For a while, Couchsurfing had an amazing run, connecting travelers with hosts and helping strangers become friends. Until around 2011, it was a way-crazy gift-economy for hospitality on a global scale, with more than five million members (now seven million) in 90,000+ cities. Who would have thought that a loose non-market community could ever get so big while retaining its ideals and ethical stance?
Alas, Couchsurfing’s popularity created some new problems of its own, and the site was plagued by some dubious management decisions, technical challenges, and the lack of funds. At Medium.com, Roy Marvelous explains what happened in 2011:
Basically, Couchsurfing owed tax money (its tax-exempt status as a non-profit was not approved), it needed far more investment in servers and it needed to hire more engineers to reprogram the site to make it scalable. And apparently, the only viable solution was to become a for-profit, sell a portion to venture capitalists and have it run by professionals.
The problems were real but I’ll be blunt: Couchsurfing was stolen from its members. This was code, content & community built by the members, for the members. None of those volunteers, working for free under the false pretense that Couchsurfing would stay non-profit, received any equity in this new corporation. Why couldn’t there have been another way? I would have donated money. I would have been happy with advertising. They could have moved Couchsurfing HQ to Berlin or Chang Mai or Santiago rather than be based in San Francisco, one of the most expensive cities in the world.
The moment Couchsurfing was sold, it stopped becoming a community and started becoming a service, not unlike Yelp or Meetup or Facebook. And herein lies the problem: Couchsurfing now has an identity-crisis.
After the Internal Revenue Service refused to grant Couchsurfing tax-exempt nonprofit status – formally known as “501(c)(3)” status under the tax code – Couchsurfing decided to become a “Certified B Company,” or “for-benefit” corporation. As Marvelous points out, this was apparently the only way to move forward. (But is this true?) By 2012, Couchsurfing had raised more than $22 million in venture capital money and it was on its way to becoming another profit-oriented corporation in the “sharing economy.” (The so-called sharing economy, it should be noted, is less about sharing than about micro-rentals of things that previously could not be marketized.)