US: The founders of hourly home-sharing startup Globe, formerly known as Recharge, have been threatened with “fines or imprisonment” by officials in San Francisco authorities if they do not immediately halt their business.
The letter sent by city officials to founders Emmanuel Bamfo and Eric Xu claimed that the startup appeared to violate a shelter-in-place order that it implemented in March, specifically that Globe’s Covid-19 specific policies do not go far enough to prevent the spread of the virus, and they have threatened to take immediate action.
Bamfo and Xu are said to have been left “shocked” by the letter and insist that their measures, such as cleaning checklists for hosts and customers having to send pictures of thermometer readings, are adequate.
According to the letter seen by TechCrunch, Bamfo and Xu risk “fine, imprisonment or both, pursuant to San Francisco Administrative Code section 7.17(b) and California Penal Code section 148” if they do not halt their business immediately during the pandemic.
It added: “California Penal Code section 409.5 also authorises the city to close down properties constituting a menace to public health. Likewise, failure to abide by the San Francisco Planning Code is a nuisance and is punishable by fines of up to $1,000 per day. Likewise, failure to abide by Chapter 41A of the Administrative Code is punishable by fines of up to $484 per day.”
Globe, founded in 2019, aims to connect customers with rooms in urban locations for hyper short-term rentals. Rather than stays consisting of days, weeks or months however, its customers book for one day only.
The startup evolved from a previous iteration of the company, known previously as Recharge. Back then, its business model revolved around persuading hotels to let out their rooms on hourly or even minute-by-minute stays, but it was forced to adapt due to the amount of cleaning that was required between check-ins.
It had raised an estimated $10 million in funding from a round at the start of 2019, when it was planning to add private homes to its platform.
Globe now has more than 10,000 hosts registered around the world who are renting out rooms in their own homes but the coronavirus outbreak has prompted a rethink from the co-founders. As people find themselves stranded away from loved ones, the startup is temporarily marketing its platform as an escape from the confines of home so that they can seek out better wifi or a quiet space to make essential calls.
Meanwhile, California is beginning to ease some restrictions. Governor Gavin Newsom has confirmed that barbershops and hair salons can begin accepting customers again in most counties across the state.
While Airbnb and hotels have not been handed a notice by city officials, Bamfo revealed Globe was working on its response but will continue to offer short-term stays in the meantime in San Francisco.