Lessons from Airbnb and Brian Chesky

In 2007 Brian Chesky & Joe Gebbia launched a simple website but barely anyone noticed. Now that site, Airbnb is big, rather huge. The story behind their 8-year journey as a startup inspires many entrepreneurs like myself. Here is what I have learned from the story of Brian Chesky and Airbnb.

1: Airbnb was not even close to cool idea

If I could be a venture capitalist in the Silicon Valley back in 2007 or 2008 and have an opportunity to hear Brian Chesky’s pitch, I would definitely react in same manner as other people.

“I thought the idea was crazy… Are people really going to do this? I would never do this.” venture capitalist Paul Graham said.

Chesky says: “When we came to the Valley, no one even wanted to invest in Airbnb.” One of the reasons was they thought the idea was crazy. People thought: ‘I’d never stay in a stranger’s home. That’s creepy’.

As an immigrant, I would have thought: “that’s the last business idea I could think of starting here in U.S.” From my perspective, people who grew up in the U.S. consider private space more sacred than people who grew up elsewhere.

Upon hearing a response like this, many of us would probably drop the idea. But they didn’t. And now we all know we were completely wrong. Airbnb is now evaluated at over $25 billion, according to CNN Money.

So what have I learned? That there is no OK-to-ignore idea. Every idea deserves careful attention.

Every idea deserves its own pursuit, and any idea could turn into a billion-dollar business. Innovation can happen everywhere, topic unbound. It’s up to the entrepreneurs’ imagination and drive.

2: Understanding the market ultimately takes legwork

Any entrepreneur inspired by conventional wisdom would believe in a myth about product and market fit. Identifying the market fit is the Holy Grail to have successful business journey. But understanding the market and customer base is always a challenging and hit-and-miss process. Many pundits encourage young entrepreneurs to survey, interview and research potential customers vigorously, but ultimately a successful product requires entrepreneurs’ insightful thoughts and envisions.

But how do we instigate insightful thoughts and envisioning a great product? Paradoxically to digital economy, Chesky said the Airbnb case shows us how finding product and market takes legwork. For the problems they try to solve, Chesky & Gebbia crafted a very untechy solution.

According to them, they focused on ‘non-scalable thing’ at the early stage.

“Do things that don’t scale,” Chesky says, a sentiment that would be considered blasphemy at Google or Facebook. “We start with the perfect experience and then work backward. That’s how we’re going to continue to be successful.” — from fastcompany.com
To create the perfect experience for one person and then scale, work backwards. A lot of companies don’t do that; a lot of companies make a small tweak for everyone, measure it, make another small tweak, get that out and measure again. You keep turning dials, kind of arbitrarily, hoping you get a good signal. We said “Let’s just design something from the ground up for one person, make it as great as possible and then scale it.” That’s how we (Airbnb founders) came up with a lot of our concepts. We designed the end-to-end system for a small number of people and scaled it. —from fastcompany.com

Airbnb founders went door-to-door to gather firsthand data and opinions about the services and customers. As the old Asian saying claims, “cleverness never beats honest legwork.”

3: Getting off the ground is always the hard part

In the end, everyone praises success. Easily. Very easily.

But the biggest challenge is always at the earliest stage. Small team, never enough money, unproven market ideas, etc. To the entrepreneur, everything looks so adversarial during this period. Perseverance is essential and “Pure, Unadulterated Hustle” is the key element to keep it going. In Airbnb’s case, two designers tackled very real problems with a fresh perspective. I was amazed how long Airbnb held the ball to keep going until they created traction and began to scale.

4: Culture is essential

Some say you have to be a hacker to start a technology company. But the founders of Airbnb are two designers. Brian said the Valley “didn’t think a designer could build and run a company.”

But Brian and Joe took it differently.

“A human-centered company, built around empathy, using creativity. I thought we were the perfect people and we certainly have something to prove.” — from dezeen.com

Much of the Airbnb culture spurred from the founders’ own origin and background. So now we can say “You no longer have to be a hacker to start a company.”

For more on culture, I’ll let Brian’s own words speak here:

“Why is culture so important to a business? Here is a simple way to frame it. The stronger the culture, the less corporate process a company needs. When the culture is strong, you can trust everyone to do the right thing. People can be independent and autonomous. They can be entrepreneurial. And if we have a company that is entrepreneurial in spirit, we will be able to take our next “(wo)man on the moon” leap. Ever notice how families or tribes don’t require much process? That is because there is such a strong trust and culture that it supersedes any process. In organizations (or even in a society) where culture is weak, you need an abundance of heavy, precise rules and processes.” — from his own medium post

Like the sorrowful Van Gogh painting Brian refers to in his Medium article, the Airbnb story says a lot.