5 ms·

The Billion-Dollar Startup That Almost Never Was

56 points by turoczy 15y ago

npollock 15y ago
Any startup that relies on the network effect to provide value is a daunting challenge. Your product can be amazing, but without the right user acquisition strategy, you'll be left spinning your wheels. Kudos to the AirBNB team for having the vision and determination not to quit.
- brandnewlow 15y ago
  Unfortunately, the article never explains what that strategy was. "Getting into YCombinator" is posited as the solution to their problems, yet "getting into YCombinator" is not a user acquisition strategy.
  - deleted 15y ago
    [deleted]
  - VladRussian 15y ago
    >the article never explains what that strategy was. if memory serves me right it was already discussed here. Just google "airbnb craigslist spam". They admitted it themselves : http://venturebeat.com/2011/06/02/airbnb-admits-gaming-craigslist/ http://venturebeat.com/2011/06/02/airbnb-admits-gaming-craig...
imjk 15y ago
Is this a story about a story, from the same day?
- ninjoah 15y ago
  Yeah, where's the beef?
dougws 15y ago
Seems like most successful companies of any kind "almost never were." Is there any company that was successful right from the beginning, with no real hurdles?
- SatvikBeri 15y ago
  Depends on what you mean by successful. I know a small company that makes about $300-500k per person year and several smaller ones in the range of $100k per year that never had any major problems. They are not particularly interesting stories, so you'd probably never hear about them otherwise.
  - pbhjpbhj 15y ago
    >I know a small company that makes about $300-500k per person year I'm interested ... go on.
    - thomaslangston 15y ago
      Personal anecdote, a family friend sells Usenet access. Seems to be doing very well. Probably the same things that make him successful is the same thing that made my father's business (commercial roofer) so profitable. 1) Unsexy markets. They don't attract competition. 2) Be your own salesperson/secretary/accountant/marketer/janitor/2-3 (cable/roof) monkeys. You don't have to hire bodies if you don't want to and you'll often work harder when it is your bacon on the line.
    - SatvikBeri 15y ago
      One basically puts public domain information online in searchable form and gets massive traffic + ad revenue. Took a while to set up, very boring, but very easy to maintain. Note that being the first mover was very important, the #2 competitor for these niches gets about 20% of the traffic of the winner (and I assume 20% of the revenue). Another one literally finds links for a particular political topic and sells the combination of links at something like $1000/month. I have no idea why they're so successful-their process consists of Googling said topic for a few hours a week and posting the links on their website-but somehow it works. Like ThomasLangston mentioned, unsexy markets really work, because you're not competing with the best and the brightest...in fact, you're often not competing with anybody.
hnsmurf 15y ago
Interesting that it doesn't mention the craigslist spamming. I'd wager that's far more responsible than YC. As great as YC is for many things it's not a significant source of traction for most startups.
- Timothee 15y ago
  It's mentioned through that part: "Airbnb contracted outside sales people to generate leads". This was pretty much the response from the company to the craigslist spamming story. To be honest, while reading that line, I thought it was slightly odd because it was pretty specific (e.g. "outside" could be removed, but it clearly distances Airbnb from said sales people) and didn't necessarily bring anything to the story, especially since Airbnb has said the efforts were "largely ineffective". The cynic in me feels that it was included specifically to add weight to the company's response about that craigslist story.
nswanberg 15y ago
The cereal fundraising story is mentioned here as evidence of desperation, which it might have been, but Fred Wilson paints the move as an indicator of a great entrepreneur: http://www.avc.com/a_vc/2011/03/airbnb.html http://www.avc.com/a_vc/2011/03/airbnb.html

56 points by turoczy 15y ago

Any startup that relies on the network effect to provide value is a daunting challenge. Your product can be amazing, but without the right user acquisition strategy, you'll be left spinning your wheels. Kudos to the AirBNB team for having the vision and determination not to quit.

brandnewlow 15y ago
Unfortunately, the article never explains what that strategy was. "Getting into YCombinator" is posited as the solution to their problems, yet "getting into YCombinator" is not a user acquisition strategy.
- deleted 15y ago
  [deleted]
- VladRussian 15y ago
  >the article never explains what that strategy was. if memory serves me right it was already discussed here. Just google "airbnb craigslist spam". They admitted it themselves : http://venturebeat.com/2011/06/02/airbnb-admits-gaming-craigslist/ http://venturebeat.com/2011/06/02/airbnb-admits-gaming-craig...

imjk 15y ago

Is this a story about a story, from the same day?

ninjoah 15y ago
Yeah, where's the beef?

dougws 15y ago

Seems like most successful companies of any kind "almost never were." Is there any company that was successful right from the beginning, with no real hurdles?

SatvikBeri 15y ago
Depends on what you mean by successful. I know a small company that makes about $300-500k per person year and several smaller ones in the range of $100k per year that never had any major problems. They are not particularly interesting stories, so you'd probably never hear about them otherwise.
- pbhjpbhj 15y ago
  >I know a small company that makes about $300-500k per person year I'm interested ... go on.
  - thomaslangston 15y ago
    Personal anecdote, a family friend sells Usenet access. Seems to be doing very well. Probably the same things that make him successful is the same thing that made my father's business (commercial roofer) so profitable. 1) Unsexy markets. They don't attract competition. 2) Be your own salesperson/secretary/accountant/marketer/janitor/2-3 (cable/roof) monkeys. You don't have to hire bodies if you don't want to and you'll often work harder when it is your bacon on the line.
  - SatvikBeri 15y ago
    One basically puts public domain information online in searchable form and gets massive traffic + ad revenue. Took a while to set up, very boring, but very easy to maintain. Note that being the first mover was very important, the #2 competitor for these niches gets about 20% of the traffic of the winner (and I assume 20% of the revenue). Another one literally finds links for a particular political topic and sells the combination of links at something like $1000/month. I have no idea why they're so successful-their process consists of Googling said topic for a few hours a week and posting the links on their website-but somehow it works. Like ThomasLangston mentioned, unsexy markets really work, because you're not competing with the best and the brightest...in fact, you're often not competing with anybody.

hnsmurf 15y ago

Interesting that it doesn't mention the craigslist spamming. I'd wager that's far more responsible than YC. As great as YC is for many things it's not a significant source of traction for most startups.

Timothee 15y ago
It's mentioned through that part: "Airbnb contracted outside sales people to generate leads". This was pretty much the response from the company to the craigslist spamming story. To be honest, while reading that line, I thought it was slightly odd because it was pretty specific (e.g. "outside" could be removed, but it clearly distances Airbnb from said sales people) and didn't necessarily bring anything to the story, especially since Airbnb has said the efforts were "largely ineffective". The cynic in me feels that it was included specifically to add weight to the company's response about that craigslist story.

nswanberg 15y ago

The cereal fundraising story is mentioned here as evidence of desperation, which it might have been, but Fred Wilson paints the move as an indicator of a great entrepreneur: http://www.avc.com/a_vc/2011/03/airbnb.html http://www.avc.com/a_vc/2011/03/airbnb.html