I've been on Airbnb for more than a decade now. I just checked out, my profile is 11 years old, and I received my first review from a host in June 2013. I remember that stay vividly. Back then I was living in Singapore, and this was my first trip to Jakarta, Indonesia. As far as I remember, I've always been a fan of Airbnb. As a guest obviously; but later on as a host as well; and in between as a fellow entrepreneur.
Of course I miss that sense of 'community of travel lovers' Brian mentioned a few times in the discussions below but still, the traveler in me thanks them tremendously for all the soulful moments - past & future - I got to experience through them. And the entrepreneur in me is still in awe with the energy, dedication and inspiration their story creates.
In today's episode, we're talking with Brian Chesky, cofounder and CEO of Airbnb. YC funded Airbnb in 2009, when the company was at death's door. During YC we watched the founders work frantically to get growth started and turn Airbnb into the rocketship that it is today. Learn what it takes to come up with an idea so weird that it seems like it will never work, and then make it work.
A few things I'm still blown by:
- they launched at SXSW in 2008: ended up getting 2 bookings only that weekend
- they experienced themselves the kind of magical experience behind receiving strangers home and connecting deeply with them
- they were raising $150k at a $1.5m post-money valuation (!) and all the investors they met said 'no'
- worst, they received answers such as "I love everything but you and your idea" -- even worst, Brian recalled a meeting with an investor at a university cafe: "I'll be right back, the guy got a strawberry smoothie, drank the smoothie, went 'uh-huh' all the way, never got his head out of the straw, and halfway through the pitch, got up, walked away and left, smoothie on the table - we never heard from him ever again" WTF 😱
- Airbnb was a 'total struggle' -- "we were depressed; YC was our final shot"
- big ideas seem crazy at first
- best and worst advice received at YC 👉 (worst) move to Mountain View; (best) you basically want to have a few people who really, deeply love you (which felt counter-intuitive), do things that don't scale, focus on designing something perfect for one person! design the perfect experience of what the most astounding product could looke like - don't care about growth or distribution; growth = paradoxically your worst ennemy to make your product perfect
- slow down, pay attention
- things grow because people love them and tell other people about them; it's a really simple thing at the end; make something people love and go crazy about then (counter-intuitive)
Today we pick up where we left off in Brian's incredible story of startup survival.
A few things I'm still blown by:
- during YC, always the first people in, last people out; all live together: proper rythm; our goal was to hit ramen profitability; we put our revenue in the bathroom, first and last thing we'd see before going to bed; that discipline became our habit, our culture
- be grateful for the stage before you get traction, it's when you can change your product the most
- what was the market of bed & breakfast; sure the vacational industry is big; our market was 'hotel replacement' but we never thought of that
- we discovered an experience; then go back to first principles: travels always started with homes; only then it got industrialised - when I shared the idea with my grandfather he told me 'that's how I used to travel as a kid' - new tech = new change of behavior; people don't trust strangers; our insight was: let's build a system where you can describe strangers so you'll trust them and can host them
- remain curious; we had a passion for hosting; I hated tourism; it was all about community and connnecting; bringing people home
- we were so anchored in this idea of airbeds and breakfasts, when the first person told 'I have a spare bedroom to rent' we said 'no' 🤦♂️ no mattress, go buy an airbed; later on, when someone wanted to rent his place while not being present we said 'at least you come back in the morning to make the breakfast'; realising you could rent your entire home/ flat acted as pivotal moment; it seemed totally crazy to us; we went from airbeds to extra bedrooms [bigger market; maybe fundable] to airbnb -- later on: treehouses and unique places
- expand people's imagination; platform is more extensible than what we envisioned at first; which is why investors should invest in founders, not markets -- you have to think differently about markets
- right before COVID-19 hit, we were making $35 billion in bookings a year; we lost 80% of the business in 8 weeks
- holidays between 2019 and 2020, I had a stack of S-1 (document to go public), like 20 of them because we're working on ours
- mid-march, the world shut down, everything stopped; emergency board meeting; 'nothing has been that disruptive since World War 2'
- there wasn't any certainty that we could survive; people used words like 'bankruptcy'; I literally went from 'I'm successful' to 'I'm about to lose everything'
- it's your defining moment as a leader; great companies are defined by crisis; I told myself 'we're unkillable'; I realised the hardest thing if you're a leader is to manage your own psychology
- we stepped up the communication: weekly all-hands Q&A, daily stand up every morning & evening with my executive team, a board meeting every sunday, I called every board member every week
- your house is burning and you can take only 3 items; I did that on company level
I love this word: 'unkillable'. Brian seemed so happy that PG refered to them as 'the cockroaches'. I decided to make a distinct page out of the examples of a few cockroaches overtime.
Objet du jour
Since we're talking about things that last, I inheritated a leather jacket that's 40+ year-old; and counting. Full story engraved for eternity with Objet.