[HN Gopher] The Airbnbs
___________________________________________________________________
The Airbnbs
Author : todsacerdoti
Score : 229 points
Date : 2020-12-10 17:24 UTC (5 hours ago)
(HTM) web link (blog.ycombinator.com)
(TXT) w3m dump (blog.ycombinator.com)
| tempsy wrote:
| Trading at a $110B valuation is surreal.
|
| But it's hard to really disconnect execution from the insanity of
| our monetary system this year...trillions in dollars pumped into
| our economy, 0% rates, and a retail options frenzy has created
| the perfect environment for speculation on growthy tech stocks.
| bsimpson wrote:
| 42% of US Dollars didn't exist a year ago.
|
| If you're wondering why it's been such a bad year to be in cash
| despite the economy crumbling around you, it's because no one
| knows where else to put their money. Stocks and houses are
| being bought with inflated dollars.
| edgyquant wrote:
| Are you sure about that? The current inflation rate for 2020
| is 1.2%, which is almost half what's it been each of the last
| three years.
| bsimpson wrote:
| https://crystalbull.com/federal-reserve/quantitative-
| easing-...
| y04nn wrote:
| Probably referring to the money supply M0, 3.32 in Nov 19
| and 4.92 in Oct 2020. Prices have not inflated, but there
| is more money in circulation.
| tempsy wrote:
| not "inflated dollars" but a weakened dollar that naturally
| inflates assets
| jonny_eh wrote:
| > Stocks and houses are being bought with inflated dollars
|
| How do we know the number of dollars is inflated? Maybe there
| were too few before?
| actuator wrote:
| I can understand Snowflake, Zoom etc. They benefited from
| things going remote and more software eating the world.
|
| AirBnB didn't benefit in any way. It just seems insane that we
| will see such a pop in their stock price.
|
| Or am I missing something here? Does remote work means more
| business for AirBnB properties in the future?
| myth_drannon wrote:
| I used AirBnB for the first time this year to rent a cottage.
| The experience is stellar. For many years I used outdated
| sites like cottagesincanada.com or cottagesquebec.com, it was
| a nightmarish experience of looking for available cottage
| during the pandemic. I just gave up and used AirBnB. Sure I
| paid hundreds of dollars in fees and whatnot but it's just so
| much better experience (searching,reviews...). (And yeah, no
| hotels for travel so no Expedia in pandemic)
| tempsy wrote:
| It works when it works, it doesn't when it doesn't.
|
| Meaning that the company has very little insight or control
| into the quality of any of their listings. So it's always a
| dice roll. If the listing ends up looking nothing like the
| pictures, or is dirty, or you're locked out you're on your
| own, and the best you can hope for is not getting the run
| around from customer service and they refund you fully
| and/or put you somewhere else.
| myth_drannon wrote:
| The same applies to the alternatives.
| raiyu wrote:
| Travel will rebound and their last quarter bookings while
| down are recovering well.
|
| They also have more "rooms" and any hotel chain without any
| of the capex or infrastructure costs so it'sa fantastic model
| that is light on cash and creates tremendous scale.
|
| The pandemic forced them to cancel advertising, save a ton of
| cash, and realize that their brand is strong enough that
| advertising isn't really needed in the traditional sense
| which improves their balance sheet for 2021 and 2022 and
| future years.
| baby wrote:
| Personally I've taken advantage of not having to be in the
| office to move out of SF and do airbnb hopping (stay a month
| here, a month there). It's been great.
| ed312 wrote:
| Renting an entire ABNB is considered a "safe" travel option
| by many. E.g. you live in the city but are sick of your 4
| walls, so you rent a cabin in the woods for a long weekend. I
| suspect whole-home ABNB bookings are through the roof, mainly
| in the summer.
| kilroy123 wrote:
| I agree with you. I was on Airbnb yesterday, looking for a
| cabin in the woods for the weekend. I couldn't find a good
| option, why? The good ones were already rented.
| matchbok wrote:
| Airbnb: the biggest transfer of wealth from the renters and low-
| income folk to homeowners and wealthy in a generation.
|
| Just like Facebook, etc, people who support/work for it are not
| without blame. Bankrolling huge political efforts to overturn
| regulations. Nonsense rules that allow corporate owners to buy up
| low-income housing turn it into vacation homes. Simply terrible
| company.
| standardUser wrote:
| "Just like Facebook, etc, people who support/work for it are
| not without blame."
|
| I'd hate to hear what you think of people who work in the
| energy sector, or textiles, or agriculture, or any of the other
| dozen industries that cause farm more social and environmental
| harm than AirBnB could ever hope to.
| theplague42 wrote:
| Maybe people working in those industries _do_ share some
| blame. However, the linked article is not about any of those
| industries.
| ed312 wrote:
| I've heard this before - can you articulate or link the reason
| why? It seems like the fundamental issue is housing and
| accommodation were wildly mis-priced and a fairly opaque
| market.
| [deleted]
| hunterhod wrote:
| The reaction to "success" posts (in monetary terms) on HN have
| been quite disheartening.
|
| I don't know what's behind the change in sentiment (maybe the
| influx of new users?), but big returns require big risk. It's
| absolute lunacy to pursue a startup, but people do it anyway
| because we've created a system that rewards ambition.
|
| A system that has elevated the standard of living consistently
| since it's inception.
|
| For those preaching "survivorship bias", the "crabs in a bucket"
| fallacy is alive and well here.
| Privacy846 wrote:
| What I see here in the comments are (in part) people that are
| concerned that the business model is just based on exploiting
| regulatory loopholes. Is the concern for people's living safety
| (as well as other things) a crabs-in-a-bucket "fallacy"? Come
| to think of it, maybe regulation itself is a fallacy, in your
| mind.
| jdminhbg wrote:
| There's definitely been negativity around forever (infamously,
| the Dropbox announcement post), but it subjectively feels worse
| now. Not sure if that's real or just nostalgia.
|
| Regardless, it's still disheartening. There's a strain of
| thought that correctly notes that every success story has some
| luck involved and then incorrectly applies that lesson to
| believe that it's a 100% lottery. You can, in fact, still learn
| from people who have succeeded.
| elliekelly wrote:
| I think it has at least something to do with the startup/VC
| shift from "building" $thing to "exploiting" $thing. It used
| to be that the huge tech companies _made_ something of value.
| Lately it just feels like they're extracting value from the
| system. Uber exploits "contractor" loopholes, AirBnb exploits
| hotel /housing regulations, Facebook exploits our privacy and
| democracy. That is pretty grim.
|
| If that's the way to "succeed" with a startup these days then
| I do think startups are pretty grim. I can't speak for others
| but I don't really want any part of creating a company like
| that.
| ceilingcorner wrote:
| I always find it odd that Couchsurfing is never mentioned when it
| comes to AirBnb. In my mind, they laid down the cultural practice
| and AirBnb swooped in to capitalize on it. After all, why do
| something for free when you could get paid instead? Unfortunately
| it was yet another nail in the CS community and as far as I know,
| the couchsurfing concept is mostly dead in the water.
|
| The analogy could almost be equivalent to MySpace and Facebook;
| the former created the mindshare and made the big first mistakes,
| while the latter learned from them and expanded the concept.
| baby wrote:
| You can rent full apartments on airbnb, which is I suspect the
| most used feature.
| ceilingcorner wrote:
| Yes but not originally. The description from PG's post sounds
| exactly like couch surfing, which had been going on for at
| least five years at that point.
| ludwigvan wrote:
| Right. Initial pitch to PG is that it is "basically
| couchsurfing.com for money."
|
| https://twitter.com/paulg/status/1337011619268882432?s=20
| albertshin wrote:
| In the early 2010s, I used to be an Couchsurfing user - as a
| host, guest, and even just meetups for tours/recs while
| traveling internationally.
|
| > After all, why do something for free when you could get paid
| instead?
|
| I really doubt the Couchsurfers were the ones who were
| converting their listings to Airbnb spots initially. Rather I
| think Airbnb enabled previously unwilling (or unmotivated)
| people to start hosting others for a cost.
|
| The type of people I would meet were from a different cut of
| cloth than Airbnb folks. One picked up my friend and I from a
| Megabus stop and later we ended up going to our host's second
| home on Martha's Vineyard. One let us try out his expensive
| cycling bike out for a bike ride. I've attended a yoga session
| with my Couchsurfing host before on a trip. When I hosted, I
| took my guest (a cadet at West Point who hadn't had drinks in
| forever) on a spontaneous bar hop with my group if friends.
|
| There was always a mentality of paying a good experience
| forward and a sense of community - which is tough to preserve
| when it becomes a transactional experience.
|
| That being said, I agree Airbnb likely led to the downfall of
| the CS community. There were some sketchy ppl in that world.
| After running into one of those, I slowly found myself
| preferring to pay for the security and safety although deep
| down I knew I was going to miss out on all the fun that I
| couldn't simply pay for. As for hosting, I just wasn't
| interested anymore knowing that if someone were paying to crash
| at my place, it would be less about hanging out or getting recs
| but more about just needing a reliable roof to cover... where's
| the fun in that for a host?
| enriquto wrote:
| And even older, Passporta Servo, that exists since 1974 and is
| still alive and kicking. Alas, there's no money involved so it
| is of no interest here.
| fairity wrote:
| > Why hadn't they given up? As a money-making scheme, this was
| pretty lousy: a year's work and all they had to show for it was a
| binder full of maxed-out credit cards. [It was] because of the
| experience they'd had as the first hosts.
|
| While I agree that grit and persistence eventually lead to
| success for most smart founders, I think PG's explanation for why
| the founders didn't give up is misguided. If the explanation for
| their persistence was the great experience they stumbled upon,
| why didn't they quit in the preceding 3 years?
|
| My guess is that Brian, Nate, and Joe are naturally stubborn
| (read: persistent) and have a high degree of self-belief. They
| eventually hit the lottery with their idea for Airbnb. Had they
| not founded Airbnb, I bet they would've kept trekking along and
| stumbled upon another (less) successful idea.
|
| Persistence is a double-edged sword. It'll eventually lead you to
| success but at what opportunity cost? I'd be interested in seeing
| studies that help quantify the downside of grit by studying
| founder failures.
| coddle-hark wrote:
| This exactly. I think it's far more common that people hold on
| to a mildly successful business for years longer than they
| really should.
| randomsearch wrote:
| Conjecture: a nerd's approval of Airbnb is inversely correlated
| to their personal experience of living in proximity to apartments
| that are fully let on Airbnb.
|
| I loved Airbnb when they first launched, and I still love renting
| people's spare rooms. But once a close friend started having
| problems with his neighbours, I experienced first hand the
| negative externalities that were involved in making Airbnb rich.
| Renting out a spare room now and then is entirely different from
| dedicated "holiday rentals" in the centre of residential
| buildings. It is hellish for the other residents.
|
| If PG lived in a standard apartment block and was surrounded by
| Airbnb rentals, I guarantee he would have a very different
| opinion of Airbnb.
| thesausageking wrote:
| PG is rewriting history here. The story that "Airbnb was on its
| last legs... They'd try this Y Combinator thing, and if the
| company still didn't take off, they'd give up" isn't exactly
| true.
|
| Just before entering YC, they had a handshake agreement with an
| angel investor for their seed round[0]. The YC partners convinced
| the AirBnBs to back out of that deal and have YC do the full
| round instead.
|
| [0] https://arenavc.com/2015/07/airbnb-my-1-billion-lesson/
| mritchie712 wrote:
| handshake agreement != money in the bank
| thesausageking wrote:
| I don't fault YC for what they did and, to his credit,
| neither does Paige Craig if you read the full post. It's the
| kind of selling and deal maneuvering all VCs do.
|
| But the idea that Airbnb was "on its last legs" and YC was
| their one last chance because "investors didn't think much of
| the idea" isn't true.
| borski wrote:
| I dno, it definitely reads like investors didn't think much
| of the idea, in general:
|
| "I was one of the few investors who actively pursued this
| deal from August through October 2008, and the only among
| them to agree on a term sheet."
|
| "Over those extra weeks, however, the other investors who
| had been circling all dropped out of the deal...instead of
| a handful of us coming together as I expected, I was the
| one lone dude writing a check for the entire seed round.
| But ultimately that was fine by me -- I was good to move
| ahead."
|
| It's not like they had a particularly oversubscribed round
| or anything
| theragra wrote:
| Airbnb is fine, but the issue that you can be left hanging
| without apt if host fucks you over is a real one. Abnb gives you
| money back, but what's the point if this money is tiny compared
| to emergency booking prices. If I understand right, Booking.com
| gives you another room in such case, not just money back.
| nefitty wrote:
| In extreme cases, Airbnb will try to book you a hotel if they
| can't find a suitable home to replace the cancelled one with.
| shmageggy wrote:
| A friend had her Christmas ruined by this shit last year. Host
| cancelled less than 48 hours before the date, and the refund
| for the original price was nowhere near enough to book another
| place on that short notice.
| mbirth wrote:
| This is only the tip of the iceberg, though. AirBnB hosts are
| doing hospitality business without having to obey any
| hospitality law. Also there are a lot of black sheep that
| occupy multiple flats in best locations so people that actually
| want to live there don't find a place to live. And the company
| AirBnB doesn't do anything about that as they only see the
| money rolling in.
| smokey_the_bear wrote:
| eh, I had an AirBnB in Houston, TX in the summer with no AC. We
| left before the first night, and AirBnB wouldn't even give me
| my money back, much less a suitable place to stay.
|
| They aren't an honest company, they're just burning through
| goodwill.
| walrus01 wrote:
| > Airbnb's goal during YC was to reach what we call ramen
| profitability, which means making enough money that the company
| can pay the founders' living expenses, if they live on ramen
| noodles. Ramen profitability is not, obviously, the end goal of
| any startup, but it's the most important threshold on the way,
| because this is the point where you're airborne. This is the
| point where you no longer need investors' permission to continue
| existing. For the Airbnbs, ramen profitability was $4000 a month:
| $3500 for rent, and $500 for food. They taped this goal to the
| mirror in the bathroom of their apartment.
|
| I wonder what the calculation for ramen profitability would look
| like in a fully remote-work environment, in a place where rent
| isn't $3500 a month... Anecdotally I've seen a few people renting
| pretty nice places in Phnom Penh, Cambodia for $500 a month. Some
| stayed there through the entire duration of the covid19 crisis
| due to travel shutdowns and have been working on various things.
| csa wrote:
| Many digital nomads do this throughout Southeast Asia.
|
| I'm not sure I would recommend it, though. Proximity to
| customers (assuming US/EU market) and angels/VCs is worth
| something, and I would suggest that it is worth a lot.
|
| I will also add that when you factor in plane tickets, visa
| runs, etc., it is probably easier and just as affordable to
| find a cheap place to stay in your home country.
|
| If you're bootstrapping a business, especially if you have some
| tie to Asia like manufacturing or labor (e.g., "virtual"
| assistants), then the digital nomad option may be better. But
| for a VC-trajectory business, I somehow doubt it.
| elliekelly wrote:
| If you have US-based clients the time difference makes it
| hard to be "available" from Asia. It's much easier to go
| south: Belize, Costa Rica, Ecuador, Chile, etc. The cost of
| living is about the same but you're still in a time zone
| where it's easy to keep in touch. If you have clients on the
| west coast then working from Guayaquil isn't really any
| different than working from New York City.
| ceilingcorner wrote:
| Most college towns are this affordable.
| robotburrito wrote:
| Mine is health insurance profitability lol.
| gbear605 wrote:
| You can get places nearly that cheap without leaving the US
| even, you just have to be willing to be in a cheap state.
| walrus01 wrote:
| Indeed so, and the calculation for that as something feasible
| will only get better as rural broadband improves. Cautiously
| optimistic for starlink based on beta test results I've seen.
| There's lots of places I can think of in the western US
| states (and BC, AB, SK) that would be ideal for remote work
| if the network access wasn't presently slow or flaky.
| [deleted]
| hankchinaski wrote:
| y combinator bragging
| aresant wrote:
| Would be very interested if PG, Sam, YC vintage team are holders
| at current market valuation
|
| Between SPACs and "startups" rolling public at the moment signal
| from the owners is it's a good time to be a seller.
| nickpp wrote:
| The contrast between the article and the comments here is
| absolutely striking. And it all comes down to attitude.
|
| Some people look at life and see the opportunities. Others look
| and see the obstacles. Some take the hardship they encounter and
| use it to grow. Others use it as an excuse for their failures.
|
| The older I get, the more people I know, the more I arrive to the
| conclusion that it's all about attitude, more than anything else.
|
| It's our attitude that decides if we end up as winners or losers.
| It's our own responsibility and merit, not others'. But pushing a
| victim mentality, a loser attitude on others - is criminal.
| learc83 wrote:
| The older I get the more I empathy I have for people who aren't
| as successful financially and the more I realize that I owe the
| majority of my own success to factors outside my control.
| nickpp wrote:
| I'd rather have a single entrepreneur, building businesses,
| creating jobs, creating value and chasing success for his own
| selfish reasons than a thousand empaths busy telling people
| they are victims and there is nothing they can do help
| themselves.
|
| With the empaths, we'd still be in caves.
| dlp211 wrote:
| That's a nice false dichotomy you built.
| cambalache wrote:
| > With the empaths, we'd still be in caves.
|
| Yes sir, damn empaths, coming together to take care of the
| children and the tribe and hunt for prey. Let every person
| go out there and hunt for themselves.
|
| If it weren't for the "empaths" your would be indentured to
| a warlord at best. Ayn Rand world does not exist, have
| never existed and it will never exist.
| [deleted]
| pseudalopex wrote:
| The older I get, the more people I know, the less I divide
| people into winners and losers.
| Privacy846 wrote:
| In the article I a see a success story for the people behind
| the company. The results (valuation and whatever) speak for
| themselves and how they got there is irrelevant if the only
| question is whether the company is successful in dollars and
| cents.
|
| Here in the comments I see concerns not just about whether the
| company is successful or not, but whether it has done any good.
| That is, _good_ for people other than the owners of the
| company.
|
| That is not about "attitude", or some other self-help slogan.
| You can't evaluate the outside world based on what you read in
| Think and Grow Rich.
| Reedx wrote:
| What kind of return is Y Combinator looking at here? Probably
| more than covers all their investments?
| jedberg wrote:
| I'm not totally sure, but I think each IPO of a YC company has
| more than covered all of their expenses since they started.
| conanbatt wrote:
| I doubt that much. There's dilution and they have offices,
| employees, accountants, etc etc. But certainly they are a
| very successful fund.
| tim333 wrote:
| Something like $3bn so I guess so. (Assuming they have 3% and
| the market cap is 100bn)
| TimTheTinker wrote:
| > People, like matter, reveal their nature under extreme
| conditions.
|
| An excellent nugget of wisdom from Paul Graham. That was worth
| the read by itself.
| mdoms wrote:
| It's trite nonsense. It doesn't even make sense.
| theplague42 wrote:
| What wisdom, exactly? This is neither an original thought nor a
| particularly good phrasing.
| randomsearch wrote:
| Seems a good insight to me, it's a generalisation of "if you
| want to know your real relationship with a person, wait until
| your interests are opposed and see how they act"
| golemiprague wrote:
| I don't understand, is one year of work considered to be a lot in
| the start up world? There are many businesses taking loans or
| living on credit for much longer than that until they succeed, I
| don't understand what is the big deal.
| RIMR wrote:
| I do wish Paul Graham would fix the certificate on his website.
| https://www.paulgraham.com/
| fizzyfizz wrote:
| What is pg trying to tell us with this story?
|
| I think it's evidence for "Billionaires Build", which is an
| apologia for billionaires. pg seems to think we are in a moment
| where billionaires don't have enough cultural respect.
|
| I think pg is trying to show us that billionaires, at least the
| kind he funds, are just better people, or are at least more
| tenacious. The binder of credit cards is supposed to inspire
| admiration for their dedication (rather than horror).
|
| And I think he's congratulating himself for being able to spot
| them. By extension, spotting billionaires (helpful, tenacious,
| people who love to build) and helping them - well, is he saying
| that he's a great person, squared?
| jl87 wrote:
| "are at least more tenacious"
|
| Well, this is true. Compare the average self made billionare to
| others and yes - they are more tenacious.
|
| But that's obvious.
| jacquesm wrote:
| Several of my ex employees have become millionaires. I'd rather
| not take credit for their hard work, and I can't take credit
| for spotting them either, they took every opportunity life
| threw at them, including working with and for me, learned what
| they could and moved on.
| [deleted]
| jaredtn wrote:
| Amazing the pessimism in this thread. Everyone looking for a way
| to tear them down. This is an incredible success story, and
| should be an inspiration.
| JamesAdir wrote:
| This is an outlier and painting it in retrospect as "we knew
| they're gonna make it from the first time" is just ludicrous.
| This stocks are full of money from the government and wouldn't
| stand a chance in a different stock market. Also there are not
| tech companies at all. They are marketing companies fueled by
| cheap money.
| webdood90 wrote:
| The same could be said about people like you. You've completely
| overlooked the negative impact that their business has had on
| millions of people.
|
| An inspiration for wealthy white men in tech? Okay, sure.
| mensetmanusman wrote:
| Was planning to stay in SF at an Airbnb at the end of the month
| until the order from SF was just announced that prevents non-
| essential travel.
|
| Tried to cancel, no luck, out $1000. Airbnb says if you book
| anywhere after March it's your fault if the government shuts down
| the location.
|
| Glad I played a small part in helping Airbnb's valuation.
| heavyset_go wrote:
| Contact your state's Attorney General. They usually have
| offices that handle consumer complaints.
| solidasparagus wrote:
| I wish they would also write articles about the founders spending
| 5+ years on ideas that never pan out and the emotional, financial
| and social toll of that. If YC actually wanted to teach people
| about entrepreneurship, that's a pretty important part of the
| story.
| jacquesm wrote:
| And the likelihood of that happening is a lot larger than
| ending up as a billionaire.
| pb wrote:
| I tend to agree, and have always made a point of telling
| founders that their startup will most likely fail, because
| that's what startups do. Here's a good thread:
| https://twitter.com/immad/status/1335669459705458688
| mtmail wrote:
| https://www.failory.com/ (scroll down to see content) does such
| posts.
| dj_mc_merlin wrote:
| Everyone is aware that businesses mostly fail. Without the
| nerves to try to succeed despite that, you're sure to fail too.
| That's not inspirational bs, humans only do well when they
| think they can (also known as why people who "aren't maths
| people" can't do maths).
| misiti3780 wrote:
| If Airbnb doubled on opening, should all the VCs + founders
| involve be pissed it was so badly mis-priced?
| nrmitchi wrote:
| The IPO price is for new shares which are created, and sold by
| the company.
|
| VCs + founders would have been diluted a bit by that (~8% I
| think?) but they typically[0] still own all of the shares that
| they did previously.
|
| [0] In some situations founders + VCs + early-employees can
| sell as part of the IPO itself. I do not know if that applied
| here.
| gamblor956 wrote:
| Yes. In the past, mispricing this badly would lead to
| recriminations for the underwriters, including lawsuits and
| lost business.
|
| For some reason, the financiers were able to convince the
| gullible tech founders that giving up 50% or more of the IPO to
| the financier's best buddies was a good thing. And in their
| greed, the founders gladly went along, screwing themselves and
| their employees in the process.
|
| (Theoretically, the underwriters are granted a pop because of
| the risk they theoretically undertake. But by the time the IPO
| occurs, the underwriter has already lined up sufficient buyers
| and there is no longer much if any risk, certainly not a level
| of risk justifying most of the gains of the IPO).
| dlp211 wrote:
| The VCs and founders still have plenty of their shares to cash
| in.
| misiti3780 wrote:
| sure - but someone fucked up right? the bankers ?
| gamblor956 wrote:
| Yes, if a company gains significantly (or drops
| significantly) in an IPO, the underwriter royally fucked
| up.
|
| In the old days, there would have been recriminations.
| These days, people just shrug and think it's acceptable
| that the financiers lock up most of the gains for economic
| value created (or, depending on your thoughts of Airbnb's
| business model, acquired) by others.
|
| It's one of the reasons Wall Street has fought so hard to
| prevent become fiduciaries again. If they were fiduciaries
| they couldn't get away with crap like this.
| dlp211 wrote:
| Not in anyway an authority on this, but I don't think so.
| They have to price the stock based on fundamentals and make
| a best guess. Would a different bank have priced it higher?
| Maybe marginally, but probably not double or more.
|
| Maybe someone with a better understanding can say something
| here but it seems like the way we do IPOs is not great. I'm
| not sure how to do it better, but I'm sure that there is a
| better way to do it. I guess this should be the next
| yCombinator startup. Disrupting the IPO landscape :P.
| ignoramous wrote:
| These are the positives I took from this post:
|
| - _Grit and formidability_. "They did nothing half-way, and we
| could sense this even in the interview." If one doesn't feel so
| strongly about the problem they're trying to solve, it is going
| to be hard to sustain the energy needed for the effort required.
|
| - _The founding team is key_. "We didn't even like the idea that
| much. Nor did users, at that stage; they had no growth." Despite
| the "startups = growth" truism, it is refreshing to see that one
| of YC's biggest exits had no such trait even after a year of work
| (when they decided to fund them in W09) apart from the fact that
| the founding team was relentless.
|
| - _Momentum is everything_. "No one ever worked harder during YC
| than the Airbnbs did. If you suggested an idea to them in office
| hours, the next time you talked to them they'd not only have
| implemented it, but also implemented two new ideas they had in
| the process." This may sound easy but it is so hard to do in
| practice (speaking from experience) because of the discipline and
| focus it requires to keep moving the needle a bit more every day.
|
| - _Don 't let rejections break you_ [0]. "One investor they met
| in a cafe walked out in the middle of meeting with them." Again,
| it so very easy to let rejections get to you despite trying your
| hardest to not be bothered by them. You start to question all
| kinds of things which isn't a healthy thing to do but it is kind
| of inevitable because the disillusionment hits so hard.
|
| - _Live in the future. Care enough to make it happen_. "When
| they first tried renting out airbeds on their floor during a
| design convention, all they were hoping for was to make enough
| money to pay their rent that month. But something surprising
| happened: they enjoyed having those first three guests staying
| with them. And the guests enjoyed it too... That experience was
| why the Airbnbs didn't give up. They knew they'd discovered
| something. They'd seen a glimpse of the future, and they couldn't
| let it go." The Airbnbs weren't the first to realise this [1] but
| they cared enough about making this work at a scale never done
| before [2].
|
| - _Know your metrics of goodness and identify how to hit them_
| [3]. "They knew that once people tried staying in what is now
| called 'an airbnb,' they would also realize that this was the
| future. But only if they tried it, and they weren't. That was the
| problem during Y Combinator: to get growth started. The way to
| get growth started in something like Airbnb is to focus on the
| hottest subset of the market. If you can get growth started
| there, it will spread to the rest. When I asked the Airbnbs where
| there was most demand, they knew from searches: New York City. So
| they focused on New York." If I take the liberty to draw
| parallels with Amazon's founding [4], Jeff Bezos (who
| incidentally is an early Airbnb investor himself) chose Seattle
| for a reason (taxes and tech talent). He chose Books for a reason
| (warehouse-ability, shippability). He chose to be online-only for
| a reason (low costs and reach). Again, easy in retrospect, but
| requires non trivial amount of insights and delibration when
| starting up. And it is all too easy to overthink this and get
| lost in a quagmire. Drinking the _kool-aid_ , as it were.
|
| Survivorship Bias or not, I think Paul would be the first to
| point out that every startup is different.
|
| [0] https://medium.com/@bchesky/7-rejections-7d894cbaa084
|
| [1] VRBO, HomeAway, CouchSurfing...
|
| [2] https://www.linkedin.com/pulse/airbnb-didnt-create-brand-
| new...
|
| [3] https://www.artima.com/weblogs/viewpost.jsp?thread=24807
|
| [4] https://www.youtube-nocookie.com/embed/rWRbTnE1PEM
| tristanj wrote:
| For those who haven't seen, here are some excerpts from AirBed
| and Breakfast's Application to Y Combinator.
|
| https://i.imgur.com/55yP1CZ.jpg
|
| This is from the Harvard Business School case study on Airbnb.
| sambroner wrote:
| Those are really cool, fun answers.
| ignoramous wrote:
| Mirror: https://archive.vn/Ygn2f
| conanbatt wrote:
| Thats a great application
| subsubzero wrote:
| I love this story, I never knew how close to failing airbnb was,
| it just shows that with enough hard work, a decent business plan,
| intelligence, and some optimism anything is possible. Also, alot
| of luck, airbnb is one company that did make it, what isn't being
| said is the graveyard of thousands of companies that were not so
| lucky in similar situations.
| breck wrote:
| I had the incredible good fortune to not only be in the same YC
| batch as Airbnb, but also be the only other founder in SF, which
| meant I just happened to carpool a lot with them and hang at
| their place a lot.
|
| I still remember when Nate first told me the idea at our first
| batch meeting and I immediately loved it--at the time I lived in
| a 4-br house with ~10 people, and we constantly had people on the
| couches or in a tent on the roof. I would go on to make more
| money thanks to the Airbnbs during my YC year than I would from
| my own startup.
|
| But a million times more valuable than money was the path that
| those guys sent me down. Sure, we both had gotten into YC, but I
| could immediately sense there was a huge gap between us. I think
| I've always had a strong work ethic and desire to serve others,
| but I didn't have the craftsmanship or teamwork skills that these
| guys had--and they had it in spades. Everyone talks about the
| cereals, but their apartment had more impressive things they
| designed and built than that (IMO). Nate was a no non-sense
| engineer who took software seriously and built great things. His
| code was far beyond mine at the time. And the team work was
| incredible.
|
| I dabbled with joining Airbnb early, but never went down that
| path. I like to joke with my friends that I turned them down, but
| in reality it wasn't because I had better options, the truth is I
| knew they were out of my league skills wise, and I had a long way
| to go to catch up.
|
| The lesson that I learned from the Airbnbs that I think isn't
| always stressed enough in the "power law startup world" is that
| you need to be building many, many things--with other people--,
| and get really, really good at that, before you can go on and
| "make something people want" and do something world changing,
| like these guys have done.
|
| I'll never forget driving home in the dark after our Tuesday
| night dinners in a rental van, the 3 airbnbs and me. After hours
| of loud demos about their new stuff and listening to everyone in
| the room about how they could build things better, the drive home
| would be quiet. You could tell that they were utterly exhausted,
| but also quietly determined. I doubt that they will stop and rest
| enough to celebrate this moment, but they "earned this" moment.
|
| They're the real deal. To this day continually inspired by them.
| hiimtroymclure wrote:
| I enjoyed reading your reflection of that experience with them!
| hn_throwaway_99 wrote:
| Thank you so much for sharing this post. I admit that I'm a bit
| dismayed that so many of the top comments on this thread (on a
| website that's all about sharing ideas re: technology startups,
| no less) are basically just a gripe session.
|
| Virtually everything I've heard from people who have actual,
| personal interactions with the AirBnB founders is positive, and
| especially that their interactions were inspiring - that is,
| the AirBnB founders inspired people around them to do better
| work. I just think that's an amazing quality and something I'm
| so grateful for when I find it.
|
| Sure, I may have my own gripes about AirBnB, but I can
| certainly appreciate the unique combination of talent in the
| founders that made their success possible.
| webdood90 wrote:
| Both things can be true.
| bengale wrote:
| I had similar feelings about a lot of top comments in here,
| and more generally about this place recently. I don't know if
| it's just an influx of users but things feel different these
| days.
| abakker wrote:
| There's a bit of the echo chamber, too. I for one don't
| read enough positive posts, and yet it is these
| remembrances and positive feelings about the work so many
| of us do that makes it feel worth it. If HN was all
| positive, it wouldn't work, but it seems at its best (to
| me) when it is equal parts enthusiasm, optimism, and
| criticism.
| randomsearch wrote:
| Hang on, isn't it simply: "the AirBnB founders were great
| entrepreneurs" vs "yes but look at what the actual impact of
| AirBnB has been"?
|
| It's fine to acknowledge they are remarkable people, but it's
| also ok to say that the success of AirBnB has had huge
| negative consequences for many people. And it's hard to see
| how the former can outweigh the latter.
| rhizome wrote:
| I believe you that they had their pitch fleshed out once they
| got moving, but from someone who, in a way, wished someone
| would invent AirBNB for _years_ , I can't imagine the original
| inspiration was any more complicated than "VRBO's website
| fucking sucks, and has, for a long time."
| godot wrote:
| Let me know if I interpreted you incorrectly, but I think you
| mean that VRBO has existed for longer and has a poor
| product/UX so they needed to be disrupted.
|
| I think it may be easy to compare the two now, but back in
| the days they were fairly different. I was a fairly early
| user of Airbnb (they opened at a time when I was young and
| traveled a lot, especially solo). During those days, Airbnb
| was truly about renting out extra space in your own home.
| (Maybe not an "airbed" every time, but just a room in your
| house/apartment, nonetheless) All of my early usages of
| Airbnb (as a guest -- I was never a host) were actually
| renting rooms in these strangers' apartments, that they live
| in themselves. This was in France, Italy, Brazil, etc. It's
| not about vacation houses in popular resort places (Lake
| Tahoe etc.). In fact, I remember back in the days there was a
| lot of comparison of Airbnb and Couchsurfing. One is paid and
| one is free, sure, but both were very much about meeting
| folks locally.
| borski wrote:
| Precisely. Same space, distinctly different product and
| vision/goals.
| borski wrote:
| They weren't originally going after VRBO's market; remember,
| these were originally _literally_ airbeds.
| [deleted]
| d3ntb3ev1l wrote:
| Where does it end? Renting my house because Airbnb says it's
| "enabling owners." At whose expense? The neighbors who know live
| near a hotel of daily guests, partying when it wasn't zoned for
| it.
|
| Why? Because Silicon Valley says it's cool?
|
| What's next, an owner opening a hair salon, not needing a permit
| or zoning "because rights and freedom"
|
| Airbnb destroys neighborhoods , is a direct cause in many areas
| of decreased available long term housing.
|
| In certain areas maybe. Overall it's enabled more terrible
| situations than it helps.
|
| It only drives greed and profit at the expense of community.
|
| The data is all there for anyone to objectively analyze , but now
| they all counting their profit
| mdoms wrote:
| Hope you have an extroverted personality type and express you
| energy fully externally, other Paul G doesn't wanna know about
| you.
| safog wrote:
| I wonder if there's ever a successful company that upsets the
| status-quo that does not have people vehemently against them.
|
| It's also kind of strange for me to see this level of conviction
| against a company that rents out rooms while barely commenting on
| others that are involved in so much worse ranging from human
| trafficking and modern slavery to global warming, corruption and
| extreme waste.
| pacamara619 wrote:
| I really love their customer service. Since it's not possible to
| delete your account from whithin the settings (after disagreeing
| with updated ToS) I had to contact them. It only took me 16
| emails and 27 days to delete my account! Very efficient! /s
| dnprock wrote:
| The Airbnb experience seem like a good story if it's done
| voluntarily. But now we have a giant corporation "scaling" it. It
| seems like a good business use-case. But we already had Big Tech
| eating up the news. We may have Big Tech eating up the housing
| market. Can someone with knowledge in this space explain where
| this space is heading?
|
| Will the kind of Airbnb business inflate the housing market?
|
| Do people need to rent out their private living spaces in the
| future because paying for a property would become expensive?
| enriquto wrote:
| > When you talked to the Airbnbs, they took notes.
|
| I don't like to do that, but here pg sounds quite egomaniacal
| (which he probably isn't, but still).
| sixhobbits wrote:
| Glorifying the binder full of maxed out credit cards here without
| even a hint of a mention of survivorship bias seems
| irresponsible. I'll happily believe that most successful high
| growth startups have a "never give up" attitude but it's human
| psychology for readers to ignore the thousands or millions of
| similar people who failed and had to deal with that binder in
| spite of the same attitude and energy.
| victorevector wrote:
| Everyone wants to be that 1 in 10 lottery winner :) Every hero
| needs to conquer some villain (e.g. credit card debt). It makes
| the victory that much sweeter.
| lotsofpulp wrote:
| I especially like
|
| > Any normal person would have given up already.
|
| I'd be interested to see how "normal" the kind of fall back
| options these founders had.
| jariel wrote:
| Upper middle class is the sweet spot for these things. Not
| spoiled rich, but definitely no existential worries, probably
| some/mostly private schools. 'Good' parenting.
|
| I don't feel any of these successful founder kids had
| anything handed to them, however, they generally have a
| 'nice, clean journey' from birth to founding whereas most
| people face bumps, barriers etc..
|
| But it's also a little unfair to generalize and there are
| absolutely opportunities for all types.
| gowld wrote:
| That's still pretty "spoiled". Esepcially if we're looking
| at $200k in high school tuition that could be put toward
| business startup capital.
| jariel wrote:
| A good opportunity for education is not 'spoiled' , it's
| fortunate.
|
| 'Spoiled' is the Lambo in high school for the kid with
| bad grades.
|
| Moreover, most private HS are not considerably better
| than good public schools, there are advantages but not
| giant leaps there.
|
| Much more advantageous is private College, but it's
| somewhat more competitive and at least partly
| meritocratic.
|
| These kids are not from massive homes, with baller cars
| and 1M follower instagram accounts. They don't have
| chefs, their Uncles are not Senators. They live in the
| suburbs in slightly better than normal homes, their
| parents drive Audis and they do their homework. They had
| braces as kids, and never had to worry about healthcare.
| Their 'Dentist' father is not 'connected'. They are
| really not that different from most kids, other than they
| never have to worry.
| lotsofpulp wrote:
| The private HS advantages are rubbing shoulders with
| other kids whose parents can afford private HS. You're
| much more likely to meet friends whose parents are in a
| position such that your friend can max out their credit
| cards.
|
| Same is not true of any private college, since the
| government hands out loans without discretion to anyone.
| A selective college, however, offers you similar
| benefits.
| [deleted]
| Applejinx wrote:
| Does it matter if there are bad grades? Is the difference
| between bad grades, and exceptional grades, a good reason
| to set a kid up with Lambo-grade back-up as far as
| resources and access to capital?
|
| I think it's pretty natural, if your resources are
| exceptional, to treat that as extending to your immediate
| family. Therefore it doesn't matter what grades the kid
| gets because there is nothing they can possibly do that's
| more important than being your kid, and so they'll
| automatically be your kid and have access to the
| resources of your family unit.
|
| I don't see a special moral dispensation for, 'this kid
| APPLIED himself and therefore it's okay that he never had
| to worry'.
| solumos wrote:
| Well, we can certainly speculate:
|
| Chesky - Both parents are social workers, probably would have
| been in a rough spot taking on that debt. Would have moved
| somewhere else and gone back into industrial design.
|
| Gebbia - Father is/was a successful businessman in the
| Atlanta area, currently a city councilman. Probably would
| have been better off than Chesky, but the debt probably still
| would have stung. Would have gone back into industrial
| design.
|
| Blecharczyk - Upper middle class family + Harvard alum.
| Taking on the debt might have been painful, but he probably
| would have been fine eventually, especially with his
| technical background.
|
| I don't think their fall-back options were great. If they had
| "rich uncles" or something, I don't think they would have
| needed to max out credit cards in the first place. I think
| Chesky's level of conviction was simply unwavering. I'm
| certain there are much more affluent people who would have
| given up sooner.
| newnamenewface wrote:
| Two were middle class and attended RISD and the third came
| from wealth and attended Harvard. I'm sure they all could've
| fallen back on parents to some extent (the wealthy one
| especially) but it's not like that's a atypical distribution
| of wealth among a group of three college educated people
| (which is I'm guessing the typical start up demographic).
| shuckles wrote:
| For better or worse, the startup mentality and YC's content
| marketing reaches far more than elite college graduates
| these days.
| timr wrote:
| > I'd be interested to see how "normal" the kind of fall back
| options these founders had.
|
| My history in SF weirdly intertwines with AirBnB. I first met
| them in 2007, at an "unofficial startup school afterparty"
| (this was before they were funded by YC). The party consisted
| of Brian and (IIRC) Joe, and a couple of bottles of booze and
| some soda in their apartment (the one they rented out to the
| first guests). Let me just say that they weren't living in
| luxury: there were mattresses on the floor. The only notable
| piece of furniture in the place was a table, and a bookshelf
| filled with white, blank-covered book galleys that Brian had
| gotten for free from some print-industry connection.
|
| I then worked at Justin.tv when these guys were getting
| advice from Michael and eating lunch with us on a regular
| basis. I bought them drinks because they were broke. The
| unsold Obama-O's boxes were sitting around the office.
|
| I'm as cynical as the next guy about the relative well-off-
| ness of a lot of startup founders these days, and I don't
| have any personal insight into their finances at that time.
| That said, as much as anyone in SF in 2008 had no fallback
| plan, the AirBnB founders seem to fit the bill.
| breck wrote:
| I disagree about the fallback plan.
|
| Please people, do not max out your credit cards, at least
| not until you are as good as what you do as they Airbnbs
| were in 2008.
|
| I think there's a cognitive bias at YC where they don't
| realize that most people (especially 20 year olds) are not
| very good at making things, and so on average the best
| advice you can give the general public is just to get
| better at making things.
|
| The Airbnbs were exceptionally skilled and hard working
| people. They made all sorts of weird stuff--and did it
| well. The cereal boxes were the tip of the iceberg. Brian
| and Joe could design (and throw a good party!). Nate was a
| terrific coder who did CS at Harvard.
|
| I would absolutely say they had the best fallback plan--
| they could make things. They could've gotten other jobs.
| That takes decades of hard work (I'm sure they started
| building things when they were very young).
|
| So if you can't make good things, DO NOT max out your
| credit cards. You will be setting yourself up for disaster.
| Instead invest in your skillset. If you aren't good enough
| to build something great, go out and get a job(s) and keep
| working on it.
|
| I like a poem written in 1916 about being someone who
| "delivers the goods" (https://breckyunits.com/deliver.html)
| lotsofpulp wrote:
| I'm sure they might not have had silver spoons, but maxing
| out your credit cards is a luxury that people have when
| they don't have families to support (not to mention moving
| to SF). I'm not just referring to your own children, but if
| you have parents that need help, or siblings that need
| help.
|
| For example, if I was in these 3 gentlemen's shoes, I would
| have not maxed out my credit cards, because my parents were
| entering their 50s and they didn't have gold plated health
| insurance from government or a F500 company, so I knew I
| had to play it safe and be ready to be there if and when
| they need me for assistance with healthcare expenses.
|
| I don't mean to detract from any of their achievements,
| surely they put forth effort into getting into the right
| schools, studying the right subjects, and focusing their
| energy on something that netted them a very high ROI.
|
| The purpose of my comment was to shine a light on how being
| in a position to max out credit cards in SF in the first
| place without greatly negatively altering your family's
| trajectory qualifies you as "normal" in a very restricted
| sense of the word "normal".
| neilv wrote:
| I've done the scary fistful of personal credit cards _twice_
| , while starting businesses, in addition to burning through
| personal savings, and strongly disrecommend it. I had no
| family safety net as a fallback, and had to pay off the cards
| in full, Lanister-style, including all the predatory 29.99%
| APR interest that kicked in on one when I was accidentally
| late on a payment.
|
| Funny: Sometime after paying off the first time, I was
| talking with a CSR at one of the credit card companies, and
| she looked at my account, and said, kinda awkwardly and with
| surprise, "You've been a _very_ profitable customer... ". I'm
| pretty sure that's not in any script. :) But I did have a
| stellar credit score by then.
|
| One of my businesses did some great and beneficial work that
| I feel really good about, but I should've used angel/seed
| investors from the start. That would've made things a lot
| less painful, helped me formulate a more profitable business,
| and helped the second business actually get all the way to
| launch before I couldn't stomach any more fistfuls of
| personal debt.
|
| How I see it now: no matter how much I'd prefer to focus
| solely on product and engineering, and not having to play
| business-person with investors, investors are so much more
| preferable to self-funding a startup as a non-wealthy person.
| If you can't convince investors, I'd advise being very
| skeptical of a survivor bias story from Airbnb, and instead
| find a way to modify or explain the business to convince
| investors. (You could just tell them: "we'll make money by
| disregarding existing regulations for a market, undercutting
| the competition." :)
| gowld wrote:
| I don't think it's predatory when you use a credit card for
| high-risk debt instead of getting a loan approved include a
| creditworthiness review.
| offtop5 wrote:
| Unless you're already known in your industry investors
| aren't exactly lining up to write checks.
|
| For my current passion project, a video game , I plan on
| dumping between 10 to 20k in before trying to pitch it to
| publishers. When that likely fails I'm going to self
| publish , I really really enjoy programing with Unity so
| I'm not too worried about making my money back.
|
| I can't imagine anyone who's not well connected can walk
| into an industry conference and walk out with a seed round
| cvhashim wrote:
| Like the other user said. Make a landing page and accept
| emails for sign up and updating followers on news. This
| does two things: you sort of validate the idea and you
| also get some followers who provide a little bit of
| motivation (or pressure) to get you to deliver sooner.
|
| https://www.indiehackers.com/post/how-to-brainstorm-
| great-bu...
| danenania wrote:
| A bit of unsolicited advice: before putting money in _or_
| pitching to publishers, make a simple static site with a
| mailing list sign up form, then promote it and run some
| ads for it.
|
| If you get positive feedback and a bunch of sign ups,
| proceed. Otherwise iterate on the
| concept/website/marketing strategy until it clicks, then
| continue with your plans.
| offtop5 wrote:
| The static site is already up, but I don't get why I'd
| buy ads before creating an actual product to show.
|
| I guess you can see a YouTube video of my prototype on
| the static site ?
| danenania wrote:
| The point is just to get some traffic somehow so you can
| check whether anyone wants to play the game you're about
| to spend tons of time and money on. Ads are a simple way
| to drive some traffic. If you can't get clicks or sign
| ups, you will save yourself a really bad time by figuring
| that out _before_ starting to build, and iterating to a
| better concept /pitch that is validated by real potential
| users.
|
| And yeah a prototype video sounds like a great way to
| test people's enthusiasm.
| offtop5 wrote:
| Okay, I really need to spend a bit more time before I'd
| feel comfortable doing that but I'll definitely take your
| advice to advertise it sooner rather than later.
| cody3222 wrote:
| It's pretty obvious that collecting a binder full of maxed out
| credit cards is a bad idea that most would avoid. The point PG
| is making is one of contrast - despite how dumb this is, they
| did it anyways (and it happened to pay off). He's not endorsing
| this action.
|
| Why can't we get back to a place of finding the good in every
| story/person instead of trying to tell everyone that they're
| doing something wrong?
|
| Also, holy cow! From credit card debt to billions. It makes the
| story that much better!
| nickelcitymario wrote:
| > From credit card debt to billions...
|
| ...of also debt. 2.2 billion.
|
| I struggle to understand how their expenses are so high. Or
| why investors are happy to keep buying into a company that
| has failed to ever be profitable. Look at the cap tables.
| They've gone into massive deficit every year running an app.
| A $3B/year app.
| cody3222 wrote:
| Would you rather invest in a $1B / year company that has a
| 10% profit margin and is growing 10% YoY or A company that
| is doing $1B / year with a 10% loss due to investment in
| growth but is growing at 30% YoY?
|
| Both options are reasonable investment strategies but for
| folks who will take a gamble to have a bigger pie, #1 is
| pretty reasonable. Especially if you can later cut costs
| and still have that 10% profit margin.
| exolymph wrote:
| One possible takeaway is that crazy risk tolerance = table
| stakes.
| jacquesm wrote:
| Exactly. Or the ones that ended up losing it all, including
| their shirts, relationships and in some cases their lives.
| spaetzleesser wrote:
| There is a big difference between burning through your money
| knowing that your dad can eventually save you vs ending up
| complete broke and needing years to recover if you fail. My
| observation that a lot of startup founders who burn through
| credit cards and eat ramen noodles still have the knowledge
| that their well off family has the ability to save them. They
| work hard and sacrifice a lot but they aren't risking their
| livelihood for years to come and won't go homeless.
| purple_ferret wrote:
| >What was special about the Airbnbs was how earnest they were.
|
| So earnest. Their inability to police fraudulent/scam listings.
| It comes from a place of earnest conviction. Their blatant
| attempts to circumvent and disregard local laws about illegal
| hotel listings. It comes from a place of earnest conviction.
|
| Why is there always a need to sugarcoat these bio pieces like
| they're describing somebody in line for canonization?
|
| The Doordash piece was even worse.
| TigeriusKirk wrote:
| It's not a bio piece.
|
| It's a post specifically focused on why someone thinks a
| certain team succeeded.
|
| Given that, of course it's about positive traits.
| MereInterest wrote:
| Why? I think AirBnb, Uber, and DoorDash have all succeeded
| primarily due to flaunting of social norms and fair
| employment regulations, treating them as externalities to be
| exploited, rather than social fabric that we can rely on. Why
| would a piece about why they succeeded necessarily forgo
| these critical parts to their immorally obtained success?
| adlpz wrote:
| Illegally, "allegally", of dubious concordance with the
| spirit of the law, maybe. But immorally? That is very much
| a matter of opinion don't you think?
| MereInterest wrote:
| Damn right it's a matter of opinion. My opinion is that
| the deliberate abuse and exploitation of social niceties
| is immoral. What I don't see is how it being an opinion
| does anything to invalidate it, nor how pointing it out
| is an opinion is expected to convince me against holding
| it.
|
| Edit: Perhaps I am a bit harsh here. I am frustrated
| overall at the general idea that nothing can ever be
| condemned, and morals may not be discussed, merely
| because they include a subjective value judgment. Those
| value judgments occur at all times, and are what give
| importance to the facts.
| TigeriusKirk wrote:
| Fair enough, I need to be more specific about what I
| believe is the point of the piece.
|
| It's intended to give would-be entrepreneurs insight into
| traits of previously successful entrepreneurs. In
| particular traits the writer believes should be emulated.
|
| Those will naturally be positive traits, because the entire
| point of the piece is to give readers something to aim for.
| mikeg8 wrote:
| I don't think Airbnb is in the same boat as the latter two
| in regards to fair employment regulations.
|
| > Flaunting social norms
|
| In the case of Airbnb, what was the social norm? Staying in
| a hotel? Wouldn't _all_ disruption be flaunting social
| norms??
|
| I think applying your own moral standards to a company in
| this way can get precarious. Beside the outlier cases of
| trashed rentals or someone left in the cold (which is
| harmful, but again, a very small percentage of their
| volume), the majority or Airbnb hosts and guests seem to
| find value in their service and choose to use it. How
| immoral is that, in reality?
| parthdesai wrote:
| Have you lived in a city or a building infested with
| Airbnbs? It's a hell for a person to live in a building
| infested with Airbnbs. Also, not to mention that Airbnb
| was one of the major factors in driving rental and
| apartment prices up for long term renters/buyers. I would
| say Airbnb did more harm to actual people living in the
| city than Uber ever did. Airbnb willingly allowed people
| to own multiple properties and just rent them out on
| short term. There is a reason a lot of major cities in
| the world had to pass laws that would restrict people
| from listing their secondary properties on Airbnb and
| even then, I don't think Airbnb enforces those laws at
| all. But hey, they are a YC company and care about how
| people travel, so people eat that bullshit up. At least
| hedge funds don't pretend to be noble and tell us upfront
| that all they care about is making money.
| learc83 wrote:
| > In the case of Airbnb, what was the social norm?
| Staying in a hotel?
|
| The social norm is the expectation that your neighbors
| won't be running a hotel next door.
| trhway wrote:
| seems to be pretty sleazy:
|
| https://www.quora.com/Did-Airbnb-get-sued-for-running-a-
| robo...
|
| "What Airbnb did in 2010 and 2011 was to use a bot to
| spambot to email who had posted short term vacation
| rental ads on Craigslist. The emails claimed to be from
| women who liked their listings, suggesting that they try
| Airbnb. "
| blackrock wrote:
| Interesting. Craigslist uses an anonymous email routing
| mechanism, in order to allow people to contact the ad
| poster. And vice versa.
|
| Does Craigslist actively monitor the messages being
| passed through?
|
| Edit: Why did I get downvoted? It was a legitimate
| question. It may have deviated from the article subject,
| but that's how conversations flow, and how you learn of
| new things.
| CJefferson wrote:
| The hosts and guests find value. The neighbors of the
| hosts often have a miserable time, which is why usually
| zoning laws stop people running hotels wherever they
| like.
| [deleted]
| DanBC wrote:
| > In the case of Airbnb, what was the social norm?
|
| Paying your taxes. AirBnB has managed to avoid VAT by
| pushing that responsibility onto hosts. UK is looking to
| changing this arrangement.
| [deleted]
| conception wrote:
| Because this is ycombinator marketing.
| renewiltord wrote:
| What, really, do you think makes people act a certain way? Do
| you think they're like "I sit on a throne of dead hotelier
| skulls! What is will be no more! Now is the season of EVIL!"?
| Or do you think they earnestly think "Reducing the barrier to
| short-term rentals will make many people happy and make us
| probably very wealthy".
|
| Come on, dude.
| [deleted]
| ivalm wrote:
| Definitely the skulls of dead hoteliers.
| mikestew wrote:
| Given the number of regulations ignored or just outright
| broken, given that I expect to live next to neighbors and not
| a hotel in my suburban neighborhood, given that it is "terms-
| of-service for thee but not for me", I'd go with your first
| choice. 'cuz is sure is hell isn't "let's make the world a
| better place" if that means spamming Craigslist and ignoring
| local zoning laws.
| soulofmischief wrote:
| I had to deal with 4 illegal AirBNB units in my small
| apartment complex. Above me, to the left and right of me.
|
| I had multiple break-in attempts, attempted physical
| altercations and loud parties on weeknights.
|
| Airbnb ignored complaints, my landlord ignored complaints, it
| took Covid-19 to get rid of the parasitical infection on my
| peace of mind.
|
| They certainly are wealthy, but I was not happy. Well-
| intentioned residential zoning laws were ignored at my
| expense.
| wavefunction wrote:
| Personally, I think AirBnB is earnestly happy to cash in on
| the situation where the apartment next to mine that I'm
| paying $1600 a month for is rented out to people who are
| there to loudly party until 6AM on a Wednesday night-Thursday
| morning while I have to get up and go to work and try to have
| some semblance of an intellect available. Fortunately I've
| since purchased a modest house in a quiet neighborhood but
| gorram!
| freewilly1040 wrote:
| People are really good at rationalizing things that make them
| rich. A founder's earnest feelings about their business's
| externalities should never be taken at face value.
| renewiltord wrote:
| > _A founder's earnest feelings about their business's
| externalities should never be taken at face value._
|
| Maybe that's your strategy to VC investing. I don't think
| it's particularly good to apply a zero or negative
| coefficient to this trait. But that's okay, the market
| shall speak on this one.
| cambalache wrote:
| The market only cares about money.
| renewiltord wrote:
| Yes, exactly. And determining leading indicators of what
| will make money is hard. I think smart people will put
| non-zero positive coefficients on the earnestness that YC
| is talking about here.
| treis wrote:
| >So earnest. Their inability to police fraudulent/scam
| listings. It comes from a place of earnest conviction. Their
| blatant attempts to circumvent and disregard local laws about
| illegal hotel listings. It comes from a place of earnest
| conviction.
|
| I don't think that's really fair. AirBnB as originally
| conceived is something that would make the world better for a
| lot of people. Something you can be proud of building. What
| it's turned into is far more of a mixed bag, of course, but
| that doesn't change the earnestness of how it began.
| iuguy wrote:
| > AirBnB as originally conceived is something that would make
| the world better for a lot of people.
|
| Like Couchsurfing before AirBNB destroyed it.
| dheera wrote:
| Yeah. I also recently had an Airbnb host write a negative guest
| review with a bunch of false information. First time this
| happened. Airbnb refuses to remove it, refuses to let me edit
| my response, and there is no concept of due process.
|
| Leaves a bad taste in my mouth to ever use Airbnb again.
| QueensGambit wrote:
| "For the Airbnbs, ramen profitability was $4000 a month: $3500
| for rent, and $500 for food."
|
| As a silicon valley outsider, blood drained from my face after
| reading this. Do you have to starve or raise money only to pay
| rent? I have a profitable business and it scares me to apply to
| YC after reading this.
| ceilingcorner wrote:
| YC doesn't require you to live in the Bay Area after the three
| months are up.
| [deleted]
| jrochkind1 wrote:
| > But something surprising happened: they enjoyed having those
| first three guests staying with them. And the guests enjoyed it
| too. Both they and the guests had done it because they were in a
| sense forced to, and yet they'd all had a great experience...
| That experience was why the Airbnbs didn't give up.
|
| It seems safe to say that the majority of Airbnb use now is not a
| delightful experience of being hosted in someone else's home, but
| whole-apartment/house rentals or other circumstances with not
| much interaction between host and guest, feeling very business-
| like. No? I don't it's common to especially enjoy it as an
| experience anymore, it's just a way to make money or a way to
| find a nice place to stay at a good price.
|
| If that delightful hosting experience is what inspired them to
| keep going... it's still not what the company mostly ended up
| providing to the world. If we were to weigh the pro- and anti-
| social aspects of airbnb, that pleasant human relationship
| between host and guest would barely weigh on the scale, because
| it's mostly not what happens there anymore. The founders don't
| seem that concerned about that though, do they?
|
| So what do we take from all that? It seems odd to me to highlight
| that aspect of the founders initial motivation without even
| mentioning whether that's what the company actually does now.
| gamblor956 wrote:
| AirBnB was always a regulatory arbitrage play.
| oblio wrote:
| Or in layman's terms: find a legal grey area and become a
| billionaire before it becomes illegal.
|
| Was it Ford that said: don't ask me how I made my first
| million?
| heavyset_go wrote:
| Before the pandemic, Manhattan was filled with apartments that
| had every room turned into bedrooms that were rented out on
| AirBnB and that violated fire code. Now cities are filled with
| literal flophouses.
| gowld wrote:
| That's the retconned origin story. From the start they were
| talking about replacing Marriott; that was their pitch to
| investors.
| jrochkind1 wrote:
| Well, that would be even worse, as far as why Paul Graham
| chooses to tell the story this way, even make it the center
| of the story. I guess that's how he remembers it.
|
| Either way, it's not what it is now, and he's choosing not to
| mention that, while leaving it at the center of the story...
| d_burfoot wrote:
| One of the things I think is overlooked in stories about AirBNB
| is how bad the idea conjured by the explicit meaning of the name
| _airbed_ and breakfast. Airbeds are a terrible guest experience:
| you have no privacy, no reserved space, you 're sharing a
| bathroom, and you probably have a backache when you wake up.
| Almost no one on AirBNB actually offers airbeds. It's not until
| you parse "AirBNB" as something completely unrelated to airbeds
| that you start to think it might be a good idea.
| nrmitchi wrote:
| > They'd been funding the company with credit cards. They had a
| binder full of credit cards they'd maxed out.
|
| In my opinion, this kind of behaviour needs to stop being
| glorified. 99 out of 100 times this does not end with a billion-
| dollar company, but rather with someone drowning in personal
| debt.
|
| The only "acceptable" time you can really run up a literal binder
| full of credit card debt is when you have a very easy safety-net
| to fall back in to, which again, does not apply to the large
| majority of people who would find this "came from nothing" story
| inspiring.
| spaetzleesser wrote:
| A lot of founders have a well off family that bails them out if
| they fail. This is something I learned only after my self
| financed startup failed and left me with debt for more than 10
| years.
| jacquesm wrote:
| Exactly. It's a very pure case of survivorship bias. If you go
| down the route of collecting a folder full of maxed out credit
| cards your likely future is foodstamps or living on the street,
| not being a billionaire.
| nrmitchi wrote:
| Further, it makes me question _how did they get a binder full
| of maxed out credit cards_?
|
| I get that times were different in 2008, but who was giving
| them all of these cards with no income and a stack of
| already-maxed-out cards.
| GlenTheMachine wrote:
| Do you _remember_ 2008?
|
| I do. Credit cards weren't hard to get. Even if you were in
| debt up to your eyeballs. I know because I was, and I could
| still get new credit cards.
|
| It took a credit management service and ten years of steady
| payments, but I'm now out of (consumer) debt. Thankfully.
|
| <Edit> Sorry if the above sounded snarky. Being that much
| in debt still evokes some painful memories.
| nrmitchi wrote:
| > Do you remember 2008?
|
| Honestly, I was in high school. So, no, not really. There
| were other reasons that no one would give me a credit
| card.
|
| > It took a credit management service and ten years of
| steady payments, but I'm now out of (consumer) debt.
| Thankfully.
|
| Wait, you mean the binder full of credit cards didn't
| work out to a billion-dollar company for you?!? That
| sucks. I guess we're 1 for 2 on that one today.... 50%
| chance of success. /s
| GlenTheMachine wrote:
| I had income, and I wasn't like a million dollars in
| debt, just $100,000. But I was barely making my mortgage
| payment and I was getting new credit card applications in
| the mail every week.
| gowld wrote:
| How do you even get a binder full of credit cards? Isn't the
| point of credit checks that you _can 't_ get a "binder full" to
| circumvent the credit risk you pose?
| solumos wrote:
| 3 people, ~12 cards each - that's about a binder of cards,
| I'd say. If they had good credit to begin with, it would take
| some time for it to degrade.
| ignoramous wrote:
| Paul does mention the Airbnbs did so because "they had seen the
| future and couldn't let go."
|
| Sounds to me like it was a calculated risk they needed to take.
|
| Also see Paul's point on how the Airbnbs would have given up
| incase "this Y Combinator does not work out."
| xwdv wrote:
| So much rewritten history in this article. Ycombinator has no
| credibility anymore IMO.
|
| The moral of the AirBnB story is basically: Do illegal shit, laws
| be damned and also rack up a ton of bad debt. If you succeed
| you'll have so much investor money that not only will you believe
| to be above the law, but the law will begin to believe you. And
| if you fail? Well fuck you thats your problem now you're probably
| going to prison and having a shitty credit score forever but
| thank you, next.
|
| And people wonder why I'm so willing to abandon morals and ethics
| in the pursuit of dollars. Look at this world.
| 9HZZRfNlpR wrote:
| PG will throw a rainbow flag somewhere on his site and the sins
| are redeemed!
| slg wrote:
| No mention of how this business was built on the back of people
| running illegal hotels. It wasn't hard work or passion that
| allowed these guys to become billionaires. It was finding a niche
| in the market that was regulated out due to a combination of
| valid consumer safety concerns and regulatory capture, targeting
| that market, ignoring the law when it didn't suit them, and
| getting large enough by the time the law caught up it was no
| longer politically feasible to kill the company. It is the same
| process that other tech companies have gone down such as Uber.
| lipanski wrote:
| Airbnb enabled a great range of people to see places they might
| have never afforded to see before. It managed to commoditize
| travelling in a similar way low-cost airlines did. On top of
| that, it enabled regions with no previous tourism revenue to
| have a slice of the cake. Sure, the company made a good profit
| while there was a profit to make, but their service benefited
| consumers as well and I think it did leave a positive impact
| not only on the travellers but also on some of the communities
| that understood how to balance its pros and cons.
| dabeeeenster wrote:
| They are also scrupulous tax avoiders in the UK. Pay your fair
| fucking share.
| natchy wrote:
| IMO its in the public's interest to not suffocate startups.
| different story now that they've IPO'd.
| oh_sigh wrote:
| Do you not take any legal deductions on the taxes you pay?
| I'd imagine you are a tax avoider too.
| [deleted]
| samirillian wrote:
| With the sad result of contributing to rent inflating well
| beyond peoples' means. We are in the midst of a pretty grim
| housing crisis. Almost 70k homeless in LA. This doesn't make
| anyone involved a bad person, but we must recognize how this
| company has contributed to a structural crisis. Can't say I
| know the solution myself, but.
| ztratar wrote:
| Same thing happened with many of the first car manufacturers,
| electricity providers (Edison getting localities to ban
| alternating current), etc.
|
| In many areas the Airbnbs were not illegal, and sometimes
| "regulatory capture" should be fought as unjust.
|
| Of course, in other areas, you're totally right that sometimes
| the local regulations should win, the company fined, etc. All
| depends on what the local community wants, imo.
| slg wrote:
| >sometimes "regulatory capture" should be fought as unjust.
|
| The problem is that Airbnb was the one deciding what laws to
| ignore. Odds are the group of laws they considered regulatory
| capture were much bigger than the group of laws that were
| considered regulatory capture by consumer protections groups.
| There is not a clear delineation between what laws truly
| protect people and what laws only give that appearance. The
| proper way to fight regulatory capture is through the
| political system.
|
| The "It's easier to ask forgiveness than it is to get
| permission" mindset can be dangerous when it is applied to
| issues of public safety.
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