Taken Mind Stories – Airbnb history!
Airbnb, an international company was started up by Joe Gebbia and Brian Chesky in 2007. Airbnb works on the monetization of personal property and concept of shared economy.
www.airbnb.com serves as a one-stop destination for people to find rent and lodging. As of 2015, 1.5 million properties had been listed at Airbnb. Airbnb had turned to be the world biggest Estate Rental service ever known.
Airbnb History :
The emergence of Business Model:
It all started in 2007.
27-year-old Joe Gebbia and Brian Chesky who had met 5 years earlier at ‘Rhode Island School of Design’ were struggling hard to pay their house rent at San Francisco. By that time, there was a design conference going to be held at San Francisco. All rooms in the hotels of San-Francisco got booked. The duo struggling to pay their house rent found a temporary solution to make up for rental money.
Joe and Brian came up with the idea of renting up their home. They had a minimal hope that someone would turn up. The next day they created a website, www.airbedandbreakfast.com. Within 6 days, the duo got their first order. 3 people – a 30-year-old Indian man, 35-year-old Boston woman and 45-year-old from Utah showed up for $80 each.
The duo rented out 3 airbeds on their living-room floor and also cooked breakfast for the guest. Soon after the nights, as the guest left, Chesky predicted that there’s gonna be a bigger scale idea. Sitting at the edge of the sofa, the “dream plan” of Airbnb was framed.
Chesky and Joe planned to get their hands wet on the idea and started a deep discussion. Chesky always had the idea of Entrepreneurship. They came up with the idea of creating a website that helps in renting stuff that already existed. The idea was perfect. They primarily targeted conference and festivals across America. Local People were given an option to list their rooms and the travellers had the option to book them. Very few bookings showed up, upsetting Airbnb.
Entry of Nathan Blecharczyk and the arrival of Co-founder: Airbnb history
Nathan Blecharczyk, then 29, was the former flat mate of Joe and a Computer Science graduate. A new version of Airbnb website came into existence with the entry of Nathan. Nathan was given the co-founder profile for his active web development. In summer 2008, a perfect kick-start for the company development was expected by the trio. It was the Democratic National Convection and a whooping 1 million people were expected to be present. The trio completed their webpage 2 weeks in advance to the conference. Within a week around 1000 listings were made on the website by the users, yet the website couldn’t make money as Airbnb didn’t charge its users. This created a huge upset for the team.
The seed funding initiative: Airbnb history
Taking Advantage of the election fever, the team brought in a ton of cereal and Branded them as ‘Obama’s O’ and ‘Cap’nMcCain’. They sold 800 boxes at $40 each. Thus, the trio made their seed funding themselves at a profit of $30 per box sold.
Series of Investor cash flow:
In 2009, Airbnb crew raised a seed funding of $20,000 from an angel investor- Paul Graham. This was followed up by a Venture Capitalist funding of $600,000.
After the series of investment, the crew felt the need to charge the users for every booking. They thought a decrease in customer base can be easily compromised by the funds generated to brand Airbnb. They started charging up to 15% on every booking.
In 2010, Airbnb raised $7.2 million from VC followed by $120 million in July 2011.
The funding gave them the power to hire more people to work. Airbnb moved into their new office Apartment in Hongkong.
Finally, Airbnb was established In the full fledged form where more than one million bookings take place annually. In the past year, the site grew up by 400% by their clever marketing skills.
Despite a huge evolution of idea, Chesky and Joe still rent the same flat they started in. Airbnb had employed more than 200 employees.
Thus, Airbnb gave a boost to the concept of Shared economy!