The summary of the Airbnb story and how the unicorn was built, the invaluable lessons from the founders

“If you launch and no one notices, you can keep launching. We kept launching, and people kept writing about it. We thought we’d just keep launching until we got customers.” – Chesky
Two lessons Airbnb founders learned from Paul Graham early on:
  1. It’s better to have 100 users who love you than 1 million users who just like you.
  2. Go to your customers
Chesky and Gebbia went door to door in NYC to meet with customers. They collected feedback, understood the customer’s pain points, organized meetups. They helped customers take pictures of their home to post on Airbnb….
Blecharczyk stayed back in SF to code the website.
Y Combinator invested 20% in Airbnb for 5% stake. Y Combinator provided coaching, mentoring, opportunities to meet future VCs.
Sequoia invested $585,000 and Youniversity invested $30,000 for 25% stake, which valued the company at $2.4 million. 3 founders then paid themselves a salary of $60,000 per year.
Chesky: the biggest enemy of startup is your own confidence and your own resolve.
Product/market fit = make something that people want
3 founders visited Zappos and other companies that wanted to emulate. They found out that they must have a set of values to guide the organization and a strong mission.
They composed their core values before hiring a first employee.
Interview process was intense. The 3rd engineer had to do 2 phone screens, in-person interviews with engineers #1 and #2 before meeting with Blecharczyk. After that, he met with Chesky and Gebbia. Before a decision was made, he had to come back twice to do a series of one-on-one with every person in the office.
The total of interview time was 15 hours. Then, he was given a timed three-hour take-home coding challenge.
The company grew to 25 people in summer of 2010 working in the 3-bedroom apartment.
Airbnb would hold the fee for 24 hours after the guest stay before releasing it to the host in order to ensure that everything is as expected by the guest.
Airbnb was emphatic  about certain things from the start: users are never more than 3 clicks   away from a booking, user experience is frictionless and easy.
Chesky and Gebbia focused on the look, simplicity, and overall experience of the website.
Issues that Airbnb solved:
  1. Payment system to enable seamless experience of paying for rooms and releasing payment to hosts.
  2. 24/7 customer support
  3. Search: matching the guest and the host so that both the guest and the host would not just like but like so much that both would use the platform again and would tell their friends.
Airbnb faced customer complaints about guests damaging the host’s belongings. The founders were advised to be careful in responding. They kept quiet and let the complaints surface. Finally, Chesky decided that he must stop managing the outcome and manage the situation in accordance with the company’s values.
Airbnb issued an insurance policy for the host of $1 million.
Airbnb also uses the classic marketing technique: giving hosts different statuses as rewards for their good behaviors.
Review system: users can only review after they pay. Host and user won’t see each other’s review for 24 hours.
Hosts and users can’t see phone number and address until a host accepted the request and reservation has been booked.
Don’t wait for a problem. If you want to work with a city, you should get to know a city. If you go there first and you come with the best of intentions, you could end up with a partnership. If a city comes to you, you could have many many years of potential conflicts.
If people like what you build, everything is a solvable problem with the application of smart people, time, and money. What you can’t solve for is if you built something nobody wants.
There are always good mentors at anytime. When Chesky was unemployed, he was just as shameless.
Chesky is a learning machine with extreme level of curiosity. Chesky constantly takes notes.
Chesky writes down what he learned during the week and sends an email to his staff to share. It becomes his management tool.
How to get your staff to play at the next level: you can’t really ask them to work harder when they are already tired but you can ask them to massively up-level their thinking.
Chesky is driven by a calling rather than fame or money. Buffett: Chesky would be doing what he’s doing if he didn’t get paid a dime for it.
Reference:  The Airbnb Story: How Three Ordinary Guys Disrupted an Industry, Made Billions . . . and Created Plenty of Controversy by Leigh Gallagher

Enter your email to subscribe to notifications from this site

Join 4,662 other followers

Other popular articles:

  1. Making 6 figures? How to avoid being one of 69% of Americans who have less than $1000 in the bank.
  2. How to get your dream job with no experience – Lessons from Bill McDermott
  3. 20 minutes that can change your life
  4. A SPECIAL GIFT FOR YOU – WHY SHOULD I HIRE A COACH?
  5. Making 6 figures #2? How to avoid being one of 29% of American households with no retirement savings
  6. How to guard yourself against negative influences
  7. Life lessons from a Uber driver who was laid off
  8. This simple skill is worth millions, helped many become millionaires, billionaires
  9. Leaders are readers

About the author: Hoan Do is a certified leadership coach. Hoan have led multiple teams at Symantec Inc. across the globe delivering world-class solutions to protect consumers and businesses. Hoan is an expert in building highly performing teams. He believes that the best leader is the leader that could grow his followers to be leaders. Hoan has been organizing mastermind groups to share with other leaders about transformational leadership and coaching. He has trained many leaders via mastermind groups, workshops, and one-on-one coaching.

If you are curious about the above method and how you can apply it to your life successfully, open your email and send me an inquiry at coach@hoanmdo.com

10 traits of megasuccessful entrepreneurs

I wanted to look for a list of commonalities among CEOs and founders of unicorns, which are startups that surpass billion dollar valuation.

Ray Dalio, the billionaire founder of BridgeWater which manages $160 billion in 2017, wrote in his best-selling book “The Principle” about his research for commonalities among successful entrepreneurs whose companies and products disrupted the industry. Ray called them shapers. I have heard others called them builders, disruptors, or simply entrepreneurs.

The following is from Ray’s book “The Principle”.

Shaper is someone who comes up with unique and valuable visions and builds them, typically over doubts and opposition of others.
Steve Jobs, Bill Gates, Ray Dalio are shapers.
Ray researched shapers (Steve Jobs, Elon Musk, Bill Gates, Jeff Bezos….) and came up with their commonalities:
    1. They visualize remarkable concept and build organizations to actualize them.
    2. They are independent thinkers who do not let anyone or anything stand in their way of achieving their audacious goals.
    3. They have very strong mental maps of how things should be done, a willingness to test those mental maps, and change the ways they do things to make them work better.
    4. They are extremely resilient because their need to achieve what they envision is stronger than the pain they experience.
    5. They have a wider range of vision than most people.
    6. They are able to see big pictures and granular details and synthesize the perspectives they gain at those different levels.
    7. They are simultaneously creative, systematic, and practical.
    8. They are assertive and open-minded.
    9. They are passionate about what they are doing, intolerant of people who work for them who aren’t excellent at what they do.
    10. They want to have a big, beneficial impact on the world.
Shapers would rate low on the question “Concern for others”. The reason is that when faced with a choice between achieving their goal or pleasing others, they would choose achieving their goals every time.
True shapers consistently move from one success to another and sustain over decades.
Check out Ray’s amazing book at https://www.principles.com

Enter your email to subscribe to notifications from this site

Join 4,662 other followers

Other popular articles:

  1. Making 6 figures? How to avoid being one of 69% of Americans who have less than $1000 in the bank.
  2. How to get your dream job with no experience – Lessons from Bill McDermott
  3. 20 minutes that can change your life
  4. A SPECIAL GIFT FOR YOU – WHY SHOULD I HIRE A COACH?
  5. Making 6 figures #2? How to avoid being one of 29% of American households with no retirement savings
  6. How to guard yourself against negative influences
  7. Life lessons from a Uber driver who was laid off
  8. This simple skill is worth millions, helped many become millionaires, billionaires
  9. Leaders are readers

About the author: Hoan Do is a certified leadership coach. Hoan have led multiple teams at Symantec Inc. across the globe delivering world-class solutions to protect consumers and businesses. Hoan is an expert in building highly performing teams. He believes that the best leader is the leader that could grow his followers to be leaders. Hoan has been organizing mastermind groups to share with other leaders about transformational leadership and coaching. He has trained many leaders via mastermind groups, workshops, and one-on-one coaching.

If you are curious about the above method and how you can apply it to your life successfully, open your email and send me an inquiry at coach@hoanmdo.com

Startup story: Cindy Mi and the $3 billion tech startup

VIPKid is an online learning platform to match North American teachers  with Chinese students in China. Teachers are mainly sourced from America and Canada.

Cindy Mi saw the gap between the number of students in China wanting to learn English from native speakers and the number of native speakers in China. She started VIPKid in 2013. In 2017, VIPKid brought in $700 million in revenue, up from $300 million from 2016. With the latest round of funding at $500 million in April 2018, VIPKid is valued at $3 billion.

At the age of 17, Cindy dropped out of high school. She founded an English school with her uncle. Her parents encouragingly said to her: “Make the decision and don’t come back in tears.”

Before starting VIPKid, she built the English school into the $30-million-in-revenue business while earning her bachelor degree by self-teaching herself and getting an MBA.

VIPKid was started with a small team in China. In the first year, it had over 20 people. By end of 2017, VIPKid employed over 3000 people, mostly in Beijing. VIPKid attracted teachers by creating community and referrals. VIPKid sends weekly newsletters to teachers to tell them what’s happening and give them a sense of connected community.

References:

https://www.fastcompany.com/40525523/how-vipkid-ceo-cindy-mi-made-education-a-universal-language

https://www.businessinsider.com/inside-vipkid-cindy-mi-and-3-billion-startups-teacher-community-2018-8#the-mission-and-the-acolytes-5

https://www.crunchbase.com/organization/vipkid#section-funding-rounds

https://moneyinc.com/10-things-didnt-know-cindy-mi/

https://www.ft.com/content/2d471578-f7d1-11e7-a4c9-bbdefa4f210b

 

Enter your email to subscribe to notifications from this site

Join 4,662 other followers

Other popular articles:

  1. Making 6 figures? How to avoid being one of 69% of Americans who have less than $1000 in the bank.
  2. How to get your dream job with no experience – Lessons from Bill McDermott
  3. 20 minutes that can change your life
  4. A SPECIAL GIFT FOR YOU – WHY SHOULD I HIRE A COACH?
  5. Making 6 figures #2? How to avoid being one of 29% of American households with no retirement savings
  6. How to guard yourself against negative influences
  7. Life lessons from a Uber driver who was laid off
  8. This simple skill is worth millions, helped many become millionaires, billionaires
  9. Leaders are readers

About the author: Hoan Do is a certified leadership coach. Hoan have led multiple teams at Symantec Inc. across the globe delivering world-class solutions to protect consumers and businesses. Hoan is an expert in building highly performing teams. He believes that the best leader is the leader that could grow his followers to be leaders. Hoan has been organizing mastermind groups to share with other leaders about transformational leadership and coaching. He has trained many leaders via mastermind groups, workshops, and one-on-one coaching.

If you are curious about the above method and how you can apply it to your life successfully, open your email and send me an inquiry at coach@hoanmdo.com

Warren Buffett – Timeless and Fool-Proof Advice for Entrepreneurs

Warren Buffett – Advice for Entrepreneurs: simple rules like that delighting customers, working through other people, associating with people better than you are will cause you to move in a better path.

Warren Buffett – Advice for Entrepreneurs: simple rules like that delighting customers, working through other people, associating with people better than you are will cause you to move in a better path.

 

[Edited transcript by Hoan Do]

I would like to just tell you a couple of short stories and we’ll draw maybe a couple of lessons from them.  I would like to tell you of two women that each sold the business to Berkshire Hathaway for many many many millions of dollars. Both of them started with twenty-five hundred dollars by a coincidence was the exact same amount. It was everything they had in the world.

One of them was a woman who landed in Seattle in 1917. She couldn’t speak a word of English. The Red Cross got her to Ford dodge where she was reunited with her husband who had come to the country a couple of years earlier. She lived in Fort Dodge for two years. As she put it, she felt like a dummy. She couldn’t pick up the language. She couldn’t learn a word.

So she and her husband decided to move to Omaha in 1919. There she found a small colony of Russian Jews. She started feeling more at home. As her oldest daughter went to school, she would come home and teach her mother the words she learned in school that day.

This woman, Rose Blumpkin, spent 20 years saving money bringing first her siblings over, her mother and father fifty dollars at a time. She sold used clothing to do it.

She had four children during this period. By 1937, after 20 years, she saved $2,500. She went to Chicago and she bought what she could have furnished her dream, which had always been to open a furniture store. This woman would never gone to school one day in her life. With $2,500 but with the same spirit that the people in this room had about having a dream and working to accomplish that dream,  she built a business which she sold to me in 1983 for 60 million dollars approximately. The fourth generation is working in that business. This woman Rose Blumpkin lived well. She worked for me until she was 103. Then she retired and she died the next year. Mrs. B with her $2,500, could not read or write, and she went into a furniture business, and she didn’t bring anything in unique in furniture but she brought a determination to succeed. She knew she could outwork anyone else. She knew she cared about her customers. She worked at very low gross margins. She built this incredible business.

I saw one other woman who did a similar thing with $2,500. I paid her hundreds of millions for her business.

Today I’d like to tell you about one other small business person. I went to buy his business from him and he turned me down, which was very wise. This was a fellow who was born about eight years before I was he was born in 1922. He was a pretty good athlete, didn’t like school much. His company hires more college graduates each year than any other company in the United States. He went to college for a year and then dropped out. He really wasn’t that interested in the school and the year he dropped out was 1941. When the United States was under attack, he went down to the Army Air Force recruiting station to volunteer. They turned him down because he had hay fever. He went over to the Navy and again volunteered and they took him. They put him on an aircraft carrier. He flew small fighter planes during World War II. Then he came back to the Midwest.

By this time, he would be 23 or 24 years old. He actually kind of went from one job to another for a short period of time. He finally became a used car salesman at a Cadillac dealership in st. Louis Missouri. At age 35 having moved up in the sales organization, he said to his boss: “could I go into car leasing business with you,” The boss said: “well if you’ll cut your salary in half and you’ll come up with $25,000 ( which he borrowed), we can become partners in a car leasing company.” 

My friend Jack started at age 35 at the car leasing business. He had seven cars. It was pretty slow.  In fact one of the things he did was whenever the phone rang, he let it ring three or four times so people would think that he was very busy answering other phones. And of course it was the only call he was gonna get all day. So his first venture was okay but it wasn’t really going to go anyplace. And there’s a lesson in this for all of us. At age 40 he decided with 17 vehicles, he was going to go into competition in the rent-a-car business. So now he’s taking on Hertz and Avis and national and people like that who have hundreds and hundreds of thousands of cars and he’s got 17 cars. And his cars aren’t any different from theirs. He’s buying them from General Motors or Ford or Chrysler and he can’t get the airport locations which those companies have. But he was determined that he would basically offer the customer the friendlier service than they’ve ever seen. And so he started the company and named it after the battleship that he’d flown from in the Pacific, which was the USS Enterprise. When he died about the year and a half ago, his rent-a-car company starting with those seventeen cars was worth more than Hertz and Avis and all the rest of the rental cars put together. The man’s name was Jack Taylor. His son Andy Taylor, the friend of mine, runs the business now.

So this man didn’t invent artificial intelligence. He didn’t do anything that just like Mrs. B selling furniture. Any one of us could have entered those businesses. He lived by the creed basically of delighting his customers and working with people and establishing the relationship with them so that they in turn would want to delight the customers. He learned how to project himself and his attitude toward his fellow man. He desired to make a friend out of every customer. He managed to take very ordinary cars and turn them into this extraordinary business from virtually nothing.

It illustrates several points. You don’t necessarily get it right the first time. In the car leasing business, basically we’re competing on the cost of money to finance cars and it’s very hard to delight a customer. At the age of 40 with all of that experience behind him, he found the golden key. He took a very ordinary business and turned it into an absolutely extraordinary operation just like Mrs. B did with furniture. He didn’t worry about whether the Federal Reserve was going to tighten or ease. He didn’t worry about whether the stock market was up or down yesterday. He didn’t worry about the things he couldn’t change. He did focus on the one thing he could change. That was the customers experience.

He was smart enough to see that he would find that business. Henry Ford as you may know failed twice before he started the Ford Motor Company in 1903. The the test isn’t whether you get the greatest business idea in the world the first time out. The test is whether you keep learning as you go along.What your strengths are and what you can do for your customers. What you can bring especially to the party. To do that you need a genuine desire day-in day-out to delight the customer. I’ve never seen a business that delight the customer and doesn’t succeed. What you want is that customer the next day when they want to rent a car or buy some furniture, what goes through their mind is that it’s the place where they’ve had a great experience. I don’t know the tie and the shirts I am wearing now but  I do know I will remember how I was treated what I bought it. 

You long forget about the price but you never forget whether you had a good experience or a poor experience with the purchase experience.If the memory is of rudeness, indifference, they’re never going to come back. 

As a small business owner and as you grow, you have to not only be able to project that interest in people’s well-being in delighting them yourself, but you have to do it through other people. And you won’t be able to do it through people who themselves do not feel they’re being fairly treated and that their views aren’t appropriately considered. So you really do have to learn to multiply yourself through other people. 

I advise the young people to come to Omaha that the most important decision you make is the spouse that most of you will likely have and it’s very important to surround your people yourself with people are the better than you are. You are going to move in the direction of the people you associate with. I advise you to seek out your partner in business, your partner life who actually are examples to you rather than somebody that you need to straighten out yourself. And simple rules like that delighting customers, working through other people, associating with people better than you are will cause you to move in a better path.

Enter your email to subscribe to notifications from this site

Join 4,662 other followers

 

About the author: Hoan Do is a certified leadership coach with John Maxwell Team. Hoan have led multiple teams at Symantec Inc. across the globe delivering world-class solutions to protect consumers and businesses. Hoan is an expert in building highly performing teams. He believes that the best leader is the leader that could grow his followers to be leaders. Hoan has been organizing mastermind groups at work to share with other leaders about transformational leadership and coaching. He has trained many leaders both inside and outside Symantec via mastermind groups, workshops, and one-on-one coaching.
Coaching inquiry: coach@hoanmdo.com