so Airbnb some interesting things are going on so Airbnb you know very well is awesome company one of the sort of most successful startups of the last decade or so and was about to go public this year and was preparing for it and now with coronavirus you know travel has stopped hospitality you know hotels casinos they're all taking a total beating and Airbnb of course is gonna
get caught up in the crossfire as well and so a couple interesting things here so Airbnb financially you know their revenue must have dropped by fifty sixty seventy eighty percent essentially overnight and with an indefinite time span we don't know how long this is gonna last the second thing is Airbnb not only does have a huge you know staff on payroll and now revenue drops but all
the hosts were essentially small small small entrepreneurs so some people did you know a traditional thing they just rented out an extra bedroom in their house but a lot of people once they got a taste of that money they started buying places renting out places and subleasing and basically putting it on air and bebe and so all those people now
there's this thing that was a moneymaker for a couple of years has gone to zero and so I think there's something very interesting that's gonna happen where what happens to all these hosts who got places just to Airbnb them and now the Airbnb income has sort of totally dried up are they gonna default on their mortgages are they gonna default on the rent payments if they're if they're
subleasing or are they gonna turn into just normal rentals I don't know what's gonna happen but what about all this so you already know what's going on in Zillow you're the one who told me right well I did see some charts yes so I saw some charts that basically showed on Zillow normal housing so just normal rentals not a short-term Airbnb stay but
just here's an apartment for lease for six months is exploding so like it looks like the coronavirus it's like here's last month one little blue dot this month fifteen blue dots on the map right it's like the number of listings is exploding for rentals which is also bad for Airbnb because in places like San Francisco where there's a house shortage and four years Airbnb has been
saying oh we don't contribute to the housing shortage we are we're a different thing altogether well now it's actually kind of a whether it's whether it's truly the the proof or not I don't know but it certainly does look like if you're somebody who was anti air B&B you have a lot of evidence a lot of ammunition now to say hey look when we turned air B&B off look at how
much more housing supply came on the market look how that lowers rents for everybody well you know what Airbnb is doing now though is long-term rentals they've been getting into that for a while where you could rent something for many months maybe many years and that part is growing so it's growing a lot right now right so I'm curious whether people in cities who are anti Airbnb are gonna
take this and run with it and yes yes very sensitive to legislation right they changed some rules here in San Francisco where it's like you can only do 90 days out of the year and you have to live in the place you have to prove that blah blah blah and that you know eliminated like 30 or 40 percent of the listings overnight when that legislation happened to your or to ago so now I wonder if
it's gonna get worse sander you know sander I'm googling them right now you know them know oh that's the like it's the hotel or explain saunder it's basically if you are traveling for work and you want to go stay somewhere you'll stay at asan der often let's see I'll go to sander comm it's also if you want to stay somewhere for like three months like let's say
you're going somewhere for three months and you want to and you have to make a lot of money in order to do this it's high-end like in San Francisco it's like five or six grand a month need a place to stay or work we know it's time here the better yeah the best parts of home and hotel so it's like a it's like a an apartment that you can rent for two months
right so the upper housing but done well yes but they just laid off 20% of their company it looks like wow yeah today so I think that's gonna be very interesting how these different companies get affected you know I'm rooting for Airbnb I think it's a great product I think it's a great company I hope that they have you know a war chest of cash that lets them endure this time but
you know we'll see it's a keeping an eye on it if you could invest a little bit of what you can you can go and buy secondary shares if you're gonna invest money at Airbnb z-- previous valuation I think they raised money on a thirty billion dollar valuation would you invest in that right now what I need to know more right I need to know about the how the company's financials look and
let's say that revenue drivers people let's say revenue dropped 70 percent for this I'm not so concerned about the 70 percent drop because that's that I think is is more temporary so I just need to know do they have enough cash in the bank to endure this or that that's three billion dollars okay so you've got three billion dollars you know they're
probably burning several million a month but like okay three billion should still last you through this time and then the other question is where the fundamentals good to begin with so a lot of times these companies don't have great unit economics or fundamentals to begin with and so when the downturn comes and people start looking for things that are more stable more sure bets these
high-growth but poor unit economic companies they struggle they were profitable in 2018 this is like a analysts call again I think they're also profitable in 2019 this is all public information right so yeah so if they're public if they're profitable right now even with this explosive growth and yeah it's probably a pretty good bet to pick up a little secondary there [Music]