unprecedented growth that platforms are achieving. It’s all about scalability. Every time a host signs up, Airbnb’s inventory not only becomes larger, it becomes more diverse and attractive to guests. In turn, guests attract hosts, who attract more guests. This creates a cycle of growth known as the network effect .
growth airbnb platform
Airbnb, Uber, Apple, Facebook, Snap, Alibaba and Google. These companies follow the platform business model. But what distinguishes platform businesses from traditional companies or value chains? And is a platform a guarantee for success? Of course not. Precisely because you are parasitizing on other people's resources, the hong kong mobile phone number whole thing only becomes more complex. There are five puzzle pieces that you have to figure out first. I explain how.
puzzle pieces platform
1st piece of the puzzle: open platform infrastructure for matchmaking
You need an open platform infrastructure. This is the digital meeting place that matches both sides of the market: supply and demand. This should be as simple as possible. With Uber, this is by matching between passenger and driver based on location. With Tinder, this is done by simply swiping through a large number of photos.
The frictionless and simple connection between external producers (the hosts on AirBnB) and end customers (the guests on AirBnB) is the first condition for success.
2nd piece of the puzzle: external providers
The platform enables manufacturers to be part of something bigger with global reach and a consistently strong customer experience . Alibaba, for example, unites small Chinese manufacturers and takes on giants like Amazon and Zappos.