Former Airbnb Execs Back Growing Subletting Startup in NYC

18.06.2024 - 07:05 / skift.com / Justin Dawes

Ezra Gershanok and Jacob Halbert had made almost nothing in sales for their apartment subleasing startup until this spring. 

Then, they say, the platform got 1,000 new listings in New York City in just two months, and sales jumped to $1.2 million in May. The founders believe the growth spurt stems from Local Law 18, new regulations enacted last fall around short-term rentals.

The startup, called Ohana, is meant to connect hosts and guests for the mid-term rental market, defined as stays between 30 days and 12 months. The platform facilitates an introductory video call between the parties, along with a sublease agreement and payments. 

“The reason we had crazy growth in the spring is because there’s so many people that come to New York City for the summer, and Local Law 18 brought us a lot of supply,” Gershanok said from an apartment in Hell’s Kitchen that the founders are renting through Ohana. “New York City kind of needs this. They need a new legal sublet market, and there’s 16,000 Airbnb hosts that aren’t using Airbnb anymore that need an alternative.”

Local Law 18 requires that New York City short-term rental hosts register their listings, which must be for a bedroom within a unit where the host lives. The reservations must be for fewer than 30 days, and the host must be present during the stays. 

Meanwhile, all hosts are still permitted to book stays of 30 days or longer, whether they are registered or not. 

That meant some hosts started converting their short-term rental apartments into long-term stays. But with concerns about squatters, Gershanok said hosts prefer more vetting than what Airbnb offers for longer stays.

For consumers, it’s safer than finding something on Facebook Marketplace. And the founders believe that consumers generally don’t consider Airbnb for mid-term stays. The jump in business came from word-of-mouth between interns that were moving to New York City for the summer, Gershanok said.

Other clients are businesses, including Wells Fargo and Duolingo, that need short-term housing for summer interns, along with digital nomads and transplants that want to sublet while searching for a long-term lease. 

With improved financials, the Ohana founders in May set out to raise a seed round of funding. 

It only took one week.

Ohana raised $3 million in an oversubscribed round led by Wave Capital, which was founded by Sara Adler, former head of corporate development of Airbnb, and Riley Newman, former head of data science of Airbnb. 

Adler is joining the Ohana board. 

Adler declined to invest in Ohana’s pre-seed round last year, but she was impressed with the progress.

“We got really excited about the specific window and niche that they’re starting with because I think that their