Airbnb, No. 1 in short-term rentals, aims to expand its horizons

Airbnb is looking to friend travelers -- and the travel industry should take notice.

The young turk of the short-term rental market unveiled two new services on Tuesday to make people feel at home when they travel.

One is its first guide of neighborhoods in seven large cities –- Berlin, London, New York, Paris, Rio de Janeiro, San Francisco and Washington, D.C. -- that with colorful photographs and detailed information from locals aim to make it easier to find the best place to stay. The other is a pilot program in Airbnb’s hometown of San Francisco that designates 10 coffee shops as warm, Wi-Fi-equipped havens for Airbnb travelers called “Local Lounges.”

Airbnb made the announcements at a press conference in San Francisco. With the two new services, Airbnb is not just trying to appeal to a greater cross-section of travelers and edge out its competition, hotels and other short-term rental providers. It’s a clear signal of its much-broader ambition to burrow even deeper into the travel market, taking on Lonely Planet and other in-depth guides, even local websites such as Yelp, in its pursuit of becoming an all-encompassing destination for travelers.

The company has telegraphed its outsized ambitions in other ways. Founded in 2008 as a way for San Francisco roommates to rent out their air mattresses as a way to make some extra money, Airbnb now has 250,000 listings in more than 30,000 cities. Last year it raised $112 million in funding. Rumor has it that investor Peter Thiel could put in as much as $150 million more at a valuation of $2.5 billion.

Not long ago, the notion of renting from strangers rather than booking a hotel room was still novel. The popularity of Airbnb has been fueled by bargain-hunters in a sluggish economy.

The company still faces questions about whether it has created legions of unlicensed hotel operators in residential neighborhoods (although fewer than a quarter of its listings are in the United States). Along with the murky legality of short-term rentals, Airbnb survived a rash of bad publicity last summer when a woman’s San Francisco apartment was trashed by Airbnb guests. Airbnb issued a public apology and now offers hosts up to $1 million in insurance.

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