Airbnb was welcomed with open arms in many cities of the US except for New York and San Francisco. In June 2016, there was a lawsuit filed in the court of San Francisco and New York related to their host registration and transparency. According to the sources, the people of New York and San Francisco had opposed Airbnb to provide their services to those hosts who would rent the property for less than 30 days. Airbnb has managed to rest the lawsuit in the court of New York by accepting to their conditions in December and now in San Francisco.
Airbnb already has a total valuation of more than $30 billion and have plans to go public in next one year. These settlements in two major cities of the US have relieved Airbnb from a very difficult situation that might have been opposing their efforts to go public. Arun Sundararajan, a professor at New York University’s Stern School of Business said that Airbnb needs to clear the regulatory reforms against them and then think of going public in order to have a stable environment for performing their business activities. These regulatory reforms might create an issue for the company in future even though they might comply with the previous rules and regulations.
In 2014, the city’s Board of Supervisors issued a fine against the company for an amount of $1000 per host, if any of the hosts does not register in person at any of the city offices in order to control short term rentals. Airbnb was so influential at that time that they filed a counter lawsuit against the city and fined the city for passing such law. Finally, both of them have comprised and Airbnb agreed to collect all the data related to those hosts who would be renting their apartments for less than one month and give it to the city. They would scrutinize the data in order to get their missing host registered.
They would also comply with all the local rules and regulations and cancel all those registrations which the city found to be invalid. Airbnb has been pro-active and very supportive to accept the decision and agreement with the Local authorities in San Francisco, New Orleans, New York and Chicago where they found similar opposition from the Government. Airbnb has not disclosed any of their strategies or further steps related to their decision to go public and are focusing currently on abiding with the agreement in order to sustain their current market position and future existence.