180772015, Echelon Malaysia: The Alrtnb story ORGANIZING AN EVENT? SHARE IT WITH ASIA'S TECH COMMUNITY ON £271 (HTTP://E27.CO/EVENTS) ‘BUSINESS (HTP-//E27.cO/CATEGORY/BUSINES) FEATURES HTP-//E27CO/CATEGORY/FEATURE) MALAYSIA (HTT.//E27.CO/CATEGORY/MALAYSIA) WORLD (WIT:/27,O/CATEGORY/WORLD) Echelon Malaysia: The Airbnb story From not being able to make rent to creating this mamoth startup in just four yeas, Thomas Wang of Airbmb shares the inspiring founding story By Michael de Waal Montgomery (tplle27colauthorimontymike) Follow @nikhston 57 bees osu, 204 % £ — SurvscmrveII) — in BATON ‘Thomas Wang, Team Lead for Singapore and Malaysia, Aironb speaking at Echelon Malaysia 2014 The passion and energy of founders at Echelon Malaysia 2014 reminded Thomas Wang (http:/e2T.coytag/thomas-wang), Team Lead for Singapore and Malaysia, Airbnb (http:/e27.co/tag/airbnb), of the early days of Aiton. ‘Wang joined us lst week atthe event to share the startups’s story. For anyone not familiar with Aisbnb’s model, itis a website (and app) that allows people to rent out lodging — perfect for home owners ‘who want to lista spare room inorder to bring ina litle extra income each month. Abn takes a small cut on each transaction completed over its platform, “Alebnb seeks tobe hospitality reimagined. No longer are the days when you think about hospitality and the first thing that comes to rind are big hotels, but rather Airbnb allows a community of travellers and hosts to come together and experience the world in a Aisferent way said Wang, Also Read: Fchelon Malaysia: 8Common’s Nic Lim shares blueprint for going global (http://e27.cofechelon-malaysia-Scommons- nic-lim-shares-blueprintfor-going,global-20141201/) ‘The Wall Sree Journal reported (http://blogs.ws)-com/digits/2014/05/20/ow-does-alrbnbs-10-billion-valuation-size-up/) earlier this year that Airbnb could be worth up to USS10 billion. But what is really striking is when you put that in context against the Value f established luxury hotel chains Inipile27 colecelon-malaysia-the-aronb-stry-201412051 18re072015 Echelon Malaysia: The Alrtnb story ‘Ata USS10 billion valuation, Airbnb would be valued at more than some ofthe hotel chains itis increasingly competing agninst, Wyndham, which manages 7,500 hotels under brands like Wyndham, Ramada and Days Inn, had USSS billion in revenue last year and is valued at USS9.4 Dillion. Hyatt Hotels, with more than USS4 billion in revenue, is worth USS8.4 billion, ‘With such incredible succes in such a short perio of time, many are naturally intrested in the startups story. Airbnb began, ike most other startups, by trying to solve a problem. The seeds oft were planted inthe San Francisco apartment of CCo-founders Brian Chesky and Joe Gebbia in 2007 They had both graduated from the Rhode Island School of Design as industrial designers before moving to California, One day around that time, Gebba celled up Chesky with the idea of starting a business together hugh exactly what that business would be they didnt yet know. Also Read: Echelon Malaysia: Disruption and collaboration go hand-in-hand — Bobby Bhatia (http://e27-cofechelon-malaysia- disruption collaboration-go-hand-hand-bobby-bhatia-20141204/) “Brian had to make the difficult decision of quitting is job, driving up to San Francisco and moving nto Joe's apartment... twas a fresh start for the two entrepreneurs. So what was ther problem? Well, the fong-term problem was that now that they were rm problem,” he said. unemployed entrepreneurs, they needed an idea to work on..But they had an even more immediate sho That immediate problem was that they couldn't afford the next month's rent because of San Francisco's sky-high ental costs, Fortunately for them, there just happened tobe at a big international design conference in the city the following weekend, They realised al the local hotel zooms were sold out. “The idea came to them, What if we could ten our home ifs’ bed and breakfast? Wang sald. Because they were short on furniture, they used air mattresses and went with the name Air Bed & Breakfast — the genesis of the name fr Airbnb. They put up a very basic WordPress website with details on their offering. ‘Within 24 hours they had received several requests for bookings, neluding from as ar away as India They ended up accepting three suests and making USS1,000, taking care of the next month's rent that they thought they wouldn't be able to meet. t the same time, they realised there might be something more to this as a long-term business model. [Nathan Blecharezyk, CTO, joined Chesky and Gebbia one year ater the launch ofthe original WordPress website to help engineer some ofthe product development. Eventually, to raise more money, they tapped on thet creative design side to make cereal boxes with characters of Barack Obama ‘and John McCain during the 2008 presidental election ‘campaigns, Over the course of two months, they managed to sell about 800 boxes at USS40 each, making over USSS0,000. Also Read: Echelon Malaysia 5 lessons from accidental ‘entrepreneur Chok Leang Ooi (http://e27.cojechelon- ‘malaysia-S-Lessons-from-accidental-entrepreneur-chok- eang,-00%-20141128/) “1ewas this scrappy entrepreneurial activity —at atime The Obama and McCain cereal boxes designed by Joe and Brian in 2008 when they didn’t have any funding and didn’t know if they ‘would be able to continue with Air Bed & Breakfast — chat drew the attention of the likes of Paul Graham, Head of Y Combinator,* Wang said. They were accepted into the Winter class of the 2009 ¥ Combinator programme. ‘They used the new funding ftom ¥ Combinator, along with the USS30,00 from the cereal boxes, to do some futher research in New York and meet early adopters. It eventually resulted in them tweaking the business model to focussing not just on events, but inst providing accommodation solutions for travellers and hosts whenever and wherever, Just four years later in 2014, Airbnb is the unimaginable startup unicorn that we se today, ¥ —F — Suavscmenvoro) — im wat \ternating Tumba) i=8:Bolow Arle Alternating Thumbrals) 3Btabools_utm_soure ECOMENDED FoR TOU (stent comicrana naan dhrdaprenabortohennorkancattante Inipile27 colecelon-malaysia-the-aronb-stry-201412051 26