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We've created a marketplace built on trust, transparency and authenticity

Not if this quote from the linked article is true, you haven't...

airbnb.com tightly controls the communication between host and traveler, disallowing the exchange of personal contact information until the point in which a reservation is already confirmed and paid for.

This information is correct.

No? It's built on. Controlling the communication is about avoiding "20% discount if you pay me in cash up front" scams, and yes, about protecting AirBnBs revenue stream.

It's a trade-off: This process enhances trust since you know your host doesn't get your money until you've checked in and found everything to be in order - and the host knows that the money is held and that he won't have to deal with late or no payment.

I don't get this focus on the personal contact issue. What exactly could the victim gain from having exchanged personal contact information prior to the booking, that he was unable to do after he got the contact information? He admits he didn't even catch that the guest misspelled his own name?

If someone comes from Craigslist, you can at least Google for their name, try to find a Facebook page, etc... BEFORE they enter your house. At best, the way it is for the author, she could have done some checking, but at that point the freak is already in her house.

No, after the booking is completed, still well before keys are handed over, personal contact information is made available. Sure, it's inconvenient if you have to turn someone down after researching them but after they paid, but that's hardly the issue here.

If effective protective measures can only be taken after the sale has been made / contract signed / whatever, then the marketplace really isn't providing "trust, transparency, and authenticity". In fact, it is actively working to prevent them.

But the author of the article makes a point to say this was too late a point in time, as they were already out of town.

He also writes:

If anything, I blame myself. In retrospect, and as I read through my initial email exchanges with Dj, I recognize now that something was “off” in his manner of communication, that I trusted too easily, and probably did not do my due diligence to properly protect myself and my home.

There is nothing in the article that indicates that the situation would have turned out any different if he had access to "Dj"s contact information earlier.

> If someone comes from Craigslist, you can at least Google for their name

You mean a name. Who says it's their name? The reason that we trust AirBNB and choose to host travelers is because if we do come home to find all of our things missing, AirBNB at least has a credit card on file, and can at least prove to the police that someone was staying at your place?

> AirBNB at least has a credit card on file

Might be stolen especially in the light of this case.

He could still have a fake Facebook account. Their method of trading contact info is not at fault.

IF they can catch this guy based on the information AirBnB collected when he signed up, then they're fine. If not they need to have a more strict membership sign up process so that if and when this does happen, the guilty can be made accountable.

Emotionally devastating story, but it seems like there is an easy solution to this. Have AirBnb contract include an insurance policy (superseding the homeowners insurance) for the time of rental. Also, have Airbnb keep credit card info on hand and hold guest responsible for any damage. Pretty standard business practices.

I've had terrible experiences while travelling extensively and staying semi-permanently where landlords do anything they can to keep your deposit, especially when you don't speak the language so well. I'd not be comfortable having a stranger be able to claim I made some kind of damage, and it become some kind of paypal-like black-hole of unwarranted claims. Ultimately reading this, I feel so sorry for the host, as a random, rare victim of a dehumanizing crime. It could have happened on craigslist, or via a friend-of-a-friend. Not to say that AirBnB doesn't need to address this, but holding a large amount in escrow like a car rental deposit would be offputting to me (with car rentals there is clear evidence, and you do a full inspection beforehand, though I'm sure it's possible to get burned on this).

But an insurance policy would further cut into their revenue stream.

A credit card number doesn't help much when you're dealing with anti-social elements (they'll just use a stolen one).

I would imagine that homeowners being terrified of having their homes trashed by guests would also cut into their revenue stream, and, if the "97% of airbnb guests are wonderful people" bit is true, the premiums should be fairly negligible.

At the very least, it should be an option for property owners to purchase.

Even if you do have homeowners / renters insurance, I wouldn't be surprised if most policies have exclusions for operating your home as a rental.

"But an insurance policy would further cut into their revenue stream."

If the value of the service is so low, and the risk so high, that it's essentially uninsurable, then perhaps that's a sign that it's a bad business model.

Or, it just means that the insurance industry has not caught up with a new innovation.

What about regular homeowner's insurance? Surely there can be policies that can cover this kind of thing which a host can obtain on their own. AirBnB doesn't have to muddy their business model with doing insurance, let the insurance people do this.

I think this case of unofficially renting out your house/apt is difficult to buy insurance for. Most homeowner's insurance policies explicitly exclude damages caused when renting your house. You need a separate landlord insurance to cover rental, but you typically can't buy landlord insurance unless your property is properly registered/licensed/inspected by your municipality as a rental property.

In many places the business facilitated by Airbnb is illegal. New York state, Chicago, and many other places have strict hotel laws that forbid these kinds of informal apartment rentals. It is extremely unlikely that any one can buy an insurance policy to cover an illegal transaction.

If you read the Airbnb TOS you'll see that they are well aware of this and are just hoping that naive customers don't read the whole thing.

I expect the original poster's losses will not be covered by home owner's insurance.

http://www.nysenate.gov/press-release/illegal-hotels-bill-pa...

There is virtually zero chance that a standard homeowner's insurance policy is going to cover an AirBNB-style rental. Rental insurance might -- I'm sure there are policies made for this -- but most people aren't going to have that kind of coverage unless it's bundled in some way with AirBNB as a value-add.

Um, then the anti-socials can just get a temporary/secondary card with a $500 or $1000 limit. Damage here sounds like it goes over $10000, it's not like you can put that kind of holds on people's cards for every rental you arrange.

At the risk of it being slightly poor taste to go down this tangent:

Given how rare this type of thing is, AirBNB could have a great extra source of income by offering optional insurance for an extra fee (similar to car rentals).

I imagine it's possible, but there's probably a whole mountain of paperwork and cost involved in insuring property in various countries.

Hey brian,

- what's your side of the story on being unreachable 14 hours after the event?

- did you offer AirBnB credit or compensation to the victim to stay elsewhere during this?

To be fair I doubt the victim would be comfortable receiving airbnb credit or using the service again. If this happened to me and I was offered credit, I would feel insulted.

Purely pulling this out of my ass, but I'm hoping whoever took his initial call(s) just severely misunderstood the situation. Maybe people have had trashy guests or items broken and became irate over them, and that's what this person thought was happening. I hope.

I don't know the company's "side of the story", and would be surprised if it was ever really discussed in any way aside from steps taken to remedy this situation... But as this suggests, they apparently need, above their "urgent" number, a "Bat-Phone" for severe cases.

That doesn't matter. They are obligated to investigate each and every phone call to their fullest extent. Only if the same person called repeatedly could they even begin to think about the "boy who cried wolf" excuse.

Sure, I just mean to say that a person calling the urgent line because someone may have accidentally pocketed a key and the homeowner is concerned, is reasonable. That should be investigated.

But the guy calling with a police report on his entire place being completely trashed? The calls for the support staff to have a Bat-Phone to someone at a very high level, if not the top.

Oh I see, that's even better.

This doesn't specifically answer your question, but the post does seem to mention that financial compensation from AirBNB was offered:

"They have offered to help me recover emotionally and financially, and are working with SFPD to track down these criminals."

TechCrunch is reporting I spoke to Airbnb about EJ’s situation. They won’t reimburse her for damages, they say, and they do not insure against losses. They are helping police track down the person who did this, but their help ends there.

http://techcrunch.com/2011/07/27/the-moment-of-truth-for-air...

I love that the entire investment community is gaga over this company.

So they sold a fad product (cereal) at the right time to make a little bit of money. Just tells me they have no moral integrity (which explains the craigslist email spamming).

So they struggled to make rent in SF a while. Who told them to stay in an expensive city with no savings? That's bad financial planning, and they could've bootstrapped their startup in Austin.

Oh, and they made a startup that is illegal in many parts of US, and manage to dupe investors to give them hundreds of millions. Now they won't even give financial help to a girl whose life they help tear to shreds.

Sounds like upstanding company/fellows to me.

How is cereal a fad product? What's wrong with catering to fads?

My opinion is that the service is questionable. The fact that there is no way to contact a person until they accept your credit card. My friend paid for the stay, contacted a person via website, the person replied yes and asked to call him to make arrangements. Ended up, that nobody realized that nobody can see contact information. The day was waisted. So when my friend wanted to delete profile from airbnb, it is not allowed. So all we could do was telling about the horrible experience. They do not have detailed terms and conditions on the site, and all what a person should be aware of. I guess that they really do not care about customers. Like I heard from other people, this is like a typical startup from silicon valley, a new bubble. I guess we need to look at that in a positive way. So they just need to get enough money to get a lot of advertisement. Nothing will kill a horrible product faster that a good advertisement.

I think it's presumptious to assume AirBnB owes anybody anything. The renter knew (or should have known, if not retarded) the risk she/they were taking. And AirBnB cannot literally be responsible for every single human being's action who is a party to their service. The person that, allegedly, trashed/robbed the place is clearly the person who did something evil and illegal. Blame the perpetrator, not a middleman or scapegoat.

You know, the problem is that unless AirBnB is willing to pick up the tab on this sort of thing, they dramatically increase the risk associated with using their service.

Regardless of their legal responsibility, I would think that it was in their best interest to pay up in this type of situation. For example, a guarantee of say $10,000 for any damages (which AirBnB can then try and recoup from the perpetrator) would go a long way to making people feel more secure about renting out their apartment. That, along with a warning to store personal documents off-site, would reduce this type of event to being more of a nuisance than absolutely destroying someone. I would even think that that $10k limit could be waived in exceptional cases like this one.

Thanks for taking care of it, also good to know they got a suspect.

What can you say on the 24/7 "urgent" line, which sounds like an important feature even for cases less dramatic than this one?

This seems to be the crux of the issue right here. When I heard the airbnb business model, this type of situation was the first thing that came to my mind. Airbnb absolutely does provide an incredible service, but these types of issues need to be solved. A 24/7 line should be step 1.

> When I heard the airbnb business model, this type of situation was the first thing that came to my mind

Same here. Great model, glad it works for some people, but the only price I'd take to rent out my house - with my personal items in it - is the price of replacing my house and personal items.

Exactly. No insurance will cover this type of transaction if the informally renting out your place is illegal in your locale. On top of that, you have to worry about your own safety. 99.999% of the time you'll be fine, but taking that risk is a very personal choice.

What I would like to see and would think would be a great win for AIRBNB, publicity-wise, is an offer to restore this person's stuff.

The difference between a hotel and a home is that while a hotel may be trashed occasionally by the drunk rockstar, there is nothing sentimental in the hotel room. Screening is not going to stop someone pathological from unleashing wanton destruction. Even ordinary renting out houses usually require some kind of bond to be placed to deter and filter out riff raffs. I wonder if AirBnB would ever do this because it increases the transaction costs dramatically. On the other hand, it is a nice cash "float".

Screening won't help, but a credit card imprint sure goes a long way.

Have you considered doing more to confirm the identity of someone?

Airbnb has done a great job so far, but I think there needs to be some more effort put into validating the renters information. There are several ways to do this via online identities, credit cards, etc. The other option I would definitely add is a specialized rental insurance of some kind. An additional $10/night across all rentals should help pay for situations like this along with the basic broken item situations that I know you deal with. Let the homeowners decide if they want to charge/pay that fee. Then it is in their hands if they choose not to.

Airbnb's review system sucks! Why are there no dates on any of the reviews? What determines the order of the reviews? In my experience, I've seen more recent negative reviews get pushed below older positive reviews. Why are we not allowed to sort the reviews by date or rating like on any other reasonable review system? This is the opposite of 'transparent'.

Although there have been negative PR effects for Airbnb due to this incident, it appears that they have benefited as well, by wisely using the lesson learned to improve their business by adding essential insurance and pre-deal inter-member communications services, among other things. The future value of that benefit to a start-up company most likely far exceeds the damages suffered by this host, assuming the PR issue can be positively resolved. There was no similar benefit for the host, unless you count the lesson learned that they should avoid the sort of activity your business is built around.

So here's a suggestion: acknowledge publicly that this incident exposed ways in which the service could be improved and offer to make this one host whole as compensation for that value. Solves everybody's problems in one fell swoop without accepting blame for something that isn't Airbnb's fault (and more importantly without resorting to blaming the victim - not the host's fault either). I'll bet it would cost far less than the usual media blitz companies commonly use to repair their images after incidents such is this. Consider it a good investment in the company's future.

Hmm?

http://ejroundtheworld.blogspot.com/2011/07/airbnb-nightmare...

(Discussion: http://news.ycombinator.com/item?id=2820615)

It's a lot easier to do routine stuff well than to deal with unique situations like this. AirBnB has done the latter, and has proven again that they're a great organization with excellent customer service. Congratulations and best of luck with resolving everything successfully.

i call bullsh1t on that.. havent seen airbnb do anything about this 'unique situation' that isn't contradicted at every turn...

A novelty account? Just to join the schadenfreude pile-on? How cowardly.

I am both a client and host with Airbnb and know from whence I speak. Airbnb offers a really great service, and the guys who founded it are genuine. Many learning experiences are painful, as was this one. Missteps are inevitable as a company grows. It's unfortunate what happened, and their response could have been more immediate. I think they will make steps to adjust and and protect their most important commodity, their hosts.