It's a marketplace business, all internet marketplaces are tech companies because they simply aggregate buyers and sellers while owning none of the assets/inventory/risk being transacted on the platform. Airbnb is just a website with a ToS. There is zero marginal cost to Airbnb for servicing a new listing.

Do you also question whether Ebay is a "tech" company?

this is an amusing question actually.

is cme group a tech company? it is literally marketplace technology. eurex and xetra, nasdaq, nyse, bats, lse all those guys as well.

if you want to go a bit further, jpm, morgan stanley, goldman, barclays and so on are also tech companies, since they're one layer over all these marketplace tech companies, but with their own internal marketplace technology on top of it.

anyway, it's all very silly and meaningless categorization.

Everything can be both tech and not-tech if you want to argue semantics (ie. If you use a computer to do your job, is it tech?). That's not useful.

But I find the zero marginal cost qualification useful. These companies are fundamentally different than companies that are further out on the marginal cost spectrum.

Take for example CME, NYSE, Nasdaq, etc. Pure zero marginal cost. Virtually unassailable positions for the marketplace niches they dominate.

Then compare that to JPM, Morgan Stanley, Goldman (farther down the spectrum). While they do offer software products in trading, retail, etc...they also offer lots of high touch, high human cost investment banking services. Not the same thing.

It doesn't really matter if you IPO with JPM or Goldman. The bank will make lots of fees but it will be proportional to their man hours worked. No obvious winner.

By this definition, you could say they do some tech, some old school professional services.

As a "tech worker," I find this useful when examining which employers to work for. It determines how much leverage I can have in affecting my employers business. Far and away, the best jobs I've had are at companies on the extreme end of the zero marginal cost spectrum (pure tech, by this definition).

To use banking as an example, you can go from zero to $1B quite quickly in the software (zero marginal "tech") side of the business. Look at SoFi or Plaid.

Meanwhile, on the old school professional services side, imagine how hard it would be to get to $1B there.

This is an incredibly insightful take.

I would like to subscribe to your newsletter. (Serious)

My takes are mostly stolen from other newsletters like Stratechery and Capital Minded

> zero marginal cost to Airbnb for servicing a new listing.

Don't underestimate the cost of customer support (on both ends), dispute resolution, ...

All tech companies have support costs. This does not make them non-tech companies.

Salesforce isn't suddenly an old school manufacturing business just because they have a customer success team.

Airbnb's customer service on cancelations and disputes have all been relatively fast in my experience so I imagine they invest heavily.

> Do you also question whether Ebay is a "tech" company?

Yes.

Airbnb's main offering is its software and its ability to create a market between consumers and producers through that application. I imagine it is also a company that is heavily invested in its software engineering workforce and all the resources that support/flow from that.

To note, it feels like 'tech company' is a bit ambiguous these days and doesn't necessarily have great clarity.

I would suggest the following:

* a car company makes cars that it sells to consumers or other businesses

* a tortilla company makes tortillas that it sells to consumers or other businesses

* a chip fabrication company makes chips that it ...

... you see where I'm going with this?

* a tech company is a company that makes technology that it sells to consumers and other businesses.

Amazon is a tech company, but only because of AWS, not the marketplace or its own retail operations.

AirBnB is not a tech company. Neither is Ebay.

Maybe we need a new term like "tech-dependent company" to describe most of what are currently termed "tech companies".

All companies are "tech-dependent companies." This is an intellectual dead end.

Traditionally, the business world has qualified tech companies as those which primarily function via zero marginal cost distribution provided by software and the internet.

If Airbnb and Ebay aren't tech companies, then neither are Google and Facebook. All four are marketplaces (Google and Facebook are advertising marketplaces at their core).

Saas and marketplaces are the most solidly "tech" businesses that exist by the textbook definition. They fully take advantage of zero marginal cost distribution.

I don’t think that definition is right. Nobody will argue that Apple isn’t a tech company, and the iPhone isn’t zero-marginal-cost.

This isn't a black or white thing. It's a spectrum. On one end you have pure play tech like Stripe or Facebook (100% zero marginal cost). On the other end you have industrial firms who produce mostly undifferentiated commodities with thin margins like tires (super high marginal cost).

Apple is clearly a tech company since they conduct tons of activities that are zero marginal cost (iOS, MacOS, App Stores, AppleTV, Apple Music, Apple News, Logic Pro, iCloud storage, etc. etc.)

However if you remove the software part of their business, then they'd be a commodity phone company, and valued by Wall Street in the same way TV manufacturers are (ie. like Samsung, with a PE ratio roughly half that of Apple).

The higher value and differentiation is mostly derived from the software (an OLED screen with a processor attached isn't high margin otherwise--see Samsung's margins). Hence why "software is eating the world."

Would you call Tesla a tech company?

Yes. They make and sell technology to customers.

Tesla is a tech company, and Facebook/Amazon/Google are not? Maybe your definition is “right” in some sense, but is also useless, given that it’s not the definition anyone else is using.

Then under your definition, Otis elevators and GE and Boeing and are also tech companies.

boeing has lots and lots and lots of software. they aren't a consumer electronics company or engagement optimization company, but they sure are tech.

Yes, they are.

Amazon doesn't make anything. Increasingly it doesn't even own what it's selling. Same with AirBNB. They're selling a marketing platform to businesses.

AWS isn't a "marketing platform", and it's where most of their profit comes from. It's a bundle of many different and related technologies, most of which have only a few competitors and would be tricky to implement locally.

And then there's that "Amazon doesn't make anything" claim so neatly demolished by jodrellbank.

> Amazon doesn't make anything.

Kindle. Firestick. Echo / Echo glasses/earbuds/wearables. Delivery drone (prototypes). Luna controller. The new AZ1 chip inside Echos. They own Ring (doorbells) and Eero Wi-Fi routers.

They custom design[1] their own internal routers, chips, storage and compute servers and network cards, they own Annapurna.

[1] https://www.geekwire.com/2017/amazon-web-services-secret-wea...

Sure. Their biggest production line is probably the robots that are at work in their warehouses. But it's all still a rounding error for the core Ecommerce & data center businesses.

> biggest production line is probably the robots that are at work in their warehouses

pffft. Robot roles for their warehouses is a distinctly bounded and rather small "marketplace". Kindle sales likely outnumber this by at least 3 orders of magnitude. Not to mention Alexa technologies.

An Amazon employee once told me that Jeff Bezos would agree that Amazon is _not_ a tech company

> Airbnb's main offering is its software and its ability to create a market between consumers and producers through that application.

Is Expedia a tech company?

Yeah, they were definitely part of the first wave of bing name internet tech companies. I expect that in 10 years AriBnB will be similarly boring.

Expedia is literally a dotcom that was spun off from Microsoft.

I don't think the labels of "tech" vs "hospitality" are exclusive in any way. I think there's a good argument to be made that we should consider Airbnb a "hospitality" company, but ultimately the label of "tech" company is shorthand for a set of characteristics of the business that other sibling comments have called out -- large amounts of R&D, low marginal costs, and low CapEx. Their product is hospitality, but the company has operating characteristics that have more in common with Facebook than with Marriott.

I think you're confusing them with wework which is famously know for being a real estate company masquerading as tech.

Airbnb has made some non-trivial open source contributions that I'm aware of at least. There's a very popular eslint style guide based on their internal policies and they've also created an svg animation library (the name eludes me) which is popular with designers as it accepts Adobe AE as input.

Lottie[0] is the animation library

[0] https://airbnb.design/lottie/

they dont own the assets, their product is their booking technology

> they dont own the assets, their product is their booking technology

No, their product is their booking service.

The technology is capital (means of production), not product.

Didn't stop DiDi!