Airbnb: the early days
Issue 88 - June 10th, 2022
I love to learn the early founding stories of companies that have turned into mega powerhouses, and this week I spent some time refreshing myself on the Airbnb origin story. It is fascinating to learn about the early days of such a weird concept at the time and its rise to revolutionizing the lodging and travel industry forever.
The original idea for Airbnb was born out of necessity, when co-founders and housemates Brian Chesky and Joe Gebbia were struggling to pay their rent and came up with an interesting way to make some extra money. The two designers had noticed that a local design conference in San Francisco sold out every single hotel nearby, so they put down three air mattresses and offered a bed and some breakfast for any designers who needed a place to stay during the conference.
Rather than using Craigslist to advertise their space, Chesky and Gebbia built their own site called airbedandbreakfast.com. They hosted 3 designers that weekend and made a little money, and they felt like they were onto something much bigger.
They quickly enlisted the help of Nathan Blecharczyk, a computer science graduate and Gebbia’s former housemate, to help them build a more complete website and platform to offer home-sharing between users online.
As the website was completed in the summer of 2008, the Democratic National Convention in Denver had caused a shortage of available hotel rooms. The three founders targeted the area and had a successful launch with hundreds of listings, yet they still weren’t profiting from the operation and needed money.
With the 2008 US election grabbing people’s attention, the Airbnb team decided to put their design and marketing skills to work and created custom-made Obama-O’s and Cap’n Mccain’s cereal boxes.
They sold these “limited edition” cereal boxes for $40 each, and ended up raising $30,000 to put towards the company’s operations. While the custom-designed cereal boxes helped keep the company going, it wasn’t long until venture capitalists began to take note and invest in the company.
At the start of 2009, Paul Graham invested $20,000 and had the company join his prestigious startup accelerator, Y Combinator.
In March of 2009, the company simplified its name from Air Bed & Breakfast to their current name of Airbnb, and started growing exponentially partly in thanks to a $600,000 investment by Sequoia Capital. Other investments soon started rolling in, and in the span of a couple of years Airbnb had become a profitable and globally operating company.
The rest is history, and the future is still insanely bright for this young public company. It will be exciting to see what they do over they next decade and beyond.
Newsworthy Links To Share
Institutional and Private Investors Go After Net Lease Car Washes: Strong credit profiles and outsized growth potential has created a steady market for car wash sale-leasebacks. (Wealth Management)
You now need to earn at least $160K a year to rent anything in NYC- The median ask for a rental in Manhattan has skyrocketed to $3,925 a month — a staggering 31.9% year-over-year jump from April 2021 (NY Post)
'Stripe for real estate' debuts to fund Power Buyer deals: Setpoint is the latest venture from Ben Rubenstein, a former executive of Opcity and Realtor.com. (Inman)
Summer launches to let you ‘try before you buy’ a second home (TechCrunch)
Austin Real Estate News: Luxury hotel planned for super tall Rainey Street tower which may become the tallest skyscraper in TEXAS (Austin Business Journal)