Who wants to sleep in a boring hotel when you can sleep in a treehouse, pass out in a beer barrel or stay in a beagle shaped house? Airbnb connects people and opens the door to new adventures all across the globe.
Airbnb is a marketplace for people to list, discover and book unique accommodations around the world. Guests can book a private room, share a room or even rent out an entire place. After the stay, both guests and hosts can leave reviews about the overall experience, which are based on a completed stay. This control maintains the authenticity of reviews – building trust in the community, which is the cornerstone of their business. All funds are transferred securely online, with Airbnb taking 13% of the booking fee. The service is currently in 190 countries, 34,000 cities and has connected over 25,000,000 people. Just a few months ago, over 600,000 people traveled to Brazil for the 2014 World Cup, 20% of which stayed with a host on Airbnb. Like Uber, TaskRabbit, Sittercity, Rover, JustPark, Spinlister and many more, Airbnb gives people the ability to make money off their unused assets; otherwise known as the sharing economy. The company was founded in August 2008 by two good friends and classmates, Brian Chesky and Joe Gebbia, in San Francisco, California.
Why is Airbnb called Airbnb?
The concept of Airbnb derived from taking risks, challenging new experiences and not shying away from change. In October 2007, Chesky and Gebbia packed their bags and headed for a new life in San Francisco. Shortly after settling into their small loft, two common problems merged into a “aha moment.” First, just because the loft was small didn’t mean it wasn’t expensive. Both unemployed in a city with one of the highest standards of living, Brian and Joe needed money to survive. The second problem that emerged was when they realized that all nearby hotels were occupied for a major Industrial Design Conference. People needed a place to stay and they needed cash. The alignment became clear when they inflated three airbeds (air-mattresses) in the their living room. Cluttered, but crashable for a couple nights. They turned a traditional Bed & Breakfast into an AirBed & Breakfast.
The original site was launched on August 11, 2008 under the domain airbedandbreakfast.com, which focused on alternative lodging for popular events. Essentially trying to be accessible when demand was greater than supply. As the company continued to grow, listings on the site became more unique – boats, planes, teepees, igloos and tree-houses. They started offering free photography to incentivize people to list and to convert lookers into bookers. This improved the experience and added credibility, however many founders would have abandoned the idea because it’s hard to scale. Paul Graham told the founders of Airbnb to “do things that don’t scale and find a way to scale them.” This became an early mantra for the company and helped guide many strategic decisions. In March 2009, AirBed & Breakfast was shortened to Airbnb.
SEE ALSO: Why is it called Hipmunk?
Creativity Ignites Change
Building a marketplace to connect people takes extensive capital and time. Two things all founders want more of, but struggle to achieve. The more capital you can raise from angels, VC firms and even friends and family, the more time you’ll have to prove out the idea and gain momentum. Without the supply (places to stay), consumers don’t see the value. Without the demand (renters), your brand is always in the shadows, never top of mind. Both sides need to grow to be successful. The first step is raising money, not an easy task for even serial entrepreneurs.
Struggling to attract angel investors and venture capital firms, Chesky and Gebbia leveraged their creativity with a major market event to gain awareness and keep their dream alive. Focused on just keeping the site running, they created limited edition breakfast cereals with presidential candidates Barack Obama and John McCain called Obama O’s and Cap’n McCains. In less than 2 months, they sold 800 boxes at $40.00 each, which generated more than $30,000 of extra cash. Five percent of the profits were donated to the campaigns. Not exactly the most conventional way of raising raising capital, but it worked. Not only did this expand their runway, it caught the attention of Y Combinator’s Paul Graham. Surprised by their imagination and inspired by their determination, Chesky, Gebbia and Blecharczyk (new programmer) were invited to join the incubator’s winter session in January of 2009. After three months of mentoring and stabilizing their foundation, they used the $20,000 seed investment to engage with users (feedback and beers) and promote Airbnb in New York City.
On May 25, 2011, actor Ashton Kutcher announced a significant investment in the company. To date, Airbnb has raised north of 825 million dollars, has over 600 employees and is currently valued at more than 10 billion dollars.
Logo: Old vs New (Belo)
How a brand started will always stay the same, but what the brand stands for will change as it matures and evolves. One of the most powerful ways to promote a new identity is to change your old one – your logo. This visual change attracts curiosity – “Why did Airbnb change their logo?” or “What is Airbnb?” which gives brands the opportunity to tell a new story. If the story is compelling enough, people will talk about it, share it and with time and consistency, the perception of the brand will change. Airbnb embraced this opportunity. They redesigned their website to emotionally connect with new and existing users, they changed their logo, launched a new magazine for hosts and created their own identity symbol known as Belo: the universal symbol of belonging. With the belief that we are united by the universal, powerful, human desire to connect, to understand, and to belong. With audacious goals, Airbnb will continue to solve big problems, the ones most stress just thinking about. They disrupted travel by selling cereal, imagine the methods they’ll discover to make humans feel a strong sense of belonging.
Constructed to Perfection: Completely Man Made
Next time, use Airbnb to save a little cash, meet new people, learn new cultures and venture the city with locals. Thanks for reading why is it called Airbnb?! #whyisitcalledAirbnb