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The home-sharing start-ups coming for Airbnb’s throne

A crop of new platforms are promising more than just fewer fees. But can they really compete with the behemoth?

(Josie Norton/For The Washington Post)
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Nestled in Paris’s posh 8th arrondissement at the top of a four-star hotel sits a luxury apartment with floor-to-ceiling windows, Bang and Olufsen speakers and a stand-alone bathtub. It’s a property typical of those available on the Plum Guide, a platform that allows users to book stays around the world in homes that have been assessed according to 500 data points ranging from design to water pressure.

Plum Guide, which bills itself as the Michelin guide for home rentals, is among a handful of platforms that launched just before or during the pandemic in an attempt to take on Airbnb, the behemoth home-sharing platform that disrupted the travel industry when it launched in 2008.

But for all the change Airbnb ushered in, it is not without user complaints. Listings don’t always meet guests’ standards, and users have complained that unexpected fees can multiply the price of what initially seems like an affordable listing. Airbnb has pledged more transparency on fees.

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Home-sharing start-ups aren’t just trying to edge out platforms such as Airbnb. Hotels and resorts, which tack on pricey resort fees, also have left travelers looking for other solutions. And in a landscape where reviews on travel sites can be bought, consumers are left scratching their heads on who to trust and where value really exists.

“We’re going to see many start-ups that actually take advantage of the shortcomings of Airbnb, but are they really going to be a serious threat to them?” said Richie Karaburun, a professor at New York University’s Jonathan M. Tisch Center of Hospitality. “That’s going to take years, and that’s going to take lots of money.”

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Plum Guide, which hosts homes in 60 destinations around the world, does not have customer reviews on its site. Instead, the company has its own reviewers that assess listings before they are put on the platform. It then outlines “home truths” on each listing — for example, if the reviewers think the kitchen is well stocked or not, or if there’s enough dedicated living space.

“Our view is that reviews are exceptional at getting rid of bad actors, but are terrible at finding exceptional experiences,” Plum Guide founder Doron Meyassed said.

Plum Guide has attracted $57 million in funding, which helped the five-year-old platform make it to 2021.

Meyassed said the price you see on Plum Guide’s search results page is the price you pay, with the cleaning fees and taxes baked in. The platform offers a range of homes from about $150 a night to above $1,000 — and you can even find homes as expensive as $10,000 a night in Paris. Property owners set the price of the home, but Plum Guide has permission to reduce the cost if you find the same listing for a lower price on another site. The platform collects up to 15 percent of the cost from homeowners.

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Users can search on their own or use the platform’s “matchmaking” service, in which they can call or chat with an expert to find a property. The matchmaking service, Meyassed said, is among Plum Guide’s most successful features and results in higher rebooking rates.

“I think we forgot how nice it is to sort of download your needs onto another human being and for them to do the hard work for you,” Meyassed said.

Other booking platforms have touted their own quality-meets-value approach to travel lodging. Sonder, which announced in April it is going public and is valued at $2.2 billion, leases and manages apartment rentals in 35 cities across eight countries, cutting out hosts altogether. The company says this model allows it to maintain the quality of the listings “reduce operating costs versus traditional hotels by as much as 50 percent,” according to an April Medium post by the company. You can find some Sonder listings on Airbnb. (Sonder declined to comment for this story.)

Most Airbnb competitors are focused on solving “customer-service-related issues of price point, variety, geography” rather than the more painful issues that Airbnb faces, such as the quality of homes or host reliability, said Chekitan S. Dev, a professor at Cornell’s School of Hotel Administration. Sonder addresses quality control because it retains ownership of its properties, Dev said.

Smarter, a platform that launched in 2021 and as of now operates in London, says it saves customers an average of $400 per booking, with listings ranging from $275 to nearly $3,000 per night. The platform is able to charge lower prices, founder Guy van der Westhuizen said, because it works with professional partners who handle the marketing, customer service and other costs associated with managing the properties.

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“When a guest books a home through Airbnb or another major platform, approximately 15 percent to 20 percent of what they pay will go to the platform … ” van der Westhuizen said. “What Smarter does is we aim to significantly reduce the amount that the guest pays to the platform, so the fees that we charge are considerably less than that.”

Part of Airbnb’s advantage is that it has been around long enough to build tools for a more reliable traveler experience, the company said, which include host-identity verification, a law-enforcement portal, payment protection and property-damage coverage.

“Our unmatched global network, incredible host community, and comprehensive trust and safety tools — including identity verification, background checks on all US users, urgent support line, and in-app safety center — have made Airbnb a travel industry leader,” Airbnb spokesperson Christopher Nulty said in an email statement.

For all the growth in the home-sharing space, some travelers prefer hotels. But figuring out where to stay and how to enjoy a new destination can be overwhelming, and reviews on sites such as Tripadvisor or Yelp may be unreliable — at least according to Well Traveled Club, a membership service that operates as a hybrid social-media-booking platform.

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Entrance to the Well Traveled Club comes with a $150 yearly fee. When applying, an applicant has to supply their Instagram, website or LinkedIn, as well as information on their travel style.

Once approved, users have access to hotels, restaurants and activities approved by the club, can offer reviews, and submit recommendations for consideration. The Well Traveled Club target consumer is someone who is looking for something more elevated than a budget vacation, but still may not be able to afford luxury travel, according to co-founder Samantha Patil.

“Yelp is never gonna understand that I want to go to this hole-in-the-wall Chinese restaurant because it’s really popular on social media, but I also love a good steakhouse,” Patil said, referring to algorithm-based recommendation tools. “It can’t connect those two things together, so it’s never going to be able to serve you relevant recommendations — that’s the human connection piece.”

Well Traveled Club members have access to bookings in 45 different cities from Jackson Hole, Wyo., to Japan, with an emphasis on local spots and boutique hotels. During the booking process, the platform offers users incentives such as room upgrades, complimentary hotel breakfasts, dining and resort credits, as well as a booking credit to the site.

The Well Traveled Club membership fee is akin to the annual fee some travel rewards credit cards charge. But, Patil said, hotel partnerships or recommendations that come from American Express or Visa lack some insights that may appeal to design- or community-minded travelers.

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“We do have a bunch of members that use Amex and have Amex; [their feedback] is that it’s really clunky,” Patil said, referring to the travel booking services that American Express offers some of its cardholders.

But obviously there are benefits of long established rewards cards that start-ups cannot provide, such as points, travel insurance and the general protection it offers buyers on purchases.

Although there is room for niche players to enter the alternative lodging and short-term rental market, few are likely to match Airbnb’s size any time soon, making it difficult to compete on elements such as availability. Airbnb still has to fight to keep hosts and guests on its platform, either through rewards-style programs or incentives, Dev said.

“Airbnb, having such a huge first-mover advantage and having so many hosts … they have a huge scale of benefits that are going to be hard to replicate,” he said. “It is going to keep ahead of its rivals unless it really messes up in a big way.”