Airbnb goes mainstream with Rio Olympic contract

RIO DE JANEIRO (Reuters) – With an official contract to provide rooms for the 2016 Olympic Games in Rio de Janeiro, the online home rental market Airbnb Inc is creating a model for solving accommodation problems during mega- events, co-founder Joe Gebbia said on Friday.

The company, one of Silicon Valley’s most successful start-ups since its creation five years ago by a trio of graduates, will offer at least 20,000 rooms during the Olympic Games. Gebbia said it hopes to make those 25,000 or 30,000 rooms by 2016.

“We are helping cities expand their offerings and make better use of the resources they already have,” Gebbia said in an interview in Rio after the partnership was announced.

With Airbnb, a site where owners temporarily rent properties, Olympic organizers have found a solution to one of Rio’s biggest challenges: a massive shortage of rooms. It also eliminates some of the criticism that mega-events force hosts to build hotels for just a few weeks.

Airbnb has paid to become an Olympic partner and will be listed as the official accommodation provider with a link on the Rio 2016 ticket purchase webpage.

“When we started (our bid for the Games) the major problem was accommodation (…) and we started with the faith that we will solve the problem one way or another,” said Sidney Levy, chief executive of the local Olympic organizing committee, noting that Airbnb was a small business at the time.

Olympic organizers are embracing a trend that is already changing tourism, especially in Brazil. During last year’s FIFA World Cup, more than 100,000 people stayed in rooms listed on Airbnb. Hosts raised an average of $ 4,000 during the tournament, which lasted nearly a month.

Rio de Janeiro has been one of Airbnb’s fastest growing markets, the number of rooms has grown from 800 in 2011 to 20,000 now. The city has the fourth highest number of company listings, behind Paris, New York and London.

When it comes to quality control, Gebbia said Airbnb provides guidance to new hosts, while reviews help maintain standards. Renters are protected from fraud as long as they stay on the Airbnb website, he added.

Gebbia has dismissed the market chatter that Airbnb, one of Silicone Valley’s most discussed start-ups, may be considering making an initial public offering (IPO).

“It’s not in the cards at all. The focus is on growing the business. It’s the best use of our time right now, ”Gebbia said.

Additional reporting by Rodrigo Viga Gaier; Editing by Richard Chang

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