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Silicon Valley now throwing its weight behind Airbnb

A group of venture capitalists and Silicon Valley figures are calling on New York Governor Andrew Cuomo to veto a bill that would impose fines on Airbnb hosts.

The coalition, which involves actor/technology investor Ashton Kutcher and early Facebook shareholder Peter Thiel, urged Cuomo to reject Assembly bill A8704C, which aims to prohibit advertising short term rentals and penalizes violators with a fine of up to $7,500.

Previously, New York State law only prohibited renting out apartments for under 30 days when the official resident is not present. However, listings for such apartments were not officially banned. The bill, sponsored by Republican Andrew Lanza, passed a vote of 56-6 in New York State Senate last June.

“As investors and industry leaders, we believe in the good that Airbnb and home sharing have done for residents of New York State, our country, and the world. We also hope that New York will continue to be a place where the next big idea, like Airbnb, can be conceived and grow. Governor Cuomo, we implore you to reaffirm your commitment to fostering technology and innovation in New York and veto bill # A8704C / S6340A,” the group wrote in a letter.


The coalition also included other technology figures such as Foursquare Founder Dennis Crowley, venture capitalist Marc Andreessen and Facebook Co-Founder Chris Hughes. The group warned that “over-regulation of new ideas is bad for everyday people and bad for New York,” adding that the proposal only serves “entrenched interests.”

“When state legislators voted to levy Airbnb hosts with fines of up to $7500 for renting out their home while they’re gone for the weekend, they also sent a clear message to innovators and creators: new ideas and new technologies are not welcome in New York,” the group wrote.

In spite of the coalition’s support, Airbnb still faces a tough fight in New York City, with both local officials and the real estate industry looking to stifle the service’s growth.

According to the Wall Street Journal, groups as diverse as housing advocates and the Real Estate Board of New York have sent letters to Cuomo urging him to sign the bill.


Sherwin Belkin, a partner at real estate law firm Belkin Burden Wenig & Goldman, disputed the plea of Silicon Valley leaders, saying that the proposal is justified because it aims to penalize the tenant as opposed to the property owner. Belkin said that building owners may be fined even if they did not know that their apartments were listed on the service.

“The bill does not, as the tech folks argue, create some new impediment to Airbnb or similar entities. What the bill does is place the onus and liability on the proper person,” Belkin said. “In essence, the tech folks argue that their business model should be immune from NY law, rather than simply complying.”

Some of the most vigorous opposition to Airbnbn’s presence in New York has come from the City Council. Last March, Council Members Jumaane Williams and Helen Rosenthal warned the company’s top 30 investors about more stringent government regulations.

“If Airbnb truly cared about middle class New Yorkers, they would not continue to allow landlords to take valuable apartments off the market, exacerbating our serious housing crisis,” the pair wrote in a letter.

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