[dustinmoris]

> Try hiring hotels or hostels for large gatherings: bachelor/bachelorette parties, weddings, family vacations, etc. and I think it will be easier to see the difference. They compete more with vacation rentals, which seems old-fashioned since their online inventory always sucks.

I agree with you that AirBnb fits much better into that category. Having said that, I also frequently rent an entire chalet with friends for skiing and even then we use websites which cater specifically for those types of accommodation (especially in France there are so many good websites to book chalets) that the offerings on those websites exceed AirBnb again in every possible aspect.

Besides that, I don't think that investors have valued AirBnb at the current levels with the idea that AirBnb only caters to bachelorette parties and a few odd student gatherings. That market is not nearly as big as AirBnb is currently going for.

[alpha_squared]

I think the key here is the brand, which does go a long way. When traveling to a new place, I don't know what to look up to find whole-place rentals in the area and Airbnb is a default to finding what's in the area. In that way, Airbnb's value is in its listing/"aggregation" platform, not necessarily the listings themselves. After all, there's very little to stop a competitor from cloning Airbnb's model (and those clones do exist).

Personally, while I default to Airbnb's for finding stays when I travel, I've found myself gravitating back towards hotels as of late because they were generally better value propositions for what I was looking for.