[theologic]

I'm struggling with the angle here.

A. The secret to AirBNB is that everybody had extra space, and Gig Economy allow you to get value out of your extra space.

B. When you are in the Gig Economy, you have two things that you need to do:

1. Have the extra space 2. Manage the extra space

Sonder initially focused on #2, and this worked out well. Bring professionalism to the management interface turns out to be very good deal because a lot of people with #1 is not good at #2.

My problem with the next step on their is that they are leaving the core of the gig economy.

Buying the facility and coming up with unique rooms with different paintings is simply getting into the hotel business. The fundamental driving force of the AirBNB business model is the use of an asset that is otherwise unused, and sparing somebody from needing to invest CapEx in building rooms. This is a massive lever to get into the hotel business, which is what AirBNB really is.

Obviously, I'm totally ignoring the moral choice of if having somebody else consuming and reselling beds is good or bad for cities. I'm simply on the point that hotels are a going business that is pretty competitive, with a series of operators at all levels. It's not clear to me how Sonder business model is superior to the standard hotel model once they are forced to spend CapEx for rooms, because having unique hotel facilities or rooms does not appear to me to drive a competitive advantage.

Secondly, if having unique rooms turns out to be brilliant competitive advantage, and I'm totally wrong on this point, I don't see how this drives a real moat (as Buffet would state) that is defensible. I would think that the entrenched hotel operators should be able to pivot and counter the threat.

[tptacek]

Isn't this really a kind of regulatory arbitrage? Hotels totally could buy up condominiums all over cities and then manage them centrally, but they're not allowed to do that. Airbnb gets away with it by distributing the liability and claiming plausible deniability; they're the Napster of hotel zoning.

Isn't Sonder just trying to slip in under the radar, the confusing ostensible aegis of people renting out their rooms temporarily, to do what Marriott can't do?

[theologic]

That's another angle I wasn't thinking of.

I'm no expert, but the Blackstone group and some REITS already focus single houses and renting them out. The REIT market is well understood, thus having a easy line of investors. If this is simply a way of getting past local rulings, I would guess that somebody in the aforementioned rental market buying single homes might explore short term hotel type operations instead, although it is unclear to me the leap from longer term rentals to overnight stays.

[JamesBarney]

> The fundamental driving force of the AirBNB business model is the use of an asset that is otherwise unused.

Two things makes me suspect their model is basically just an end run around hotel regulation, and not gig economy.

1. All of the airbnb's I've stayed in over the last year were dedicated airbnb spaces.

2. I know a couple people who rent 2 apartments, live in one, and primarily support themselves off airbnbing the other.

[citation_please]

Worth pointing out that "getting value out of extra space", in the long-term, only benefits property owners, as rents will simply rise to consume the generated surplus. Worst case being that if you want to live in a nice part of town, not only do you have to earn good money, but you have to become a part-time hospitality provider.