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Summary:

After building up millions of users in the last eight years, DIY travel website Couchsurfing has stepped it up by going for-profit and taking venture funding. But some aggrieved users feel that they’ve become pawns in a game… and they aren’t happy.

Couchsurfing promo

CouchsurfingFor years, CouchSurfing was one of the web’s gems. It did a simple thing well: connect people who need a place to stay with those who were willing to give up a spare bed or couch. It was free, it was simple, it was friendly and it was fun. It was AirBnB before AirBnB.

Since launching in 2003, the service racked up more than 3 million users who helped each other travel, without ever pushing too hard or cashing in. It was a community effort, and the company’s non-profit status undoubtedly helped it project the image that it was part of a hands-around-the-world affair.

But earlier this week CouchSurfing announced a string of major changes. It turned itself into a for-profit corporation, raised $7.6 million in venture funding from Benchmark and Omidyar Network, and announced plans to start “aggressively hiring.” And that’s got some users spooked.

A protest group has formed on the site, questioning the decision to change the company and asking for more clarification on what’s going to happen. It’s even more galling, they say, because CouchSurfing community members have been donating money and contributing code to the project for years to help it stay afloat.

We had wonderful experiences with Couch Surfing, we absolutely LOVE CS and there will never be enough thanks to everyone: volunteers, CS employees, every member who worked on the idea during years and years.
CS was born as a community, built and strengthened by many volunteers spirited members and now turned into a corporation.

Joining that group means that you are supporting this initiative!

We want the source code written until now by volunteers and the database to be released!

The group is still small — a little more than a thousand protesters at last count — but they are angry. And while you can’t please all of the people all of the time, anyone who runs a community-based website knows that their business can live and die on the goodwill of superusers.

The CouchSurfing protesters have eleven demands, mostly focused on greater transparency and getting more information about how the site might be more heavily commercialized. Will they get what they want?

These situations can go either way. Communities can rise up and get changes made; just witness how many times privacy dramas at Facebook have forced the site to change its intended direction. Sometimes, though, communities fight back without much significant impact (as with those who were angered by the Huffington Post’s acquisition by AOL). Some of those squabbles are inconsequential, but you can understand why people who give their time and energy to a site get pissed off when they’re effectively used as collateral.

To be fair, the team at CouchSurfing is trying to explain the situation to those angry at the shift. In one thread, a user recounts a conversation with founder Casey Fenton about the reasons for going for-profit: essentially to allow the business to raise money to help keep the service alive.

Couchsurfing promo“Becoming a B Corporation will now allow Casey to hire 10 more expert programmers and pay them a salary that is competitive with the Silicon Valley job market,” said the poster, Daniel Malafaia. “This will allow the website to work as a rock-solid engine from now on, no matter how much the number of members grow in the following years.”

It’s a fair point, but doesn’t really address everything that has happened in the past week — such as the need to raise venture money. After all, whatever the expense of bringing in a top developer, there’s no doubt $7.6 million buys an awful lot of programming talent. And while Omidyar Networks might be a philanthropic investment group, Benchmark — which has been involved in exits for businesses like Mint.com, MySQL and Friendfeed — most certainly is not. It wants a return somewhere along the line.

The real problem is that, despite Fenton’s best efforts to say otherwise, it looks like CouchSurfing simply found itself sitting on top of a potential goldmine. Watching the rest of the industry — an industry it pioneered — getting rich must be hard to bear. Of course there’s AirBnB, which scored $112 million from investors, but there are plenty of others too. At the high end of the market, Euroglam vacation rental site OneFineStay scored nearly $4 million and even a direct CouchSurfing competitor, Tripping.com, scored $1 million in funding.

But given that CouchSurfing is unlikely to capitulate to the demands of a small group of users — not least because it will have taken months to get to the point where it is now, and presumably some of the money is already being spent — what can it do?

Perhaps there’s a lesson in all this that Casey Fenton and his team can take from Craigslist. Craiglist is a profit-making company, and even has eBay as a significant shareholder (much to the chagrin of the site’s other owners). Yet it remains avowedly independent and low-key and very successful. Sure, there are arguments and spats and strife with the law from time to time. But it manages to feel authentic.

Does that mean Couchsurfing should adopt the we-haven’t-changed-since-1995 look? Should it avoid commercialization as much as possible? I don’t know — but you get the impression that the site’s owners will have to do something significant if they don’t want to upset the community that has given it this opportunity.

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  1. Alot of members are unhappy with this move across various group discussion boards and are angry about a lack of transparency. Since the membership database and willingness to host are the only CS assets, many feel its time to move to a true non-profit hospitality exchange site like bewelcome.org

  2. Has anyone looked into the legality of this conversion? Generally, a charity’s assets cannot be distributed upon dissolution because of the common law of charitable trusts. It seems to me that if Couchsurfing is taking its prior assets to a for-profit, that’s illegal. Couchsurfing would have had to get permission from the Attorney General (or a court) of the state of it’s formation in order to convert to a for-profit corporation. Did they do that? And if they did, what AG or court allowed this?

  3. After the news broke last week I wrote a statement to the community, assuring them that we’ll stay non-profit and will go open source: http://volunteerwiki.hospitalityclub.org/couchsurfing-for-profit-business-now

    Veit (Founder of Hospitality Club, the second-largest hospitality exchange network :-)

  4. Casey had 10 expert programmers working on the code back in January 2007 but wasn’t very happy with the lack of control. Google “NDA couchsurfing” for some of the mess that happened.

    Veit, where’s official non-profit organization for Hospitality Club?

    https://www.bewelcome.org/ was started by former Hospitality Club volunteers fed up with Veit’s dictatorshop and later to be joined by many former C$ volunteers.
    BeWelcome is the only official non-profit online hospitality exchange network and the community has a say in what’s happening.

    1. BW is practically dead for good reason. If anyone wants to know the background: http://www.bewelcome.info

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