David Rosenthal: belief

Transcript context

…Yeah, let's do it. For folks who are new to the show, narratives are where we talk about what the media was saying when they had a bull case and a bear case for the company coming in. For me, the biggest bull case that I've heard is that they have the most unique supply of anyone in the industry that they spent a decade creating. They have this brand mote. They have 91% direct traffic that is largely a result of the fact that they did build that unique supply in a unique way to build their brand. Now, it's just about harnessing all of these unfair advantages. That, to me, is the big story here of why they're in their own lane of competition. They're not really competing with the bookings of the world who all are fighting for the existing hotel supply. Although they're trying to bring on the Airbnb-type supply too, that's the biggest bull case. I think maybe there are two other dimensions as well. I think that's probably the biggest piece, but one being that coronavirus and COVID has perhaps permanently changed some behaviors just like the part of the DoorDash ball case, perhaps, permanently changed more behaviors to be more favorable for Airbnb for travel. Not just in this period, but going forward. I think that might be a small part of this. I think the second piece is—also, we've talked a little bit about TAM along the way—yesterday, with DoorDash, that was one of the big question marks for DoorDash is how big is the TAM? Do they have to get into adjacencies, et cetera? I think, for Airbnb, what’s always been true here is that there are no questions on TAM. Travel is big and although it has taken a big hit this year, it's going to come back. Yeah. They cite a $3.4 trillion number on their TAM. I think the way they break that down is that $1.8 trillion of it is short-term stays, and then only $210 billion of it is long-term stays. The long term stay market—which is longer than 28-days stays—is actually smaller than the food delivery market, which I think is sort of an interesting comp. It tells you why they're not sprinting that aggressively toward long-term stays, but rather, they believe there's a $1.4 trillion opportunity for experiences, which explains why they're beating the experiences drum so hard. Let's just focus on that $1.8 trillion markets of short-term stays. They got a lot of room to fully saturate that.…

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