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The Moment Of Truth For Airbnb As User’s Home Is Utterly Trashed (techcrunch.com)
432 points by ssclafani 2251 days ago | hide | past | web | 226 comments | favorite



> I spoke to Airbnb about EJ’s situation. They won’t reimburse her for damages

This is bad news.

They're going to backtrack on this. The sooner they do it, the better for them politically.

I understand the problems of setting a precedent. And there really is no getting around the fact that the hosts do have the final responsibility for screening travelers (and travelers for screening hosts).

But rightly or wrongly, they're going to end up on the wrong side of this story unless they make things right for this gal and can tell Arrington and other journalists, "we've made sure our customer is whole."

After saying that, they can use this as a learning exercise for their community about how screening hosts and travelers yourself is important.

--

[Edit]: Is she in San Francisco? It looks like she is. She called SFPD. This is an easy one. Brian, Joe, or Nathan needs to be out there to provide a shoulder to cry on and an open checkbook to fix anything that money can fix. Nothing in that apartment costs more than the value of the ammunition this is going to give to their enemies.

The earlier they do this, the more quietly they can do it, which serves their purposes as well.

[Edit #2]: Some form of insurance might be a worthwhile addition to their offering, but that's something they can debate and decide on after they put out this fire. [added:] Also, insurance doesn't solve the safety issues involved here, so they're still going to need to emphasize the importance of screening travelers (and hosts) carefully.

[Edit #3]: EJ doesn't sound particularly litigious in her post, but consider what happens if she does decide to sue AirBnB and any part of it makes it to a jury. I mean, HackerNews is lining up against them. Consider what 6-12 normal people might decide. The wise move would be to make sure that she's fully satisfied with the way they treated her.

[Edit #4]: Arrington updated the article after speaking with Brian Chesky. Brian, Joe, Nathan and company did the right thing here, as you would expect.


I understand the problems of setting a precedent.

I don't, actually. If the financial industry has taught us one thing, it's that you can insure anything.

Let's assume that this is a very rare occurrence and that the total cost of making this right (say, tops $100k?) can be amortized over the profit being generated. I have a hard time understanding how it'd be rocket surgery to get something in place to handle these cases, especially just after a $112 million cash infusion.

Everyone keeps bringing up fraud, but fraud is nothing new to insurance and there are centuries of practices established in that industry for dealing with such – i.e. it will happen, it can be minimized by establishing premiums, requiring police reports, and, again, amortizing the cost of fraud over the spread of valid commerce.

[Edit replying to parent's #2 edit]

Sure, this one needs to be out of pocket. Actually, it'd probably be easier for them to insure now since there's a data point for how often this will happen per x number of rentals. Handling one of these out of pocket can't be a biggie for a company with several orders of magnitude more cash in the bank. And with a multi-billion dollar valuation, there will be institutional insurers that will be willing to build up a risk profile for them and work out a policy to handle these these things in the future.


Seconded... have a basic excess so it is not worth claiming for your tv, price in a certain amount of fraud, and investigate large claims. It's just the usual insurance.

There would be plenty of large insurers happy to insure AirBnB (and the reinsurance would end up down the corridor from me).


AirBnb is illegal in some of the states (and when states/hotel industry/cities get a wind of this story, it will probably be illegal in all the states), so I doubt any legitimate insurance companies will be handling this affair.


Aside from hyperbole about their legality now or in the future...

The way I suspect a deal would be structured is that the institutional investor would not be insuring the homes of Airbnb's customers, but insuring Airbnb against claims, with a process of validating those claims that involved sending out a third party adjuster.

I have full confidence in the insurance industry's ability to find a way to finagle a deal of this sort if there are enough zeros behind the dollar sign.


Let alone apartment complexes. The one time I used Airbnb the person whose room I rented told me I could use all the facilities of the apartment complex for free (laundry, exercise rooms, pool, etc. etc.). I'm sure the folks managing the apt complex would love it if they knew that was going on...


That statement doesn't seem based in logic: it doesn't follow. Lots of things are illegal in different countries, but that doesn't stop legitimate businesses operating in countries where such things are legal. For example, online gambling is illegal in the US, but that doesn't stop legitimate (US-headquartered) credit card companies dealing with online gambling companies in the UK.

Also, if it were indeed the case that AirBnb is soon to be illegal, it would make more sense for insurance companies to sign them up: the risk of AirBnb being shut down ought to reduce the likelihood that they'll need to pay out.


>For example, online gambling is illegal in the US, but that doesn't stop legitimate (US-headquartered) credit card companies dealing with online gambling companies in the UK.

you're talking about the things you don't know about. The US processors can't legally process payments coded for gambling (some gambling operators code the transactions as "groceries", etc... - this is how the things still sometimes can fly under radar )

http://www.egrmagazine.com/news/514743/mastercard-crackdown-... :

"implementation of America’s Unlawful Internet Gambling Enforcement Act (UIGEA), which bans the facilitation of online gambling by payment companies."


You seem to have misread my analogy.

I'm talking about US headquartered companies like Visa and MasterCard processing transactions for UK customers of UK (and Irish) online gambling companies; I do know about this, not least because I have an account on paddypower.com funded from major credit card companies like Visa and MasterCard.

The analogy is with insurance companies dealing with a business which is not legal in some states. That should not stop them dealing with the business in states where it is legal.


U.S. insurers are heavily regulated by the states. They aren't going to get involved in a line of business that appears shaky or is crossways with the political tide.


legitimate insurance companies

Sounds like an oxymoron to me...


No, most insurance companies are perfectly legitimate. You are confusing 'legitimate' with 'morally sound'.

Which is not to say I agree that that would be an oxymoron. A 'morally sound free market' or 'morally sound unregulated capitalism': those are oxymorons, because there is no imperative that causes unbridled competition in free markets to lead to companies doing 'the right thing'. Which is why we need a government to regulate stuff. How much of a government is a different question: there's a difference between supporting libertarianism and supporting anarchism and not even the most staunch libertarian disagrees we need a government for some things.


Insurance companies are immoral?

My employer and I pay $7,500 a year for my health insurance. I developed a debilitating back condition which required over $150,000 in surgery and therapy. My cost? Less than $1,000.

A friend of the family was killed in a tragic accident. He left behind a wife with a long-term debilitating illness and 3 children. Several life insurance policies paid sufficient monies that they have the financial resources to live their lives.


I assume this reply was intended for my parent, because I was not arguing that companies were immoral.

I do argue that companies are essentially amoral: outside of governments, the only force working on them is the pressure to survive in the face of competition, using whatever means needed to achieve that goal. The only reason companies generally behave in morally acceptable ways is by government regulation. Without those, monopolies on drinking water, oil and other essentials would be acquired and enforced by companies with armies. But the net effect of the current state of affairs is that companies generally behave in morally acceptable ways.


Such an insurance would probably be pretty much impossible. If you get a legit HTBRAI ( house trashed by random asshole insurance ), you've automatically created a market where these HTBRAIs are priced, bought and sold. That means you are essentially gaming burglary. eg. if I buy 100 HTBRAIs in some dicey neighborhood and there's an incident, my contracts automatically go up in value. That's a huge incentive for crime/arson/burglary.


you're mistaking the insurance with risk swap contracts, options, CDS and the likes. The insurance is when you own the interest in the property subject to the risk you're insuring against and the limit of the insurance payment is generally the amount of the actual market value/damage/replacement cost to your interest in the property. Thus it is illegal to double(triple...) insure in order to receive double(triple...) insurance payment. I.e. owning a 100K house you can't get 10 insurances and receive 1M when your house is burnt. You also can't get an insurance for your neighbor's house.

What you can, if you find a dealer, is to buy a risk swap contract that will pay you the contracted amount in the case of some house burnt or some earthquake happens or some bonds go south. This isn't an insurance in the sense of regulated insurance business. In stocks it is called options, in mortgage bonds it is CDS.


"you're mistaking the insurance with risk swap contracts, options"

No I'm not. btw i trade options & risk swaps for a living, so I had a good laugh reading your mini tutorial on "this is called option, that is called CDS" :) Anyways, there's lots of holes in your explanation. For one, you say it is illegal to double-insure. Not true. It is illegal to double-dip, not double-insure. So you can get health insurance for yourself from your employer & simultaneously be covered by your spouse's employer - this is quite routine and legal, though frowned upon. What is illegal is to bill both the providers for your expenses. Another eg. you double-insure expensive realty, so if one insurance provider goes out of business, you don't have CP risk. But if there's damages to your house, you can recover losses from only one provider, not both.

As an aside, much of this is enforceable because insurance is such a heavily regulated industry, so you have centralized databases & its easy to check if you are double-insured, double-dipping & other edge cases. With HTBRAI, assuming such a thing ever comes into existence, you'd need a framework for all that regulation to fit in, which is what I'm skeptical about. airbnb is a fine service and they have a sound business model & a solid future - these insurance wrinkles will hopefully be ironed out in due course.


It's an interesting point, but I don't see why it would be any different from any of the usual insurances (car, house, etc). A market based on life insurance policies which then incentivizes assassinations is a chilling thought, and strikes me as analogous to your scenario, but I don't think such a thing happens, right?


You might be surprised - see this : http://www.bloomberg.com/news/2011-05-16/death-derivatives-e...

Other examples in the entertainment industry - say there exists insurance that your movie will earn a minimum revenue say 25 million usd. Your competitor simply buys those contracts and then trash talks your movie on the opening night ( by simply paying out bloggers and amateur journas some pittance sum of money ). Your movie tanks and so the contracts get exercised and your competitor makes a whole lot of money. So the next time around, you make a shitty movie to begin with. Then YOU buy the contracts, wait for your shitty movie to tank and cash in the contracts! This actually happens sometimes in Bollywood, though not in the exact fashion I described but in a more shady fashion.


Reminds of the plot of "The Producers". Sometimes real life can be stranger than fiction..


"Spring Time for Hitler" ... it's sure to be a "HIT"


When people are planning to murder their spouse, then sometimes pressure them to get a life insurance policy. It doesn't look good if the police notice this.


Don't such policies exist, though? Homeowners insurance and renters insurance typically have options to cover burglary. I would argue that the risk here is not people gaming things on the market side, but likely the traditional route of filing a false police report and making a fraudulent claim. Ideally there could be an extension on existing policies for people who are going to be offering their homes on services like airbnb.

Edit: I should have scanned the thread


As was pointed out before, it's not possible to get insurance for this - homeowner's insurance specifically disclaims damage from renters, and it's generally not legal to rent your premises like this unless you comply with all the hotel rules, so AirBnb can't take out insurance either. All they can do is self-insure, and if they start paying out, people will realize "Hey, I can get a new TV if I let my friend come and trash my old one".

And yet your analysis of this particular case is spot-on. They stand to get CRUSHED by this story.

Damned if they do, and damned if they don't.


It should be possible. I see this as the exact same situation as http://www.getaround.com/, who are, according to techcrunch, "The Airbnb For Cars". They have a policy with Berkshire Hathaway that covers any damage to the rented cars.

You can write insurance for anything, if you're willing to pay enough premium. I can't imagine this premium would be that exorbitant for Airbnb to pay for it's users, just as Getaround does.


I don't see what they stand to lose if they take the same stance as homeowner insurers do— if you file a police report, they'll pretty much take your word for it.

In fact they have an even better guarantee, since they know (ideally...) exactly who the perpetrator was. They're not giving you the money to replace your stuff, they're lending it to you until they can recover it from the criminal. If the person who you claim did the damage claims they didn't, that's a problem they have with you, not with Airbnb.


Taking the same stance as homeowner's insurers do implies that they would be the insurance company. That's an enormous can o' worms.


Why? They insure one specific thing: a contract between two individuals that they trust. The only way they lose out is if they don't actually have any realistic way to enforce the contract on the renter— which would surely be a way bigger problem for their business than having to pay out some fraudulent damages?


"Some" fraudulent damages? If people figure out a reliable means to defraud you, they will do it until you fix the problem. And, congratulations, now your primary focus is fraud detection. You're now an insurance company.

There's also the fact that insurance companies are subject to many laws and regulations that other businesses are not.


You're missing my point— "Fraud detection" in Airbnb's case means "ensuring that owners and renters are who they say they are."

Surely that should already be a primary focus of theirs.


Why? And How?

Are they going to require faxing in photocopies of ID? Run credit checks? All this would do is to verify that a person with this information exists. This wouldn't stop a bad guy from using someone else's identification to register, and none of this addresses whether the renter has the legal right to rent the property.

And, once they are that deep in the process, if Airbnb is making any representations to their customers about this kind of vetting, then they are exposing themselves to liability if something goes wrong.

Right now, they are content to verify that the customer and landlord have valid credit cards / bank accounts, and that's that.


All I'm saying is that the due diligence to prevent fraud is the same as the due diligence to ensure somebody won't burn down my house for fun. Whether or not they can meet the standard, that's what they should be doing.


Ha, clearly you've never been robbed. Even if they know who the perp is, there is very little chance you will receive your items back unless they catch him down the street running with it.


"Hey, I can get a new TV if I let my friend come and trash my old one".

Fraud is a problem with all insurance policies. Deductibles and investigations go a long way to curtail it.

They can also set the premium high enough to cover the costs and get to claim that it's available if the homeowner chooses, even though most won't do to the high price. It's a feature that would make them stand out among their ever growing competitors.


>and it's generally not legal to rent your premises like this unless you comply with all the hotel rules, so AirBnb can't take out insurance either.

can UberCab happen here, ie. some zealous DA would come down on AirBnB itself and/or subpoena the records of people renting out?


Sure. I would think that sooner or later, the hoteliers in, say, Manhattan would start complaining about people engaging in hotel business without following the hotel rules. There's a financial incentive as well:

http://www.nyc.gov/html/dof/html/business/business_tax_hotel...

So yes, at some point I'd say it is likely that AirBnb's records are going to be used against their customers. Some of AirBnb's customers aren't breaking the law, but some are.


What AirBNB could do is help the victim sue the criminal for damages in court. Lend her the support of their legal team.

Of course, the odds that the criminal has anything left to take are low...


Airbnb is a brokerage for what is probably an illegal activity in a lot of places. The hotel industry is regulated for the same reason taxis are regulated. I love the concept of Airbnb, but I just can't see how it can really make it in the long run.

In this case, and in all others, Airbnb can not be responsible for this kind of stuff. Also, I highly doubt a homeowners policy is going to cover it because the person was renting out their place (again, probably illegally).


"The hotel industry is regulated for the same reason taxis are regulated."

Yes -- to drive up prices for the cartels who control entry into the market.


Yes, that is partially true. However, the major reason is safety and liability. I have spent quite a bit of time overseas, and jumping in some random car of questionable roadworthiness, with an equally questionable driver, is not really something that the average citizen should have to deal with on a regular basis. If you don't want hotels or taxis regulated, then perhaps the same could be said for all businesses, and housing (construction regulations), etc. If that is the case, then please be sure to be in Iran or Afghanistan the next time there is a major earthquake, and then tell me that regulation is about the "cartels who control entry into the market".


Well put.


Yes, I'm quite sure that's the sole reason any regulations have ever been enacted covering either industry.


well, not that i support these taxes, yet just for illustration, SF hotel tax is also a source for grants to arts and culture programs which supposedly make the City more appealing (again i have no informed idea about the effectiveness and alternatives to such a tax program)


Techcrunch is just the beginning. Douse this now. Ensure everybody knows that this experience was an outlier and that Airbnb exists for its users; make the girl whole.


> "we've made sure our customer is whole."

When it gets to personal things like "found ... grandmother's jewelry" and "I don't have the mental energy to take those last few steps into my apartment. It's too creepy in there anyway."

It's really hard to "make someone whole" with a cash payout. There's a lot of distress involved. It's not just a case of "TV was stolen, TV costs $500, here's $500". There's family heirlooms and emotional trauma involved.

Aside from that difficulty, you're perfectly right.


"we've made sure our customer is whole." - why do you assume this statement refers to monetary compensation?

Might be just me but i didn't read it like that at all.


It's hard to see what else you can do about destroyed family heirlooms.


I wonder who advised them against reimbursing her... their lawyers? It seems like a no-brainer.

I've been fascinated with AirBnB. I'm taking a week-long vacation in August and have been considering listing my NYC apartment to help offset some vacation costs. Their response in this situation totally turned me off from the idea. I'm sure I'm not the only one.


I will ask my lawyer girlfriend this question (IANAL), but based on previous conversations I've had with her, my bet would be that any reimbursement could be construed as an admission of guilt/liability, and could be used as evidence in a civil trial. (Consider the extra costs of a trial alone, plus the possibility of punitive damages for pain & suffering and whatnot if they lose.)


Your lawyer girlfriend would probably say that offers for settlement or reimbursement are usually not admissible as evidence of guilt.

I think the bigger problem is that if they reimburse this person they can set up an expectation that everyone will get reimbursed for damages to their home, and they cannot afford that.


Yes, correct. She said that it wouldn't constitute an admission of liability, just a bad precedent that could easily be abused.


Really? If they reimbursed her, wouldn't that make them liable for any other future incidents?


Two-sided marketplaces are perfect when all actors are reasonable, but upon mainstream adoption many services invite whole range of unreasonable actors. Services that exist in a known niche probably can't scale the way that mass-market services can, but the actors are probably far more predictable.


This is why AirBnB will never be the ebay of spaces like they aspire to be. Our personal spaces are always at risk with AirBnB unlike product transactions on Ebay.


Actually I think there are a lot of parallels with eBay. I remember the very early days of that service, when there was a lot of interpersonal communication, transactions were friendly, you could send personal checks without raising an eyebrow, etc. When it became mainstream, all that went away very quickly.

I remember the first time I got screwed on an eBay transaction I thought it was just a random, unfortunate thing -- "well, I've been using this a lot, I guess it was bound to happen." Then it happened again. Pretty quickly I realized that things were going downhill, and the trust I'd put in other users of the service was no longer reasonable.

I think that's the direction that AirBnB is headed, unless they take steps to intentionally restrict their growth and remain in a niche market. Eventually they'll have to do what eBay has done, and make the transactions as anonymous and automated as possible, and probably push all but the big commercial operations (who can absorb the fraud risk that gets pushed onto sellers) out of the market.

But the upside is, I think there's a market for services like AirBnB that are still niche. As AirBnB grows and becomes less and less pleasant to do business with, and as the risk involved in every transaction grows (as it did with eBay), there's an opportunity for someone to create a competitor that's tailored to a specific niche market. Or maybe one that's built on top of a social network, so that you're always renting from a friend of a friend or something. There are a lot of possibilities I could imagine.

But AirBnB seems to be going for mass-market adoption and I think that's the death of a friendly, trusting community if it involves money.


The article has been updated with information from Brian Chesky where he clarifies that AirBNB have offered financial compensation and are trying to go "above and beyond".


At the least, I hope someone starts a fund for this girl. I'd contribute. This is a terrible story.


Makes me think— Who says someone else has to insure Airbnb? Let's say they add an invisible $1 insurance fee to each booking, that goes into a fund to pay interim damages only when an actual crime is committed.

Cases like this are so rare, and although the damage is horrific to one person the dollar amount is trivial on the scale Airbnb operates. Seems like a perfect case for a shared risk pool that actually works rather than insurance.

Then they could peg the cost of the insurance fee at a realistic share of your risk, and the theoretical cost of someone trashing the place would be built into the cost of the room.


This opens Airbnb up to the risk of significant insurance fraud. Insurance companies have the infrastructure to deal with it, but Airbnb doesn't - and presumably doesn't want to build it.


Their attack surface is way, way lower, though. Airbnb would only be insuring the contract between two parties that Airbnb knows, so they're lightyears ahead of homeowner's insurance when it comes to recovering money from a claim.

Fraud would mean the owner having an accomplice renter who destroyed something, Airbnb compensating the owner, and then being unable to track down the accomplice for redress. That's only a problem if a significant number of renters are able to use Airbnb without Airbnb having any way to track them down.

And if that's the case, they already have a problem.


An accomplice renter - or destruction or property - isn't necessary. The owner can just claim theft, at which point it's their word against the renter - "They stole my HDTV!" "There was no HDTV to start with!"

At that point Airbnb is put in an impossible situation - they either pay for what may be fraud, or they refuse to compensate what may be actual theft.


I don't get it. They require you to file a police report, just like insurance companies do. In fact, since they know the identity of the renter, they can require that the renter's name appears in the police report, and Airbnb can call the police station themselves to follow up with more information. A claim against the fund necessarily means pressing criminal charges against another individual.

So as the owner, it's my word against the renter with the cops involved. They're going to figure it out eventually. Maybe I'd be able to float a few grand for a while before it caught up with me, but surely there are easier ways for me to turn false testimony to my advantage than screwing over the web site that's earning me money?


I'll freely admit I don't know that much about insurance fraud. But I suspect the majority of people attempting fraud wouldn't be loyal Airbnb customers, but rather people of questionable ethics who hear that if you go to such-and-such website, and file a claim, you may end up getting some money. If there's any weakness in Airbnb's insurance system, given the scale at which Airbnb wants to operate, people WILL find and exploit it.

It is, of course, very possible to set up insurance so it has few loopholes - insurance companies do it! My point is simply that it's not trivial, and Airbnb would have to invest significant resources to make it work well - while still potentially failing to gain the goodwill they need (few people actually LIKE insurance companies).


Simply integrate this with a rating or flagging feature. Make it strict -- one 'dispute', such as this, and you're on watch. Two in a short time frame and you're banned. etc. They can afford to pay for a couple of HDTVs so a couple of smart guys can profit off the service, and the legitimate users can keep on legitimately using.


This is precisely what insurance companies are for. Airbnb gets insured, it's customers file claims with Airbnbs insurer when things go sour.

Insurance fraud is no joke and it takes a hell of a lot of stupidness to attempt it.


The problem is, as other commenters have pointed out, the activity facilitated by Airbnb is illegal in an increasing number of states. I'm sure that complicates insurance.


If the premiums were juicy enough, an existing insurance company could cobrand with them to offer it. They can also limit their liability with a cap on the damages covered.


I would kickstart a little for this.


I remember I had difficulty contributing to Kickstart since I'm in the Netherlands.

Is there someone here that can set up a Paypal account for this gal? I'd happily donate a few $.


I would imagine this would be a situation that homeowners insurance is for. But I bet homeowners insurance won't cover damage caused by running your home as a hotel.

If not, then Airbnb should have some sort of insurance for these situations. Can't have all of the upside and none of the downside.

Not to mention if this happens a few more times, Airbnb's business model will be legislated away.


As above, airbnb already exists in a kind of legal gray area. There are very few places where it's actually legal according to municipal/zoning rules to rent out rooms this way. Not to mention the significant legal intricacies incumbent in offering insurance to consumers like that.


Agreed. And the laws should either be changed or enforced. I don't fault Airbnb for that.

However I don't agree that because there are legal intricacies a company valued at over 1 billion dollars shouldn't protect its financial future.


In the UK one needs specific landlord insurance for this situation.

I expect that unless you rented out your space a lot in a given policy year, it may render it unprofitable to do so.


Most mortgages in the UK have the condition that you need to inform the lender if you are letting the property and there may also be requirements for electrical and fire safety.

I hate to think of the potential liabilities if someone got injured in your home and you didn't have the right insurance.


I'm not even sure that the precedent it'd create is a big issue. They'd be as much paying to shutdown angles of bad press as anything else and this is so volatile because it's the first big story along these lines for them, it's beyond a basic theft and it's emotionally written. Future incidents probably won't contain those three elements.

Down the track, they can say "Sorry, that other time was a once-off, we have many T&C/suggestions that cover what's happened" and the victim is going to have to be unnaturally persistent with the press to create a story this damaging.


I'm reminded of PayPal's early days when fraud was a big problem (and probably costed a lot more than a trashed apartment). If AirBnB handles the risk well, it may well set up a high barrier of entry to other me-too enterprises trying to do the same thing.


"I spoke to Airbnb about EJ’s situation. They won’t reimburse her for damages, they say, and they do not insure against losses. They are helping police track down the person who did this, but their help ends there."

...

Fuck. That.

I don't care what the long-term implications are, I don't care about precedent, I don't care about policy, I don't care about cost.

If my business does this to someone I make it right. Even if that means going into my own goddamn pocket. Anything less is simple villainy.

If you are going to enjoy the rewards of your business, you have a moral obligation to ensure that you make things right when that business harms someone else. And let us be clear: this is harm. This isn't "oh dear, my careless guest spilled wine on my TV. Buy me a new one guys."

This is "the guest you sent me destroyed my home and sense of safety." This is completely beyond the pale, an incredible stretch no one, clearly, bothered to imagine. Crucially: it's completely documented by law enforcement.

If it's true these guys aren't going to make this right, Airbnb is dead to me. Fuck Obama O's, to hell with their Cap'n McCains, and all the struggle that earned my admiration. I'd say that to their faces, I'd say that if I worked there, and I'd quit if I worked there and this wasn't made right. This is a test of human decency. I hope they don't fail it.


"This is a test of human decency. I hope they don't fail it."

Technically, they've already failed it. Now they just have to admit that they failed, and actually fix the problem (financially). If this was my company, a "worst case scenario" money chest and an itemized plan-of-action would've been the first thing I created. Investors are protected (in a number of ways) from the financial risk of investing in Airbnb (or any company); the clients should have a similar expectation of security, considering that they're creating the value for investors.


> Technically, they've already failed it.

The book isn't closed on this yet. I don't know these guys personally or anything but hearing Brian Chesky talk about his company and his struggle, you can tell that these guys aren't assholes. Right now they're getting stupid, shitty, short-sighted advice from people who've convinced them to do the wrong things.

I want to believe they'll turn it around.

If they don't... well, as I said.


Where do we draw the line on decency?

* Guest trashes the place, takes off with host's camera, iPod, laptop, jewelry - should AirBnb chip in for the cost?

* Guest scratches a hardwood floor that's pretty expensive to fix - should AirBnb chip in for the cost? Or just buy a rug to cover it? What if it's some Mongolian oak that's custom-ordered at $5000 per sq.ft.?

* Guest overflows the toilet, causing some floor damage and a call to plumber - should AirBnb pay for just the floor? Or cover plumber's visit?

* TV is not working on guest's departure, guest claims to never have touched it, owner says it worked perfectly before the guest arrived - should AirBnb just buy a new TV?


I'm willing to go on record as saying the line is drawn at a sociopath willfully destroying someone's home and stealing their identity.

It's pretty simple. If the user can't pre-screen and validate the guest's identity before renting, the onus is on Airbnb to ensure that they will not destroy your home.

Besides, that's the only way this company can work at scale. Without trust in the system, who will use it?


Your reactions here are completely emotional. This is understandable, since the story is about a potentially emotional topic, but your response to it is not helpful for making a rational business decision.

Try to divorce yourself from the topic and read your reply again, realizing that you've set up an impossible standard and blanket-judged a complicated balance of liabilities as "pretty simple."


No, that is not where you draw the line. That is a random point very much on the far side of where you want the line drawn.

The problem for any organization dealing with a large volume of possible cases is that you need to figure out where to draw the line. Preferably you want it in some place that is transparent and easily communicated to people. Otherwise you'll have an endless stream of cases close to the line with arbitrary outcomes that you can't explain.

Clearly, "So and so drilled through my walls to steal my stuff" should be on the far end of the line. Clearly, "So and so stole my pencil" should be on the near side of the line. But where do you draw it in the middle? With the claim of a broken TV? With a hole in the wall?


There are databases for convicted felons and molesters, but other than that, how exactly do you ensure someone is not a "sociopath willfully destroying someone's home and stealing their identity"?

Even if AirBnb had a way to check this guy out, it's quite possible he doesn't habitually destroy homes and steal people's identities.


> There are databases for convicted felons and molesters, but other than that, how exactly do you ensure someone is not a "sociopath willfully destroying someone's home and stealing their identity"?

Dunno. That's going to be Airbnb's problem to solve if they want to enjoy ongoing business. That's their job if they want to be the "Ebay of spaces."


Actually, it isn't. Airbnb job isn't to guarantee the sanity of its renters to homeowners. They merely provide the interface for that interaction. I've been burned on ebay deals before (none of this magnitude, of course), but I don't place the responsibility solely on ebay for all of those -- in a few cases it was because I was trading with someone who was in another country, or had a low seller rating, etc. In situations like these, where you are putting your faith in a complete stranger, it is up to you to do your research and protect yourself. Sure, I think that there should be more on airbnb about the risks homeowners are taking on (as in, craigslist style), but to say that recognizing their limited responsibility in this incident would be "villainous" seem overly sentimental to me


It is definitely possible for the host to pre-screen and validate the guest's identity. I've used AirBNB as a guest before and I was screened by hosts. They asked questions about why I was in the area, whether I smoked/drank, etc. I told them my name, allowing them to look me up on FB, Twitter, find my personal blog, etc. You'd better believe I looked up their names as well to make sure I wasn't inadvertently staying with someone who was a felon.

If your argument is based on the assumption that hosts can not screen guests then your argument is wrong.


>Where do we draw the line on decency?

"If damage incurred through malice or gross negligence exceeds a reasonable proportion of the overall value of the establishment" where reasonable proportion might be defined as anything from 0.5% to 5%. The cool thing about legalese is how it can define a whole lot of undefinable things.

I am not a lawyer and never will be.


> I don't care what the long-term implications are, I don't care about precedent, I don't care about policy, I don't care about cost.

Do you care about your company continuing to exist for more than six months?

If you ran AirBNB and paid out to this girl, you would probably be flooded with similar complaints and legal assaults.

You'd feel great about the several people you helped, but then you'd be looking for a new job.


>This is "the guest you sent me destroyed my home and sense of safety."

Not to mention the theft of personal documents and potential theft of identity. The (very real) potential of being bushwhacked by additional fraud years down the line due to this incident is pretty horrifying.


What would you have rather AirBnB done in this situation? Do you not think it's a little unreasonable that AirBnB would have to take on the role of the insurer here ?

People should know the risks they're taking in letting a complete stranger into their house without even meeting in person. Just because someone found you through AirBnB doesn't mean you can take the risk for granted. You're still letting a complete stranger have access to your house and belongings.


> What would you have rather AirBnB done in this situation?

Make their user whole with a big fat wad of cash that approaches the value lost in the described crime. Relocation assistance. Go completely above and beyond.

> Do you not think it's a little unreasonable that AirBnB would have to take on the role of the insurer here ?

In general? Sure. Here? Absolutely not unreasonable. This is the absolute worst case scenario. The only way you top this is burning down a house and killing someone's dog.

Airbnb did not plan for this and did not appropriately set expectations. What they did set expectations for was "an Ebay of spaces," a safe and orderly way to monetize your home. The victim here argued very persuasively that because you can't contact people before the transaction, the onus is on Airbnb to ensure that they aren't sociopaths who will destroy your home and steal your identity.


No, the worst-case scenario would be that guest copies keys, returns, and rapes and kills the owner/occupant.

Remember: once you've allowed physical access to your resources (computer, accounts, home, ...), all bets are off with regards to future security.

AirBnB has a pretty intractable problem here.

People aren't fundamentally vettable. It's an age-old problem. TSA, the HUAC, lie detectors, loyalty oaths, pledges, blood bonds, FICO scores, PGP webs of trust, are all attempts to solve that problem.

We can identify, authenticate, predict, track, audit, and prosecute.

We can't know the future.


Worst case scenarios could come when the host is the lunatic.


> No, the worst-case scenario would be that guest copies keys, returns, and rapes and kills the owner/occupant.

The keys problem is fairly easy. I don't have keys. I enter a 4 digit number to enter my house. Just install something like that and change the passcode when the guest leaves.


Whoa.

Good point.

Shit just got real. Thanks for creeping me out even further.


The risk has always been there. Have you ever seen/used a lock-pick gun? They'll open anything non-specialized in less than a second. Failing that, a lightly skilled (50h practice) lock-picker can open most household locks, even "secure" ones, in under fifteen minutes.

Beyond that, the lock/deadbolt/wall is pretty weak. A sledge hammer will open almost any door in a single blow. Windows are essentially just big gaping "serial-killer's enter here" signs, as you can easily break them and gain access to the domicile. Where, presumably you would feed on the brains and organs of the residents.

And worse, the phone company publishes a book that lists your name and address. No longer do serial killers need to drive endlessly, trying to stumble upon a Stuart or a Fred, they can just pick up a phone book and they'll find a perfect list of people, indexed by name for easier killing.

PANIC!

But seriously now, you're over-reacting here. These risks are everywhere and AirBnB was just another way to meet another person.

What I'll consider unethical is if they do anything differently for this lady, who got the media attention first, than they'd do for anyone else.

I don't necessarily think they're liable, even morally. It depends on how they represent themselves. If they purport to offer screened participants and don't, that's a problem. But if they don't it simply means they're offering a lesser service, pay accordingly.

I want a market to exist for cheap and potentially dangerous things instead of offering only padded kid-safe versions. For instance, Lithium-polymer remote-controlled vehicle batteries. Essentially the same tech as the laptop/cellphone batteries that occasionally catch fire. But they don't have protective circuitry built in to prevent this. If you overcharge them they will catch fire. But they're far cheaper and you can draw more power than if they had safeties built in. If you're clear about the trade-offs what would cause a recall and lawsuit in one market can be perfectly acceptable in another.


Entry certainly isn't the problem.

Authorized entry is, and in the case of AirBnB you've got a case where someone's contracted for entry, may have notified neighbors / building management that strangers will be present, etc. (though "hey, strangers will be present, would you mind looking in on things might have been another good practice for EJ).

Your points on locks are very well made, and there's a long Internet (and pre-Internet) history of attempts at censorship by lockmakers against picking methods.

Phone books? How archaic. I don't have a landline -> no phone book entry. My information might be accessible elsewhere, but my perimeter security systems are quite good, and Krell steel resists mosts assaults.

Your idea of "unethical" (to say the least of good business sense) is markedly different from mine.


> Your idea of "unethical" (to say the least of good business sense) is markedly different from mine.

I'm sure it'd be more profitable (and thus good business sense) to treat customers better based on the publicity they have. But do you really consider that ethical?

> Phone books? How archaic.

I wondered if someone would nitpick that. :)

But do you remember when lists of people's name and address were common and people weren't all chicken-little about it? I wonder if Terminator changed that with its phone-book directed killing spree.


I really don't understand why the victim would say that it is not possible to contact people before the transaction, because as a user of AirBNB I have talked to hosts before and exchanged details about who I am, including full name, location, age, etc. The hosts had enough information to look me up on FB, find and read my blog, my HN posts, and whatever else they felt like looking up about me on the internet.

It is completely possible to vet your guests before accepting them. Now granted I do agree that it would be very kind for AirBNB to compensate her for the damages she suffered, but I do not feel like AirBNB should be held responsible as if they caused this to happen, because they certainly didn't prevent her from looking up this rogue guest before accepting the transaction.


It's not unreasonable, it's their business model.

Airbnb is built on smoothing over the process of renting your house to a complete stranger. If they don't have a solution or even a process for the possibility that a complete stranger will trash my house, they just lost a huge part of their value proposition.

I don't think anyone is saying Airbnb is legally liable— just that they should take responsibility for their own sake.


> Update (from Tech Crunch): I spoke with Brian Chesky. He says the company has offered “to assist financially, find new housing for the host, and anything else she can think of to make her life easier.” He says they intend to “go above and beyond” to make the situation right for her.

Good man.


Give me a frigging break!

I don't care what the long-term implications are

Clearly you’re not a business person if you wouldn’t care what the long-term implications of your company’s response to this were. They have responsibilities to investors, employees, and other users—they’re (rightly) making a decision with those stakeholders in mind, not the woman who had her house ruined.

I don't care about cost

Again, clearly you’re not cut out to run a business if you don’t care about cost.

If my business does this to someone I make it right.

Airbnb didn’t do this to her. The people who did it to her did it to her. Airbnb provides a marketplace for these interactions to occur—nothing more. The users cannot abdicate their personal responsibility not to use the service carelessly. I mean, we’re talking about letting people into your home here.

Is a car manufacturer liable when a driver runs over a jaywalker because they were texting on their phone? No. Is the phone manufacturer liable? No. Should I be sued when I recommend my accountant to my friend and the accountant defrauds him? No. Should Craigslist be liable if precisely the same thing happened through Craigslist? No.

Anything less is simple villainy. This is a test of human decency.

Calling this villainy is one of the most hyperbolic statements I’ve heard in living memory. So is declaring, as if it were agreed upon fact, that Airbnb is evil if they don’t reimburse her.

If you are going to enjoy the rewards of your business, you have a moral obligation to ensure that you make things right when that business harms someone else.

If your company actually does something to somebody, then sure—but not when you’re company doesn’t. Airbnb didn’t do anything to her: she let a stranger into her house for a week without thinking about it! I’m not blaming the victim, I’m blaming the people who did it to her—but I’m certainly not blaming the middleman.

What happened to this girl sucks, but your post is overly emotional and absurd. It’s not Airbnb’s moral responsibility to do anything about this. They may choose to from a pragmatically-motivated customer relations, reputation, and corporate image standpoint—and sure, it would be an all-around charitable and nice thing to do—but I completely disagree with the claim that they have any moral responsibility to do so. Airbnb can do whatever they damn well please and what they believe is in the best interests of their business.

What I think is indecent is creating an artificially high and illogical holier-than-thou moral high ground divorced from the realities of running a $1B business that you then use to drum up a public crucifixion of a company that doesn’t live up to said standard.


> Clearly you’re not a business person if you wouldn’t care what the long-term implications of your company’s response to this were.

Doing the right thing is more important than making money. I'm really glad I learned that before earning my business degree.

I'll tell you a story.

A couple of years ago, during the height of the financial crisis, I decided to quit a pretty safe job, move across the country, and focus full-time on building and selling iOS apps.

Just before the move, with cash tight, I shipped a new app.

It was doing... so well. A nice bit of press, good placement in the App Store, and revenues like no other project had yet produced.

There was just one problem: sometimes, you could enter a shitload of data into the app – and then it would crash without saving. A lot of work lost. Not all of the time, just enough to make you suspicious of the app. And as a result, a worthless tool.

The fix was very easy. Absurdly easy: one line of code. An over-released object. But Apple doesn't work quickly now and definitely didn't then. I had a choice: two weeks of selling what I knew to be a worthless app or destroy all my momentum and pull the app until the fix was ready.

So I pulled the app. Lost the high ranking that would have led to even more sales. Donated all the sales from that first day to a worthy cause, since I couldn't issue refunds. Fuck, did I need that money.

But I never looked back. Because it was the right thing to do.

You profit from creating value. If you do harm, you take responsibility and put things right. Anything less is unworthy of your humanity.

That's it. If my passion for doing the right thing makes me bad at certain things, oh well. Money comes and goes. My conscience is with me until I die.

> What happened to this girl sucks, but your post is overly emotional and absurd. It’s not Airbnb’s moral responsibility to do anything about this.

Sorry you feel that way. We'll never have common ground to work together. Good luck!


You’re patting yourself on the back for not selling a buggy app to people? That's a completely different situation than that in the story at hand. Airbnb worked precisely like it was supposed to—there were no bugs. It’s just that Airbnb is in no way supposed to prevent things like this from happening.

If you do harm

Again, you’re not addressing the simple fact that you’re working from the assumption that Airbnb itself did harm here. They simply didn’t.

Doing the right thing is more important than making money.

Clearly Airbnb does not believe that doing so would be ‘doing the right thing.’ You’re simply calling them evil instead of recognizing that they have a different—and quite defensible—point of view concerning their responsibility.


> there were no bugs.

The utter destruction of your home at the hands of a service that aims to help you monetize it is ipso facto a bug. Intent: create value. Result: destruction of value. Bug! It would be like a roach trap that helped roaches breed instead of killing them.

It's pretty simple. You can't talk to guests until the transaction is consummated. If that's so, it's on Airbnb to make sure that they're not sending a dangerous creep into your arms.

They failed in that task. If they want to be the "Ebay of spaces" then they need to provide for some basic level of safety and security.

It's okay that you and I have different value systems. They're incompatible, so we won't ever work together.


The utter destruction of your home at the hands of a service that aims to help you monetize it is ipso facto a bug.

Again, Airbnb didn’t destroy her home. Are you under the impression that someone from Airbnb itself was the one staying at her house?

Intent: create value. Result: destruction of value. Bug!

You’re basically defining what you want the responsibilities of Airbnb’s service to be and then faulting them according to those responsibilities. But those are not Airbnb’s responsibilities. Again, Airbnb doesn’t claim to prevent things like this, therefore it’s not a bug.

If they want to be the "Ebay of spaces" then they need to provide for some basic level of safety and security

No they don’t. There will be business consequences for not doing so, but they don’t have to. They can define their service to be whatever they want it to be. As it currently stands, their service is not meant to prevent this from happening.

They're incompatible, so we won't ever work together.

This came through loud and clear the first time you patronizingly said it.


Conveniently, you fail to address the point upon which this whole issue is predicated:

"You can't talk to guests until the transaction is consummated. If that's so, it's on Airbnb to make sure that they're not sending a dangerous creep into your arms."

No one thinks anyone from Airbnb blew up her home, dude. I'm not paid well enough to know if this meets the standard of tortious negligence. Yet it was negligence. Had she not used the service, she'd be fine now.

And, I mean, if you've got such a boner for the business side of this, in what universe can you trust a service like Airbnb now? You can't vet people until you're locked in, you have no recourse if you get screwed. This is a business problem, without the morality of hey, it's a good idea not to bring harm into people's lives.


Actually, I've used AirBNB multiple times -- hosts CAN talk to the guests... but it's done through the AirBNB messaging system which actively removes real identifiers such as email addresses and phone numbers.


I can back this up. I've used AirBNB before as well, and good hosts generally ask for some details about you before they approve your request to stay in their home. They generally ask a few background questions, why you are visiting the area, etc.

You can tell them your name, and they can look you up on FB if need be to do a background check. It is false to say that AirBNB does not allow hosts to communicate with guests, and it is fully possible for hosts to check up on the background of their guests.


Well, you haven’t addressed any of my points, but that’s fine. To answer your question, just because the transaction was consummated doesn’t mean she had to let the guy into her house. If the dude was suspicious or ungoogleable, she could have called Airbnb and explained the situation or she could have simply not left her key. Instead she just got on an airplane without thinking about it. That’s not Airbnb’s fault.

And you’ve just illustrated my point perfectly: if she hadn’t used the service, she would be fine now. But she used the service of her own volition; nobody forced her to; and she made the decision herself. Airbnb might have made the gun the guys used to trash her apartment with, but Airbnb isn’t the one that fired it: she pulled the trigger. Again, the people who trashed her apartment committed the crime here, though.

This is a business problem

I never said it wasn’t a business problem—that’s exactly what it is. But it’s not an issue of morality.

in what universe can you trust a service like Airbnb now?

I would never in a million years use Airbnb. Why would I leave a complete stranger alone in my house so that they could trash it and go through my things? You realize how insane that is, when evaluated outside the reality distortion field of the startup craze we’re in right now, right?

I think the genesis for your arguments is your desire to live in a world where you can trust a service like Airbnb. But if you just think about it for five seconds you realize anyone could do this and Airbnb in no way prevents it from happening. Just because Y Combinator funded it doesn’t mean it’s magical.


"Just because Y Combinator funded it doesn’t mean it’s magical."

It doesn't? jk. But seriously, if you mention airbnb to an average person, say anyone in my family on the east coast they haven't heard of it. So, airbnb isn't even big enough to have the problems craigslist has had with scams...but, this is just the start.

Once airbnb gets bigger there will be more of these stories. Someone will build up a rating by renting a few low priced places and then just completely rob a more expensive place.

I guess they should have seen this coming but now it's time to accept they are getting big enough where the common criminal will look to exploit the service. "You mean I just rent a few places and then some rich person will give me the keys to their place and I can take whatever I want? Awesome!"

I mean it's terrible, but I think we can all imagine it's possible someone using airbnb to rent a room in their home getting killed by the renter.


I think you're both right. Like most major crises, this one occurred as a result of not one "bug," but two or more bugs occurring simultaneously.

The first "bug" arises from the fact that AirBnB is much like a pay-for-play dating service, with all of the flaws of that business model. They have to control communication between the parties to keep from being cut out of the revenue loop... which means that they indisputably need to accept some responsibility for conducting the due diligence that they forbid their users to conduct. That's expensive and risky at best, but if they don't step up to the responsibility -- which they don't -- then they don't deserve to succeed. A stolen credit card should not be enough to gain access to someone's home for a week. Cases like this provide the necessary publicity to call attention to the unfair bargain they offer hosts.

The second 'bug' was the almost unbelievable naivete on the part of the host. She was, or should have been, aware of the terms of AirBnB's service and the limitations of their liability, because she would have had to agree to those terms and limitations when she signed up. It shouldn't take a law degree to understand that AirBnB's terms are ridiculously inadequate when situations like this arise. The idea of turning over the keys to your home to someone you've never met, based on the inadequate assurances and warranties offered by AirBnB, sinks to the level of incompetence IMHO. Not everyone will agree, but come on... if what she did isn't "asking for it," then there's no such thing as "asking for it."

To me, it seems clear that the responsibility for allowing this incident to happen falls on the host's shoulders... but at the same time, AirBnB should not be lauded for trying to play it both ways. If they're going to do everything they can to prevent hosts and renters from doing ordinary due diligence on each other, then they also need to stand behind their decisionmaking process when they approve a renter. I think a mandatory insurance policy has got to be part of the answer, just as common sense on the host's part is also a requirement.


This. I definitely think this entire situation calls into question the feasibility of Airbnb’s continued success and their business model in general. They’ll need to find some way to address these problems to maintain confidence in the site, and as the site’s audience grows it may not even be possible to do so.

I don’t dispute any of these things—my only real point was that it’s completely off-base to call Airbnb immoral for not compensating the woman.


Yeah, I don't think they owe her anything, given that they never misrepresented their terms. But I also agree with those who argue that they should help her out as a gesture of goodwill. Sounds like they're indeed doing that.


"You profit from creating value."

I really wish more people, especially SV-esque startup people, approached business this way.


Personally I don't know why people get a hard-on about the story of Airbnb.

So they sold a fad product (cereal) at the right time to make a little bit of money. Just tells me they have no moral integrity (which explains the craigslist email spamming).

So they struggled to make rent in SF a while. Who told them to stay in an expensive city with no savings? That's bad financial planning, and they could've bootstrapped their startup in Austin.

Oh, and they made a startup that is illegal in many parts of US, and manage to dupe investors to give them hundreds of millions. Now they won't even help a girl whose life they help tear to shreds.

Sounds like upstanding fellows to me.


I really don't understand why people are laying blame on AirBNB for what happened to her. AirBNB did not help the criminal destroy her home. On what basis do you make the statement that they helped "tear her life to shreds."? The fact that they helped her list her home and conduct business with this individual? That is like blaming the ISP for allowing a DDOS or a malicious blackhat attack on a server.


I'm sure they wouldn't employ someone who reacts in such a hot-headed manner so quickly. Keep in mind this is the first time this has happened to them, that they've probably never been placed in this sort of situation before, that they most likely exercised a bit of intelligence and consulted a handful of advisers, and that they are trying to take the wisest steps in handling this.

I doubt they're that soulless and cold-hearted; and if you'd just waited a bit, you would've caught Brian's response explaining how he plans on helping her out financially.

You're the one failing on human decency due to your inability to exercise even a shroud of empathy for these guys. They're trying to play it smart while still doing what they can to help.


When someone first told me about AirBnB I immediately dismissed it - just like Fred Wilson did. It fell in the group of ideas which I just find puzzling because the concept is totally alien to something I would want to do/buy/participate in.

I don't get why anyone would want to rent out their couch or spare room to a transient stranger - even 'vetted' within a community (and we can see that vetted is very lose here).

Sure, I sort of get the appeal for the renter but I'm lost as to why a homeowner would want to do this - especially considering the risk/reward here. The upside is a few dollars here and there, the downside is $10k's of damage - like this.

If you've never owned a house, you won't know that it's a labor of love and something you invest more than just your money into. Why you would want to risk someone destroying it, I don't know.

AirBnB needs to offer insurance as part of the deal - just like the car sharing programs seem to have negotiated their own insurance for the duration that the other person is driving your car. Otherwise it just seems an unwise risk to offer accommodation on AirBnB.


There's an increasing trend toward startups that disintermediate between traditional providers / purchasers.

eBay and Craigslist were early instances. I'd count eTrade and other online trading startups as another instance. Blogs, generally, cut out the middleman in publishing.

There's couchsurfing.com, various direct-lending startups, etc. And now AirBnB.

Some of these are fairly low-risk activities.

Craigslist, having been in the business for nearly 14 years (the domain was registered 11 Sept 1997) have a prominently displayed and long list of ways to protect yourself against fraud, including very explicit warnings and suggestions. It smells very real. And there are still a ton of posts to the feedback/help forums asking / warning / telling of scams attempted or perpetrated. And a few notorious headlines.

Startups especially like to portray the world as consisting of mostly nice people. This may be the case, but the exceptions to that rule can be, well, exceptionally bad.

Close family friends run a B&B. They've done it successfully for nearly 30 years, and have mostly good stories to tell, as well as some cool celebrity guests. It takes a mindset, especially when you're inviting strangers into your house (their current setup has separate guest cottages), and it's a lot of work.

Ultimately, AirBnB is going to have to look at whether or not they want to put a bunch of rank amateurs in touch with one another (with the inherent risks), or serve as an intermediary for more established entities (much eBay and CL traffic is now through at least semi-official dealers and brokers).

I can think of some explicit steps EJ could have taken to protect herself: having a storage locker and moving valuables off-site would have been a good first step. Meeting the guest another. Some sort of in-apartment surveillance, at least of entry an exit areas, a third. At the very least this would help track the perp / establish whodunnit.

AirBnB could self-insure or take a guest deposit of some sort (possibly encouraging credit-card fraud) against such issues. I suspect they'll have to or fold with the publicity of this story.

One of the lending companies I spoke doesn't assume systemic risk (based on credit scores and such), but does assume all risk in the event of identity fraud. This would be a very good model for AirBnB to follow. Bruce Schneier has long railed on how credit card / debit card fraud proliferates in large part because banks bear little of tye risk (most falls on merchants, some on cardholders).

This will be interesting to watch.


Thank you for a rational response to this. This is far from crippling for AirBnB; if some of these things haven't been worked out yet, then there's no reason they can't handle that.

The main damage will be from the publicity from this story. Now there's at least one cement example of somebody suffering greatly, that fear will penetrate anybody who uses this service from here on out.


Well, AirBnB certainly didn't create the idea that someone would rent out their home to a stranger, they just made it easier. My grandparents were renting out ski houses in Tahoe for a few days at a time 50 years ago.

And a few hundred dollars? The people I rented from in Paris were pulling in over $4k a month through AirBnB per property and they owned several.

If they simply charged a refundable deposit against damages like your average vacation rental, made people sign a damage contract and AirBnB secured the identity so you could prosecute someone if they destroy a place completely, a lot of these problems would go away.


Insurance probably requires a hotel reception-like presence (person on site, cam surveillance, security coverage, signed contracts, in-person ID validation and a way to prove who did what in case something bad happens).

I can't imagine any insurance company signing up for insuring "rented your home while being away" guests at rates that would be considered affordable for the rental model, nor a lot of AirBnB audience willing to turn their property into a de-facto hotel establishment.


If an insurance company won't write a policy for it, you probably shouldn't be doing it.


I can't wait to use this line.


If everyone followed this rule, there would be very little innovation, none of it disruptive.


I found this very glib, while we may mock insurance for certain things there are professionals in that industry.

If an insurance company specialising in unconventional insurance don't think they can make money out of a premium, that does actually say something pretty insightful about the risk you're taking.


The professionals in the insurance industry specialize in estimating the risk associated with any endeavor. Innovation, especially disruptive innovation, is extremely risky in the beginning and is almost always perceived to be riskier than it is. This does not mean that it will stay risky forever and perceptions certainly change. Innovations that go mainstream become progressively less risky.

If you'd like a specific example, consider that insurance companies in 48 states can and will likely cancel insurance policies of anyone who rents their car to another individual, even if they hold a separate insurance policy to cover it[1]. This means that the tens of millions of cars sitting in garages would never be shared even if a startup decided to insure those doing peer to peer sharing.

GetAround, which won the TechCrunch Disrupt audience prize last year, or RelayRides which does the same thing, would never have started if they followed this rule. It's a bit early to claim that they have changed the world for the better, but I am optimistic they will.

I think what I said may be somewhat pithy but I certainly wasn't being glib.

[1] http://travel.usatoday.com/news/2011-06-17-personal-car-shar...


You're arguing against yourself here - GetAround obtained insurance even while being disruptive.

More to the point, neither GetAround or AirBnB are in any way deep into territory that insurance hasn't ventured before. Insuring against burglary/damage in rental properties happens all the time, just like for rental cars.

The only times when insurance is unattainable is when the risks highly outweigh the premiums (SEE: Flood insurance in the Mississippi Delta) or when there is no actuarial data available which is tough to come by at this point.

For the first point I'm going to say the parent is very correct in avoiding this type of un-insurable behavior. And as for the latter, you had better have deep, deep pockets because if you can't even convince an insurance company of the risk, are you sure you've thought it through?


I am not arguing against myself. People had been trying and failing to get insurance for car sharing for decades before Getaround succeeded at it. My co-founder is one of those people. Yet, even today, if you become a Getaround subscriber, your insurance company can cancel your policy. If that doesn't convince you about the slow moving nature of insurance companies, I don't know what will.

I know of few disruptive markets for which actuarial data sets are available.

Obviously you should think through the risks of starting a business not endorsed by insurance companies. If you have an appetite for such risk and believe the rewards (to yourself and/or to society) outweigh the risk, you should do it. Do you think Google could have bought insurance for their self driving cars before they started working on them?


Here's what homeaway has to say about it:

http://community.homeaway.com/docs/DOC-1357


this sound like an opportunity for an insurance company to me. i'm sure they can come up with a rate..


> The upside is a few dollars here and there

I am an airbnb host. If the upside were a few dollars here and there I wouldn't do it. The upside is 60% to 120% of my rent every month. I imagine it could put a similar dent into a mortgage.


"When someone first told me about AirBnB I immediately dismissed it - just like Fred Wilson did. It fell in the group of ideas which I just find puzzling because the concept is totally alien to something I would want to do/buy/participate in."

I felt the same way about Ebay. How would you guarantee you didn't get junk shipped to you by some individual who changes his ID every day? How would you make sure that the top bidders actually go through on their agreement? The whole things seemed shaky. But it seems to have worked out for them.


What they do is in my eyes the opposite of professionalization, AirBnB and Getaround are already done with hotels and rental cars.

It's like growing vegetables in the backyard.


Before you all rush to judgment again, notice the update at the end of the article:

"Update: I spoke with Brian Chesky. He says the company has offered “to assist financially, find new housing for the host, and anything else she can think of to make her life easier.” He says they intend to “go above and beyond” to make the situation right for her."


Sorry, but the moment of truth has already passed because the moment of truth was when Airbnb didn't bake effective safeguards against this sort of behavior into the very heart of their website for lending your home to complete strangers.

Honestly, if you explain the business model of Airbnb to any ordinary run of the mill US citizen not residing in Silicon Valley, their very first question is going to be, "Why would I trust a stranger in this situation?" Airbnb's response was a joke in their FAQ about a grand piano.

It shouldn't have been. I have rented vacation apartments in Europe and there are plenty of ways to do this RIGHT, starting with identity exposure. There should have been a set of procedures for people to identify and vet one another BEFORE completing the sale. Of course this would have meant that some Airbnb customers would cut deals directly with one another and screw Airbnb out of its revenue share. OH WELL. Safety has a price and a clever entrepreneur would devise incentives - rental history, quality public feedback and ratings - to discourage people from going outside the system.

This isn't just one incident Airbnb needs to respond better to. It exposes a deep flaw, not only in their systems for preventing these types of incidents but for responding to them as well (it took 14 hours and a friend's intervention to get a call returned from the "urgent" hotline, wtf?).

What is especially infuriating about this is that, in an effort to bolster their income statement and become a hot company, Airbnb has created very bad publicity for a FANTASTIC and growing form of lodging.


Renting your home remotely seems different to how I saw AirBnb in the past, where you would be renting a spare room and living with your guests. I think that would be more supported, especially given 76% of the US population is Christian, and hospitality is a Christian virtue (in particular, Hebrews 13:2 Do not forget to show hospitality to strangers, for by so doing some people have shown hospitality to angels without knowing it.)

Lending your home as a holiday home already has well-established range of estate agents, cleaners and so on, (like Gîtes in France) so it can be done but relies on a more active role of the company organising the rentals.


It may just be that Breaking Bad is back in season, but it sounds like she unknowingly rented her house out to be a meth lab with cooks who probably used a bunch of meth in the process.

> The death-like smell emanating from the bathroom was frightening (and still is) and the bathroom sink was caked with a crusty yellow substance. Various pairs of my gloves were strewn about


Wow, I only thought grow-ops and meth-labs were limited to actual rented houses, but I guess AirBnB and the like can take it to a whole new level.


Not too likely for a grow house since that takes a while, but meth is quick. If that's what this was, I'm sure it's not the first time (and won't be the last). It's probably a better scam if you don't destroy the place.


I found it ironic that the renter's 'name' is Dj Pattrson when I read this in a related article:

"This week, New York Governor, David Paterson, signed a bill outlawing the use of private dwellings as makeshift hotels."

http://techcrunch.com/2010/07/25/fawlty-logic/


Conspiracy theories anyone? Maybe someone from the hotel industry sent somebody to do this?


How long before AirBnB offers some form of insurance, much as ebay started offering buyer protection.

Related: how long before your home owner / rental insurance specifically excludes AirBnb type activities?


On the 2nd point, most already explicitly exclude sublets and unlicensed rentals. Not directed at AirBnB, but due to shenanigans that have being going on for much longer. The short-term stays thing is relatively new (and largely popularized by AirBnB), but unlicensed rental for longer periods has long been common, especially in college towns, and insurance usually wants no part of it, especially in college towns.

(From what I understand, Couchsurfing is closer to a gray area, because of no money exchanged. Having a guest visit is considered a normal use of a home, and it's not clear if an insurance company could successfully argue that Couchsurfing guests aren't "real" guests.)


Insurance for what though? What if the guest steals the host's identity? What if the guest physically assaults the host? It only takes one of these to fuck things up.


Your home owner / contents insurance almost certainly doesn't cover you for this, and never did.

Letting a stranger stay for a few nights in exchange for money is not novel to Airbnb, and will be excluded.


IMHO AirBnB is no more responsible than CouchSurfing.

Whilst AirBnB charges a fee, that's purely as middleman for connecting two parties.

Of course it's horrific for the person, and this is an extreme example, but it's a lesson learned of how to rent out a property.

Take AirBnB out of the equation, and they've just let a complete stranger free reign over their apartment with a key for a week whilst leaving their own possessions on view.

To not ask a neighbour to hold onto the key, or meet the person beforehand, or get them on video chat, or remove all sensitive documents, or require a deposit, or a way of monitoring the property, is negligent on the owner's part.

Could AirBnB do more to vet users? Sure. Should they be responsible for the combined actions of two parties? Not at all.

A tough, hard-learnt lesson for the owner.


AirBnB's model depends on the two parties not being able to contact each other before a purchase is made. This is a restriction that does not happen on Craigslist, and as such, I'm able to vet just about everything I need to know about a candidate renter before he/she even knows the physical address of my place. For those prospective renters who don't have any real online identity (and decline to provide any other kind of info, such as proof of employment), I don't respond to their emails.

This is something you can't do on airbnb, so it's not at all fair to compare using their service to letting just some stranger in willy-nilly.


You can totally message a person before being made — I personally don't rent out my rooms to anyone who hasn't messaged me first and I at least got a bit of personal information. Or do you mean messaging via email rather than through Airbnb?


The only blessing in this story is that the miscreants made their damage so plainly obvious that the problems were identified quite quickly.

If they'd been a bit more subtle and a little patient, they could've engaged in massive identity theft and financial fraud without ever making it clear that AirBNB was the attack vector.


I was just thinking this. Presuming most AirBnB users rent regularly, you could quite easily swipe some jewelry (stuff at the bottom of the box) before anyone notices. Even if they do notice, they might go "I wonder where they went...?" and not even figure it was theft for a long time, if ever.

Even if theft was presumed, not only would multiple users have been in and out by that time, but you'd have no way of proving who took it, let alone have enough for the police to get a warrant. It sounds like the easiest money in the world.


In this case, wasn't a door broken in order to steal the jewelry? I'd assume most people take at least this level of precaution...


In-house door locks aren't very secure, usually.


The only blessing is that the person renting the property did not return early. If she had and had caught the renters in the act, who knows what would have happened.


How about something like concealing cameras through the house? There's so much potential for dangerous and creepy behavior.


AirBnB will lose control of the narrative if they frame this on narrow legal liability grounds: they are too large and well established and will be judged by a very different standard than is this had happened a few years ago. This will be a part of someone's advertising and PR campaign, either AirBnB, a plaintiff's attorney, or a hotel lobbying group. AirBnB looks like they are mindful of the legal liability and oblivious of the public goodwill risks.


So I definitely got partly scammed in NYC a few months ago by a friendly-seeming girl who found an apartment for the weekend on AirBnB and then promptly turned around and posted it for sublet on Craigslist as her own, raking in thousands in cash "security deposit" money from a number of un-suspecting apartment seekers.

I love Airbnb but there are so many loopholes for disaster like this. As Airbnb goes mainstream, I expect there will be many more similarly unhappy stories on their way...


I feel really bad for all involved, including AirBnB. They must feel awful, and this is obviously incredibly stressful. I agree with the consensus that they have thus far failed to use this as a marketing opportunity (a la Tylenol) or even to mitigate much of the damage.

That said, I would be absolutely fascinated to learn how this is playing out. It would be a huge service to the community for someone to release a blow-by-blow timeline from inside the company about all these responses and the thinking behind them. I have enough humility to know that they have a lot of really smart people thinking through this stuff, and it's likely much more complicated than we all realize. I'd love to hear about that thinking.


Why on earth would you feel bad for AirBnB? They're not paying out any money, they're not taking any responsibility, and for that they are receiving a lot of negative reaction. If you feel bad because they are getting negative reaction, that is ridiculous. They are simply reaping what they've sewn in this instance.

They could be out there making this right but instead they're hiding in their offices. Not even any meaningful words. A check for some reasonable amount of money accompanied by some nice words would go a long way. Something as simple as, "We were appalled by this story. I wish words could convey how deeply the AirBnB team regrets that this crime occurred to one of our customers in the course of an exchange that was arranged through our service. Please accept this check that we hope will cover most of the physical damage to your belongings along with assurances that we will be looking into exactly what we can do to mitigate the possibility of this ever happening to anyone using our service."

Anyway, don't feel bad for them, that's ... misguided.


I suppose I take a sympathetic attitude in general, but it's heightened because these guys are doing something I, and other people around here, aspire to. In a relatively minor way, I relate to them, and as I said I bet they feel awful. I don't feel as bad for them as I do for the victim, obviously, and I agree that they haven't handled this the way I might have. But having something you've worked so hard on lead to something like this because of some random asshole kids must be really, really frustrating and upsetting. You can sympathize with people without agreeing with them.


I'd been hoping those AirBnB pricks would be cratered for having built their business on spamming, not for something like this.


AirBnB is one rape case away from disaster.


murder would be worst...serial murders that get turned into a movie(i.e. the craigslist killer) especially


Am I the only one that would have presumed that AirBnB would not be financially responsible? They're a forum for helping people find short term tenants. They can't possibly vet everyone who's going through the system.


Of course they're not financially responsible. That doesn't matter. "We encouraged you to do something that wrecked your home and sense of security, but we didn't accept liability, so we're off the hook." It's legally true, but it's atrocious PR and bad karma.


I feel the same way.

That said, unlike Craigslist (and other forums), they do take a percentage of the cut.


I own a summer home and I was genuinely considering using Airbnb next year. No more.

I can understand that they can't be too forthcoming, as people will trash their own place in hopes of a free remodel.

However, if law enforcement says this is a legit case and even caught a suspect, Airbnb should have had someone onsite with a check in their hands the next day. How much amazing free press would this have generated for, what, $25k? Even if they offered $5k to get her place livable again they could have demonstrated some integrity.

I don't know how much money they think they saved by betraying one of their business partners, but they should debit 5 or 10 years of my waterfront rental from that amount...


The part in here about the FAQ really burns, now more than ever. Language used regarding renter protection should be as forthright and above-board as that used in payment checkout. Just the facts.


Will someone steal my grand piano?

Highly unlikely. Grand pianos weigh thousands of pounds and do not fit through doors.

That's just unacceptable. Regardless of whether this ever happened to EJ or not.


I'm all about startups having a sense of humor and personality. I think that their mistake is not following their answer up with something like this:

"But seriously, you rent at your own risk. Make sure to lockup or move all valuables to a friends place. If there are any problems, contact us 24 hours a day at XXX-XXX-XXXX"


I agree with you, its perfectly OK to set a tone and personality for the site – but that information to me is critically important to users of Airbnb and why to this day I haven't used Airbnb. It never seemed clear what would happen in this event and now we know. You are on the hook.

FYI In her blog post, EJ points out that Airbnb also lacks a 24 hour customer support phone number.


I think certain parts of FAQs can breathe a bit more and inject humor. Others can't. Payments, renter sec., etc are sacred ground. Funny is a disarming quality; you want these sections to reiterate strength, confidence and professionalism.


Agreed, but having a sense of humor is fine until it becomes reality.


...and rather than update the answer to reflect the traffic they'll be receiving to that question, they just removed it.

I guess they're still in hope-this-goes-away mode.


Arrington reported on her blog post and didn't get his facts straight about the financial help. What he quoted as an update was, in fact, already stated. The impression he gave of airbnb's indifference was unfair.


Big discussion on this tragic situation here: http://news.ycombinator.com/item?id=2811080


Lets see if YC changes this title too...


For future reference, title is currently:

"The Moment Of Truth For AirBnB As User’s Home Is Utterly Trashed "

Previous submission's title changed from:

"AirBnB: Crimes committed against a host"

to

"Violated: A traveler’s lost faith, a difficult lesson learned"


It may be significant that the changed title on the other article is actually the title of the article; the older title is not. (Unless someone persuaded the author to change the title on their own site as well as changing here...)


pg often asks people to change the title if they're editorialising. I posted the Nissan Leaf campaign page with the title "We don't need Flash(TM) anymore for anything ever!" and he emailed me and said "don't editorialise in titles" and changed it to "Nissan Leaf".


The counterargument here being that blog post's title was so generic sounding as to potentially not bring enough attention to the importance of the issue. The HN submission's original title didn't misrepresent the contents of the blog post in any way and helped attract more attention to the issue.


That was basically what I said to pg - "I'm not want to tell me HN buddies about the Nissan Leaf, the interesting part is their use of HTML5 video to create an ad campaign that would have traditionally been the domain of Flash(TM)".

pg's response was that if I want to share an editorial opinion about something, other than just posting the title of the page, then I should blog about it and then post a link to my blog.


Seems like a good compromise would have been "Nissan uses HTML5 instead of Flash for their new Leaf campaign"


Here's an algorithm you can use to predict that for all submissions. If the link here has the post's original title, we won't. If it doesn't, we'll replace it with the original title.

http://news.ycombinator.com/item?id=2814665


Here's an algorithm you can use to predict that for all submissions. If the link here has the post's original title, we won't. If it doesn't, we'll replace it with the original title.

I know of a counterexample from this week. The original submitter (I) posted an article I learned about from a local scientist with the original title

http://news.ycombinator.com/item?id=2813270

and then during the subsequent discussion the HN title of the thread was changed to something that I don't think is a fair summary of the submitted article. (I don't know which curator did that, or which users flagged the thread, but I saw it happen after it was too late to edit the original submission.)

The original article is here and you can see its title:

http://independentsciencenews.org/news/23andme-disproves-its...

After edit: In view of the blanket policy statement to which I am responding, I'm especially curious about the recent exception I linked to.


I'll go out on a limb here and point out that this is just a broken window and some unobservant neighbors away from having nothing at all to do with AirBnB or the concept of short term rentals. These people are criminals and should be treated as such.

Just like you can meet a violent person while dating through Match.com, you can rent out your place to a terrible person using any number of services. The service is something people want and can only do so much to make the marketplace safe. Anytime you connect with strangers, whether it's through AirBnB, the newspaper, a dating service, or by meeting them at a grocery store, there are risks to letting them into your lives. AirBnB is doing the right thing now, and if anything, it's good that this incident will make users of the service more careful. You can't expect companies to perfectly guard every user against every edge case when human elements are involved.


It's horrible but inevitable that something like this would happen.

I can imagine it'd be useful for a third party service that provides identity checks and insurance or escrow for AirBnb customers. Why play with fire (without hazard insurance)?


Airbnb should partner with both and turn it into a business opportunity.


Most unfortunate, but letting a complete stranger into your house with VALUABLES was never the best idea, moreover, with a company that hasn't said anything about this kind of issue before. I suppose this system has worked, but it's beyond me how you could ever trust a stranger to live in a place that you live in regularly and store many valuables in.

I want to sympathize with the victim, but it's somewhat hard to given the circumstances. In any case, AirBnB should suck it up, fix this one situation, then go into full throttle with trying to come up with a plan to prevent future things of this sort.


I rented an upstair room to a backpacker a month ago in Saigon Vietnam. On his last day, he picked up some chick off the street, brought her home and locked the front door from the inside. My staff ( I have an online bookstore there) couldn't get in for half a day. I sent airbnb a message complaining and heard nothing back from them. I don't think it is that hard to hold a credit card number of the guest just in case stuff like this happens. Why they are not doing it is beyond me.


I'm curious, how would you guys handle this situation if you were running Airbnb?


While the right PR thing for Airbnb to do is cover the damages done, I am a little disappointed by the Airbnb hate I'm reading here. Why should they be held liable for the damages? Were they negligent? Airbnb offers a service. They match renters with houses. Do they make any warranty as to the reputation of the renters? Go to http://www.airbnb.com/terms and read the very first section.

I'll admit that the victim has a good point about the secrecy imposed between the parties by Airbnb, but that's just a policy, not a liability, and it can be changed. It's like buying a car that isn't as safe as it could be. Sure you could pay more and get a very safe car, but as long as the manufacturer didn't misrepresent the safety of the car, you will have a hard time holding the company liable when you get injured in a crash.


"Update: I spoke with Brian Chesky. He says the company has offered “to assist financially, find new housing for the host, and anything else she can think of to make her life easier.” He says they intend to “go above and beyond” to make the situation right for her. This is different than what a company spokesperson said earlier (see above). I asked Brian if this sets a new policy, and he responded that they’ll look at it on a case by case basis."

Basically what they mean by "case by case basis" is that if you cause enough of a media shitstorm to make them look bad, they'll step in and help. And they'll look at your case to determine if you are causing enough ruckus to validate them going "above and beyond."

At least, that's what I gleaned from it.


Anyone else find TC's stock image annoying for this story? I guess it fits the tone, but it twisted my imagination a good deal, even after I'd read the original story. A real photo would have been valuable, but a generic one is distracting.


Yeah, I was half way through the article before I realized it was a stock photo, then I was annoyed.


I had to check the FAQ question about the piano. It used to be at http://www.airbnb.com/help/question/31 but they seem to have removed it.


I am relieved that this individual is alright. Just imagine if she had returned home early and decided to check in or something and found the individuals in the act. Who knows what the reaction would be. I'm happy it's (mostly) just things that have been lost. What if she would have returned early and been murdered for witnessing something she wasn't supposed to? It seems like airbnb has a huge exposure here and if this woman doesn't attempt to cash out on airbnb, i would expect to see a case where that does happen. They are a very ripe target.


Doesn't AirBnb require a credit card from the renter? Wouldn't it be straightforward to find the vandalizing renter using their credit card information? I'm sure that I'm missing something here...


The other big discussion indicates that the SFPD have already made an arrest. I think it's more about the bell that cannot be un-rung at this point.


An identity thief or general criminal likely has access to any number of stolen credit cards.


No it doesn't. I've booked on AirBNB using paypal.


This is a great example of how journalists will shamelessly jump all over a story and selectively represent the truth to the point that, taken as a whole, the article becomes a misrepresentation.


If you're going to rent out a fully furnished apartment full of valuables to strangers who you can't vet beforehand the insurance costs will be significant.

I have a feeling AirBnB don't offer insurance because the premiums required (and the cost passed on to hosts) would make the entire thing unprofitable.

Hotels have insurance but it is probably much much lower than what AirBnB could provide to hosts because hotels already have a) security infrastructure in place b) your credit card details and c) your agreement to be held liable for damages.


What about this from her own blog post?

> I would be remiss if I didn’t pause here to emphasize that the customer service team at airbnb.com has been wonderful, giving this crime their full attention. They have called often, expressing empathy, support, and genuine concern for my welfare. They have offered to help me recover emotionally and financially...

(http://ejroundtheworld.blogspot.com/2011/06/violated-travele...)

edit:formatting


Maybe it is because I live in a 3rd world country where we dont have enough security (Brazil), but I would never think about renting my place to a complete stranger. I would think a lot to rent it even after a lot of interview and research, but I would remove all personal and expensive objects.

That said, I feel really bad for the girl and I hope she recovers. Most people are good, but there are a big number of bad people around to justify some level of security concern.


[deleted]


>I was wondering, why is the reaction to this incident so different than the tech community's response to all of the CraigsList incidents? (Which include theft, prostitution and even murder.)

CraigsList isn't a party in the transaction.

>Seems like as soon as you pay for a service, your expectation goes much much higher.

How it could be otherwise?


I can't imagine leaving my house for a week, to rent it out to complete strangers, with all of my possessions in it. I'd be afraid they'd rifle through m belongings and perhaps steal some, or even something like this would happen. Maybe they'll copy the keys and come back and rob the place three weeks later. How would one be sure? All in all, being an AiBnB host is a questionable enterprise.


I wonder if there is a reporting bias for people who have had bad AirBnb experiences, given that renting out your apartment is not always legal.


If I were AirBnB I'd be talking to an insurance company right now about offering supplemental insurance to renters. AirBnB could make a nice chunk, the way Best Buy does when it gets you to purchase those stupid protection plans, and simultaneously offer users peace of mind that this will at least be taken care of if it happens to them,


The news and the hotel lobbies are going to be all over this. VCs are probably tapping their fingers on the table.

Like others said already, If I were Brian, I'd have lunch with EJ, like, today. Whatever solution they find financially, Brian can't let ABnB's cool image turn all corporate and aloof by leaving this one to the lawyers and bean counters.


No brainer. Build insurance into the site. Renters can either opt for it or not, or AirBnBcan be provided it universally, their call. AirBnB needs to step up their protections. (my apologies if others have already suggested this.)


I wonder why the initial response was "They won’t reimburse her for damages"?

Does this mean that as soon as Brian & co are not involved in day to day operation the service AirBnB offers will deteriorate?


Excuse me this naive question, I haven't been following the Airbnb, but how is there service better compared to say free Craiglist?


Their website is much more pretty...jk.


Events like this present a pretty big moral dilemma about Internet anonymity - at least in context of this category of services.


It does seem a bit strange that this story from June breaks just days after AirBnB rakes in 112 million in funding.


Dream come true for a law firm. I bet they can make Airbnb pay up in court.


I doubt it. I'm sure Airbnb new exactly what risks there were in offering this service, and had lawyers very carefully craft terms of service that protect the company from damage done by renters.

A good lawyer would argue that this is a criminal case between the renter and the home owner, not a civil case between the home owner and Airbnb.


airbnb has had the advantage of having a mainly "geek" clientele so far. As it expands it's going to get less savory users.


Not having used AirBnB, I was incredibly surprised that they don't have a policy like getarounds, where the owner is fully insured by getaround.


An agressive competitor (say, a hotel chain) could do things like this every month, and kill airbnb as a business.


Ebay had the same kind of customer nightmare cases in their early days and still are in business today.

The following news from March 09, 2001

http://www.nytimes.com/2001/03/09/business/3-men-are-charged...


If AirBnB comes to the rescue with lots of zeros on their donations to make the person whole. I can envison people taking advantage of this, Have your buddy ransack your house and steal all your stuff, then split the gain of having it all replaced.


A related article talks about how David Patterson and the state of NY has made it illegal to rent your house to others a la AirBnB.

If people want to trust others enough to risk this sort of crime, let them. Get the fuck out of my life, State.




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