Focusing on growing a business may not be the best idea for entrepreneurs, according to Airbnb co-founder and CEO Brian Chesky.
In 2008, when Chesky is his Airbnb Cofounders Nathan Blecharczyk and Joe Gebbia wanted to get funding for the start-up, they approached more than a dozen Silicon Valley funds-all of which rejected their pitch.
One of the investors told Chesky about the Airbnb market, which later went with Airbed & Breakfast – “it didn’t seem big enough” for their core brand.
“You’d think they didn’t see tours, they saw strangers sleeping in other people’s houses,” Chesky said he told the audience at the Stanford Graduate School of Business. “The first investor Joe and I ever met was in a cafe, [he] he comes in, goes to get a smoothie, sits down, drinks the smoothie, we throw it at him. In the middle of the sermon he got up because he had to move his car. Until now we have not seen him.”
‘The best advice I’ve ever received’
Airbnb was finally accepted by venture capitalist Paul Graham, the founder of the accelerator Y Combinator, although Graham himself was skeptical.
“The first question Paul Graham asked me was, are people really doing this?” And I said yes, so the second question was good, what is their problem? Chesky told the crowd.
At the Y Combinator event, Chesky said Graham gave him the best advice he’s ever received.
“He said … focus on the 100 people who like you, instead of finding a million people like you,” Chesky revealed. “And I think that was great advice, and it might be the best advice I ever got.”
This does not mean that many people would consider doing this, according to an Airbnb executive.
“It goes against everything everyone says,” he added. “Everyone looks at scale, but growth requires people to have a deep sense of purpose [for your product].”
Chesky said that when you focus your offering on a few people, “they become your marketing department, they tell other people.” It’s a strategy that helped Airbnb grow rapidly in the decade it was founded.
“Maybe they can’t make eight, nine or ten stars, but a lot of people try to make something that’s good,” Chesky continued. “But if you can add a sixth or seventh star, if you can create something that’s really amazing and you use that part of your brain, the artificial part of your brain, to create that great experience, then you can revolutionize the engineering of how to do that. millions of times. And what happens is people love your product and tell everyone else about your product.”
Graham’s advice helped the Airbnb founding team grow their business into what it is today – a platform with more than 6.6 million listings worldwide that has helped 1.4 billion guests stay since its inception.
“Hilton it started in 1919, 100 years ago,” said Chesky. “And we were able to have all the growth of Hilton in 10 years. We had sales, but at first it wasn’t much. “