A single tip from an investor helped Airbnb CEO Brian Chesky grow his company from a struggling startup to an industry giant worth around $70 billion.
That’s according to Chesky himself, who told attendees at a recent Stanford Graduate School of Business event that it was “the best advice I’ve ever received.”
The advice: “Focus on getting 100 people to like you, rather than getting a million people to like you,” Chesky said.
It came courtesy of Paul Graham, the co-founder of tech startup accelerator Y Combinator, who advised Airbnb co-founders – Chesky, Joe Gebbia and Nathan Blecharczyk – to focus on a small audience of potential customers as they built their business.
Such a recommendation “actually goes against almost everything everyone says,” Chesky said.
For early Airbnbs, that meant creating experiences for guests that stood apart from staying in a hotel or crashing on a couch. The trio took their research seriously, even hiring a Pixar storyboard artist to help them define what five-star stays would look like from check-in to check-out, Chesky said.
It also meant simultaneously determining what would make guests happy and comfortable. Shortly after launching the business, the trio of co-founders visited a group of Airbnb rentals in New York City to personally photograph listings and better understand host perspectives, Chesky told the “Masters of Scale” podcast. from LinkedIn co-founder Reid Hoffman. in 2017.
The small number of people who deeply enjoyed the Airbnb experience, guests and hosts, became the company’s “marketing department,” Chesky said at the Stanford event.
In his estimation, the strategy worked. In its first decade, Airbnb grew bigger than Hilton, which started in 1919 and currently has a market capitalization of $36.43 billion. Much of that initial growth was due to word-of-mouth marketing, Chesky said.
Unfortunately, Graham also gave the Airbnb co-founders “the worst advice” they’ve ever received, Chesky added – that they would have to move to Mountain View, Calif., where Y Combinator is located, to be successful.
“You don’t need to move [to Silicon Valley]”, Chesky said. “You can be anywhere.”
Airbnb is still based in San Francisco today, but Silicon Valley has seen an exodus of tech companies in recent years, with top companies like Oracle and Hewlett-Packard Enterprise relocating their headquarters out of California in 2020.
That year, San Francisco was only the fifth-best city in the United States to start a business, largely due to its high living expenses, according to data compiled by Inc. magazine. Austin, Texas , leads the rankings, followed by Salt Lake City and Raleigh, North Carolina.
Chesky has also been more broadly advocating for the idea of working from home — or, as you’d expect from Airbnb’s CEO, working from someone else’s home — since at least the start of the pandemic. of Covid-19.
“I guarantee you that a lot of these CEOs calling people back to the office in New York are going to the Hamptons for the summer, or going to Europe in August,” Chesky told The Verge’s “Decoder” podcast earlier this month. -this. .
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