Inside Airbnb’s massive Olympic plans

There are only two months left before the Olympic torch and a parade of international athletes enter the Maracanã Stadium in Rio de Janeiro to open the 2016 Olympics.

And about an hour’s flight from Rio, in a new office in Sao Paolo, the nearly 20 Brazilian Airbnb employees are in crisis.

Back in March, Airbnb won an offer to become the “Official provider of alternative accommodation services” for the 2016 Olympics. It’s a mouthful, but it’s the first time such a title has been awarded at the Olympics. In scoring the praise, Airbnb beat local services Hotel Urbano (a vacation package selling site) and Alugue Temporada (a popular property rental site in Brazil and owned by HomeAway). Airbnb did not disclose the value of the contract, and Rio 2016 did not respond to a request for comment on the partnership.

“With visitors from all over the world, Rio residents can serve as diplomats in their home countries, welcoming a global audience with genuine, genuine Brazilian hospitality,” Airbnb co-founder Joe Gebbia noted at a press conference in Rio announcing the partnership earlier this year.

This is a radical departure from the 2012 Olympics, in which homeowners in London were threatened with fines if they attempted to rent their home to guests. According to Reuters, this is the first time that a major sporting event “has turned to the general public, and its additional rooms, to resolve a short-term spike in demand for accommodation”.

This year, visit the Olympic Games Ticket Booking website and you will see that booking a house or room on Airbnb is an official option. And Airbnb itself has an Olympics-themed landing page. And that’s about the extent of the partnership – on the surface.

The background to things is much more complex. Airbnb promised the International Olympic Committee that it would be able to provide more than 20,000 accommodation options. That’s a lot for a business that started in Brazil in 2012 with just 3,500 registrations. As a result, Airbnb has been adding shared homes, rooms, and full domains to its country lists – especially in Rio – at a rapid pace.

Pick up speed.

Managing that growth has been Airbnb’s new head for Brazil, Leo Tristao, a former Google employee whom Airbnb hired on Facebook last year. (He was also the general manager of Facebook for Brazil.)

Tristao immediately identified a startling complication – and we’re not talking about the country’s economic recession or the looming threat of the Zika virus. Eighty percent of the roughly 7.5 million tickets for the Olympics would go to Brazilians. Meaning: Brazilian hosts in Rio would be much more likely to serve as diplomats to their own compatriots than frequent globetrotters. This situation would be new for Airbnb Brazil. The World Cup audience – the most similar recent event and a potential test case for how these Games would play out for the company – was only 6% nationally. Thus, more than 90% of those needing accommodation were international travelers. And international travelers – at least frequent travelers – know Airbnb much better than Brazilians in general.

“Rio hosts are already used to welcoming international travelers in general,” says Tristao. “So we’re more concerned with local Brazilians – how to educate them and make it easier for them to book.”

Payment planning, hosting.

Considering the fact that Brazil is immersed in its worst recession in 25 years, opening up a variety of payment options to those who can afford to travel would be key. “Very, very key,” Tristao said.

There are unique systems in Brazil that the Tristao team wanted to be able to offer to locals. One of them: a popular debit card-like payment system involving credit cards issued by local banks.

There is also the Boleto Bancário. It is a method of payment originating and specific to Brazil. It is something like the bar code on an American check. So, to make a payment, for example, an individual must scan a Boleto merchant code on their phone so that the funds are automatically withdrawn from their checking account. Boletos can also be paid for at ATMs, local banks, or some supermarkets.

Also, says Tristao, “Brazilians love to pay in installments, so we had to make it available as well”.

In addition to the payments, Airbnb Brazil will need to educate hosts to be patient guides for those new to the process.

“It’s about showing our community the little tips from the moment a customer contacts them on the platform, through the reservation flow, to check-in,” explains Tristao. Its staff have trained the hosts to be very responsive and to answer all guest questions. “We want every customer to have a five star experience.”

He says that while interactions through Airbnb’s website may require additional coaching, most Brazilians don’t need any help with the “hosting” part itself. “Sometimes,” he says, “I joke with my colleagues that hospitality is in our blood.

Expanding geographies.

The slowdown may have helped Airbnb exceed its promise at Rio 2016: There are already up to 25,000 rooms available across Rio, 5,000 more than it promised.

“Brazil is in an economic situation which does not promote employment,” Tristao says euphemistically. He says Brazil’s sour economy has been a boost to many enthusiastic hosts, as renting a room can help generate additional income for families.

Rio is already Latin America’s largest market for Airbnb. Tristao says he is proud of the expansion within Rio in particular, as it includes many accommodations in areas not populated by hotels or generally visited by tourists.

And the company is happy with its economic impact: At the World Cup in Rio two years ago, it provided $ 38.3 million in revenue to local hosts. Considering Airbnb Rio experienced 87% year-over-year growth, this could, goddamn recession, be a really huge year for Airbnb Rio.

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