How Airbnb went from renting out air mattresses to a $75bn global giant
The clever strategies used to fuel massive early stage growth
Many know Airbnb’s starting point, but most are unaware of the highly creative growth strategies by founders Brian Chesky and Joe Gebbia that are responsible for massive early stage growth, helping the platform become what it is today.
Heres a review of their basic timeline:
Growth strategy #1: Cereal Box (early growth)
In 2008 they raised $30k by creating/selling these election cereal boxes with the Airbnb logo on it for $40! Despite not gaining much traction, this caught the eye of Paul Graham (YC founder) and led to them joining YC in 2009
Growth strategy #2: Photography program
The founders noticed users were presenting their listing with particularly bad photos. So they rented a $5000 camera, flew out to New York and took as many photos of their listings as possible. This led to 3x bookings and 2x revenue
This flywheel was repeated in other cities with consistent results. Next Airbnb officially launched the photography program (2010). Hosts could schedule a pro photographer to take photos of their listing.Listings were now 2.5x more likely to be booked
Growth lever: Activation
Growth strategy #3: Craigslist integration (2010)
Lacking traction, they recognized Craigslist as a platform where their target market existed (people looking for accommodations different from the standard hotel experience) They had one thing Airbnb didn't - a MASSIVE user base
Incomes the true growth hack -> Craigslist posting bot Because Craigslists saves listing information using a unique URL (rather than a cookie), Airbnb built a bot to visit craigslist, create a unique URL, input the listing info and forward the URL to the user to be published.
Not only was it the sheer volume of users, Airbnb’s listentings were far superior due to better descriptions and professional photos. Once Craigslist users made the switch, they were more likely to book straight through Airbnb in the future
Growth lever: Acquisition
Growth strategy #4: Craigslist Poaching
After the first integration got much needed traffic, they set up automated emails to be sent to the host every time a rental property was posted on Craigslist from an “excited Airbnb User” who advised them to check out the Airbnb site.
This email spam hack helped grow their listings quickly at almost no cost. By the time Craigslist caught on, they had generated massive traffic and brand awareness, leading to a large influx of new postings straight on the Airbnb site.
Growth Lever: Acquisition
Today:
- Over 2 million people stay in an airbnb every night
- 220 counties and regions with active listings
- 7 million listings on Airbnb worldwide
Keys to growth success:
- Creativity of founders
- Knowledge of viral marketing
- Willingness to use bold growth hacks
End Notes
I hope you enjoyed this post! Stay tuned as I will be dissecting a new company's early growth tactics every friday!
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