Originally uploaded by charmaine_cooper.

When you walk into our conference room at Union Square Ventures, you see the box of cereal on the right on our conference room credenza next to a wifi router and a jar of Jolly Ranchers. It is there because we are big Obama fans? Nope. The cereal box is a reminder to back great entrepreneurs whenever they walk into our office regardless of what they pitch us on (as long as its in our investment universe).

Let me explain. Cliff Elam made a suggestion for a blog post in the "bloggers block" comment thread. He said:

Tell us about something you saw that was intensely interesting but was not something you'd invest in. And why.

So here's the story of how we missed Airbnb, one of the best startups to come our way in the past few years.

The Airbnb founders came out of the winter 2009 Y Combinator class. They came to see us during their time at YC. They told us about a great stunt they pulled at the Democratic Convention in Denver (in which Obama was nominated). They bought a bulk supply of generic cheerios and made up these cereal boxes to generate seed capital for their startup. Here's how one of the founders Joe Gebbia describes it:

We made 500 of each (Obama O's and Cap'n McCains). They were a numbered edition on the top of each box, and sold for $40 each. The Obama O's sold out, netting the funds we needed to keep Airbnb alive. The Cap'n McCains… they didn't sell quite as well, and we ended up eating them to save money on food.

I asked them if they'd leave a box of the cereal for us and it has been sitting in our conference room ever since. Whenever someone tells me that they can't figure out how to raise the first $25,000 they need to get their company started I stand up, walk over to the cereal box, and tell this story. It is a story of pure unadulterated hustle. And I love it.

At that time, Airbnb was a marketplace for air mattresses on the floors of people's apartments. Thus the name. They had ideas for taking on other listings but they had not yet made much progress on them.

We couldn't wrap our heads around air mattresses on the living room floors as the next hotel room and did not chase the deal. Others saw the amazing team that we saw, funded them, and the rest is history. Airbnb is well on its way to building the "eBay of spaces." I'm pretty sure it will be a billion dollar business in time.

We made the classic mistake that all investors make. We focused too much on what they were doing at the time and not enough on what they could do, would do, and did do. I am proud that our portfolio is full of companies where we saw the vision before other investors did and backed a great team. But we don't always get it right. We missed Airbnb even though we loved the team. Big mistake. The cereal box will remain in our conference room as a warning not to make that mistake again.


Comments (Archived):

  1. Jan Schultink

    OK, I am posting the (not very useful) “great post” comment.

    1. Dave Pinsen

      In the future, you can just click the “like” button below the post.

      1. Jan Schultink

        Fair enough

        1. Matt A. Myers

          Not only am I “Liking” ALL of these comments but I’m telling you about it too! πŸ˜›

      2. fredwilson

        i prefer to see the comment to be honest. thanks Jan!

    2. giffc

      I second Jan. Really enjoyed the post.

  2. Jarvis Jones

    Maybe you should take a closer look at the newly launched AirBnB competitor from Europe then:

    1. Eli James

      You mean the newly launched AirBnB copycat? πŸ˜‰

    2. fredwilson

      i’m not a fan of copycats

      1. Dave W Baldwin

        Chris Yeh wrote a good one regarding too many “me too’s” out there. In his opinion, the bigger danger.

        1. fredwilson

          we want to invest in the category creator. that’s what we’ve done and that’swhat we want to do going forward

          1. Dave Pinsen

            Did you see this tweet from Chris Dixon yesterday?:no company that benefitted from a new business model invented it themselves (google/overture, facebook/Zynga etc).

          2. fredwilson

            I think that is wrong. I will write a blog post about it

          3. andyswan


          4. Dave W Baldwin

            It comes down to boxes once again. You have Category and SubCategory.Successful Categories are due to evolving into many SubCategories.

          5. Dave Pinsen

            I disagree as well. The counter-example I mentioned in response to Chris was Ford (the assembly line) — which, incidentally, reminds me of this post I wrote last year, Web 2.0 versus Auto 2.0.

          6. falicon

            I can’t reply to Andy directly (guess thread goes too deep?)…but LOVE that he works in shamwow!and as a nod, here’s a yotube video to a great shamwow jam ->

          7. Jeff Sepp

            Execution is most important – not being first

          8. Dave W Baldwin

            I like the term Category Creator.

          9. William Mougayar

            I’m slightly confused then. Do you consider Kik and Foursquare category creators? Or did they come later with a great team, organic passion, and excellent execution?

          10. Tyler Willis

            FWIW w/r/t Foursquare, I think they definitely earn the title of category creators. They were defintely the first to get mass adoption in local check-ins, they were the first to really get game mechanics really right, and dennis had created probably one of the earliest companies in the space with dodgeball.

          11. William Mougayar

            @ Tyler Willis. (wha’t happening with Reply’s disappearing on Disqus?)Category creators and (current) category owners are not the same thing. It’s amazing the effect that good marketing and execution has on human memory.

          12. ipostelnik

            How’s AirBnB a Category Creator? You’ve seen HomeAway, right? And the 100 other sites that HomeAway rolled up. It’s the same exact business.

          13. Cost2Drive

            It’s really very different, in fact I read somewhere that the CEO of Homeaway is very intrigued by the AirBNB model.

          14. kenberger

            Definitely need a follow-up post entitled “The Category Creator”.re “that’s what we’ve done”, people are screaming “what about mytown before foursquare??”, etc etc.maybe there’s distinctions to be made between category originator, category tipper, category enabler, etc.

      2. marco

        to be very provocative one could say airbnb is a copycat of couchsurfing, or is just commercializing an idea different enough?

        1. Jocelyn

          There are hundreds of marketplace businesses that can and will be launched off the back of what Craigslist doesn’t provide.AirBNB is one of them, and Craigslist was huge (and remains huge) for distribution for both it and many other vacation rental marketplace players, including the big guys like VRBO, Flipkey, etc. Essential to AirBNB’s early distribution was a very clean and beautiful “Post To Craigslist” function, as well as actively reaching out to Craigslist users to get them to list on AirBNB.I am in this space as well, and I see another copycat to AirBnB launched every week. Indeed, I’m sure there were AirBNB “copycats” launching before AirBNB was a twinkle in Brian and Joe’s eyes. As much as maybe the “old guys” at USV didn’t see its value, a place for enterprising individuals to run mini hotel operations served a real and long-standing need, and taps into the growing trend for collaborative consumption.The feat the AirBNB guys accomplished here and the others didn’t was getting the critical mass and momentum necessary to build a functioning marketplace, especially within this fragmented industry. All of the copycat sites are will sputter and die off without a critical mass of user-generated inventory.

  3. Pascal-Emmanuel Gobry

    It’s also a reminder to invest in people, not ideas.Great story. And kudos on the humility of owning up to that miss.

  4. Judah

    Thanks for the great reminder to always look at the big picture and see the potential in people. =)

  5. aanwar

    I agree with you that the team is awesome. I think Paul Graham backed them because he felt that the team was like cockroaches, they never die. I think he too didn’t see the value of it right away. I think Brian Chesky mentions this In his startup school talk.

  6. RichardF

    Great story, love the hustle, such an important part of being an entrepreneur.Maybe an opportunity in a later round Fred with the new fund?

    1. fredwilson

      that’s not really what the new fund is for, but anything is possible

    1. fredwilson

      is it a Q&A site or a place to fund tutors, counselors, etc to come work with you?


        It is just like Airbnb, individual could post their expertise instead of houses and apartments, such as language ability and we help them to do the marketing.We also deal with the hassles that someone might be facing if they are trying to market online by themselves, such as booking, messaging, scheduling, payment receiving (processing fee will be charged, just like Airbnb). The system is not limited to online service, experts could use it for offline business, but there is an online session room built in so it could be simple if they are trying to conduct an online video conferencing based session.

        1. fredwilson

          like teachstreet?


            In some sense it is just like a million websites out there providing online teaching service.But we are trying not to limit ourselves into teaching or tutoring business (although it is big enough be be a viable business)Our vision is that everyone has perhaps a kind of expertise, so we help them to promote it online.Say if I were a nuclear physician, CNN could use to book an interview with me about the crisis in Japan, so we don’t need to see this guy on TV :-)P.S. I do like this guy on CNN.

          2. fredwilson

            Send me an email at fred at usv dot com and we’ll continue the convo

          3. markslater

            you are right in freds wheelhouse – send him an email!

          4. RichardF

            nice pitch ….well played

        2. FAKE GRIMLOCK


    2. Nik Cubrilovic

      You are onto something. I have seen a few entrants into this space, but nobody who has really nailed it. The taxonomy is more complicated than renting out accommodation, nothing that can’t be solved – somebody in this space is definitely going to do well.Can I suggest that you focus narrowly first, for eg. music lessons or high school tutoring in a specific geographic area. The sites that I have seen in this space attempted to be everything to everybody too early which resulted in large sections of the site being empty. A decent implementation (I am not sure how they are doing atm) is Betterfly:…can I ask how you are handling payments? accepting money from one group of people, taking a cut and then distributing the rest to another group of people is a PITA to get started (to add, AirBnB started with an outsourced/API solution then figured out quickly what everybody else finds out, and that is that they all suck and you need to build your own)


        Exactly, focusing on one field is what we are trying to do now. At this moment, it is language tutoring expert that we are building. Simply because there are millions of language tutoring websites out there and people like to use Skype to teach online language classes. So it is not that hard to persuade them to move.Unfortunately, we are using Paypal to handle the money transaction which is quite dangerous in some ways. But before we get a merchant account from somewhere, it is a good way to do it as it also has good API and we have pretty much automated the process now.

        1. FAKE GRIMLOCK




      3. terrycojones

        G’day Nik :-)Does that include Amazon FPS?

        1. Nik Cubrilovic

          Hey Terry, no experience with it yet – but I am going to jump in with both FPS and Gcheckout next week since I need to implement my own solution for an upcoming product. you looking for something as well? I just know that I will never go back to paypaloh and co-incidentally I somehow stumbled on the RWW ‘finally funded’ blog post about you last week, which was from a year ago – great story, congrats on the funding and getting it all worked out

          1. terrycojones

            Not looking yet. I just remember reading the Amazon FPS API docs and thinking it looked really good – including arranging for various types of payments between 3rd parties and taking a cut (part of what we’re planning).Glad you found that post πŸ™‚ Much more recently, we won a Top Technology company prize at LAUNCH and last week Tim O’Reilly declared Fluidinfo was his favorite startup πŸ™‚ (Hi Fred!)

          2. Nik Cubrilovic

            I haven’t even read the FPS docs yet – but going through the TOC it is looking promising. I have had a half-dozen or so conversations recently with startups building marketplaces who are seeking out a payment solution. apparently the banks have tightened up who they give raw access to payment gateways to – they want to see months of revenue, plus assurity in escrow, before they would consider something.this might have something to do with money laundering regulations – i’m not sure. i’ll email you some info from the other conversations I am having. How soon are you looking to implement something?I wonder if it is possible for somebody to solve this problem and provide it as a solution to others, esp for those who are just starting out and will likely have low volume and no trading history.congrats on the LAUNCH launch and the prize – that is awesome. you still doing everything in python?

          3. terrycojones

            Hi NikThe thread got too wide to show a Reply link, so I’m top posting πŸ™‚ We’re not looking for anything soon (re payment solution). Yes, still all Python.

    3. Tereza

      What’s your cut?


        10% for every booking just like Airbnb does?So if we could get 1000 bookings a day, and each booking cost 100 dollars, then we could make 10000 dollars a day!Wait a minute, we can’t do that. We are not Airbnb and we are not selling property…Well, we have our own model which I tend to tell you in person if you would like to discuss it further.



  7. JimHirshfield

    Lesson #2 – Don’t take breakfast meeting _at_ USV, I hear the cereal is stale. Then again, don’t go for the meal, go for the advice and funding. πŸ˜‰

    1. fredwilson

      the box has never been opened

  8. David Tran

    They were actually even more creative than selling $4×8,000 boxes of cereal! According to Brian Chesky’s Startup School talk (, he was $20k in credit card debt at the time and could only get 1000 boxes printed, so they sold 500 limited edition boxes of Obama O’s for $40/each to make 20k. Cap’n McCains unfortunately didn’t sell so well.

    1. fredwilson

      ah, i got the math wrong. well in any case, it is still a great story about hustle

  9. William Mougayar

    It’s a great metaphorical story. I love the AirBnB iPhone app which I’ve had since it came out. They have nailed the simplicity and elegance of what a mobile consumer app should be.But this space strikes me as bound to be fragmented, competitive, and with high marketing and branding costs to sustain growth. It’s about linear transaction/acquisition cost & selling a commodity (places) at the end. It reminds me of an end-game similar to having, travelocity, expedia, priceline, hotwire, oyster, etc. all vying for the same piece of a (large market). Then the aggregators like Kayak and others will come on top and take another cut from your cut. So, I’m not sure it’s an eBay type of market grab, rather a fragmented one where a few top players are all successful.

  10. LIAD

    I had the exact opposite situation.Was at a loose end in late 2008, came across AirBNB immediately saw the potential. Pulled the team off a client project, quelled my feelings of remorse about imitating and not innovating, and spent 3 months putting together a European Version. (Complete clone of the idea but not the mechanics/design etc).Found a great domain name ( and launched.Heart was never in the project. Went after it because I saw the potential not because I had love for the idea or any desire to run the business.Couple of weeks after launch, received a large offer for the domain name. Sold it without thinking twice. (Curiously, 2 years later, it still remains dormant as a link farm)Morale of the story – for entrepreneurs at least, not all that glitters is gold and you need to care a lot more about what your building and why you’re building it than the riches it may bring you.If you’re not passionate about the problem, you won’t be passionate about providing the solution.

    1. dissertation writing

      hi) agree with you in everything and your situation is so close to mine that it even scares!and […] If you’re not passionate about the problem, you won’t be passionate about providing the solution. […] you are 100% right!!!!

    2. feddkraft

      this is a great comment. it shows that the passion of makers about the idea is as important as the customer adoption.some theories teach us to find real problems and solve them, thus becoming an entrepreneur. seems that even if you make a demanded solution, if you don’t love the idea it could fail on, may we assume that a wannabe entrepreneur should just try hard to do what he invented himself, loves and believes that in would find customers, rather than first find a real and clearly seen problem and mechanically try to slove it?..from the investors’ point of view i’d prefer the first – though only if i am convinced that there is (accidentally) a real problem being solved.

      1. falicon

        This is def. a hard thing to figure out (and probably why so many successful people first failed miserably a few times before succeeding).I can say that, even if you love an idea, turning it into a business will not always be fun (and will go a long way in sapping the fun you orig. found out of it)…so as this starts to happen, if you were on the fence to begin with, it’s going to be super painful to put in the extra effort, the extra hours, and push through the dip (tip to Seth Godin there).To give you a personal example…I’m a huge NFL fan (Atlanta Falcons specifically) and like playing fantasy football…and so in the mid 90s I built ran a small fantasy football site (mostly just for my own league/friends)…the biggest pain point I had in running that site was in dealing with statistics…and as I poked around the industry I learned that it was a problem everyone was having (and honestly it’s still a big pain point for the industry)…anyway, long story short, I ended up building (a b2b web service providing stats primarily to fantasy sports companies).On a small scale, it was a pretty good success, and I was quickly making a high five figure income just doing this little project on the side (mostly just weekends during the NFL season)…and from a distance it looked like I was living the dream (getting to do tech. in a sports related company and even making a little cash)…and to some extent I was…but at the same time, I was working every time there was a game on…NFL games were no longer a time for relaxing or enjoying the games anymore (ie. I killed my main hobby)…and often they were actually the largest times of stress in my life (because that’s when any problems that arose were the most crucial to fix).Without my passion for the industry, I never would have shifted from trying to build league management stuff into a stats web service…and I wouldn’t have put in all the hours and energy it took to build up a small and loyal customer base for that service…and I wouldn’t have worked so hard to make sure the service was as perfect as it could be at all times…and probably more important, I wouldn’t have taken the time to step back and think about if it’s really working (it was but it wasn’t going to be easy to scale much beyond where I had taken it), if it’s really making me happy (money aside, it really wasn’t), and if I wanted to keep doing it (tech. it’s still live, but I just run it for my own needs now and sent all my customers to other services as I shifted my focus to things I thought I could have better/larger success with).Anyway – my point is, even with passion the chips are stacked against you…you have to find an edge that is going to push you through the times where you aren’t having any fun, where you don’t want to put in the extra hours, where you aren’t making the money you thought you would…and passion for the problem usually helps with that….but isn’t a solution in itself.p.s. sorry for the long rambling comment today! πŸ˜‰

        1. feddkraft

          thanks, this is also a great story.hope i don’t go offtopic, i’d just like to add that in the stats site situation you were passionate about football, which ceartainly differs from, say, debugging a stats mathematics all computed online with the technologies of the 90’s :)my story which i am thinking of is when a guy (really, me) is loving to do a thing which itself is a product. this is a situation of a software maker (as opposite to a themed web app, where the topic is one thing, and the programming is another).(i’ll confess further, what i am trying to do is to collect arguments for investors when they’d ask me why i think i’d succeed… and your story is also useful for me πŸ™‚

          1. falicon

            Cool…I would say that your passion is not a reason you will succeed…it’s really just a reason you’ll keep at it longer and try harder.In looking for the proper story about why you’ll succeed…I think the thing you have to focus on is why you have special insight into a problem…and how you are going to use that insight and position to fix the problem.Everyone knows the publishing industry is struggling…and there are a ton of people passionate about the industry…but only a few actually have the insight and are in a real position to be able to actually fix the problem…

          2. feddkraft

            software is not in vogue today πŸ™‚ took note btw

    3. Oo Nwoye - @OoTheNigerian

      The exact reason I tell people “someone cannot steal your idea”. For you to execute through thick and thin, your heart must be in it. Nice story.

      1. Matt A. Myers

        This has quelled my fears a lot. I realize that there’s no way anyone has the insights I do, especially since I’ve been developing and watching the internet since 11 years old. They just can’t have my confidence in where I’m looking to innovate.And even if there’s 1 other person, that’ll just make it fun – plus people will copy, but copies if they don’t have the heart underneath can’t be as good.Plus working towards owning 10% of a market worth “$20 billion” makes me happy.

    4. Mark Essel

      Thanks LIAD, great counter story and am glad it worked out well for you.

      1. LIAD

        Thanks Mark,It didn’t really work out well financially – the domain sale went to pay off the dev costs (3 people * 3months). But I learnt a lot from the whole experience, specifically qualifying opportunities vis-a-vis core values, skill-sets and passion before jumping into them

        1. falicon

          3 months of time and energy is totally worth the lesson you learned there!

        2. JLM

          Getting your bait back is not the same thing as losing your worm. It is a good outcome.

    5. Nick Grossman

      I have my own AirBnB story of woe:In early 2008, some friends of mine and I started building something very much like present-day AirBnB. We were inspired by friends who were renting their NYC apartments on craigslist during weekends when they were away, and making fabulous money doing it. The problem was, they were working really hard to find & vet renters, and dealing with annoying transactional issues.Our idea was to use ebay-style trust ratings, the social graph, and online payments to solve the dual issues of trust and transactional convenience. So much unused housing stock in NYC (and other cities, of course), such high hotel prices. An emerging model developing via Craigslist. So simple!In the beginning, we saw the big potential competition as vacation rental sites like (a mini-conglomerate in the space). However, those sites were all about dedicated income properties, not excess capacity in people’s primary residences.We had been building our thing (called Homefry) nights and weekends, for a few months, when we learned about Air Bed & Breakfast. At the time, they were focused on spare beds (or air beds) in apartments, a la We still thought that we had a solid niche renting out whole apartments during off-time, though it was clear that AirBed had the social and trust thing figured out.One really smart thing that AirBnB did was launch a promotion around the 2009 presidential inauguration. Called “Crash the Inauguration”, it helped people find places to stay in DC at a time when hotel rooms were either ridiculously expensive or simply not available.I don’t remember exactly when AirBed&Breakfast became AirBnB, and when they switched to focusing on apartment spaces as opposed to couches and beds. But somewhere along the way, we got the feeling that they were on a roll.We ended up stopping work on the project, sadly, before we launched anything. In retrospect, we just didn’t put in a solid enough effort, and not everyone working on our project was as into it as we probably needed. We were three guys, working on the project (way too slowly) in our spare time; they were three guys living together and crushing it.Watching AirBnB take off has been amazing for me — as a validation of an idea I was really passionate about for a while, and as a major point of frustration and disappointment, for obvious reasons.Last summer, I ran into Paul Graham at a conference and told him this story. He said two things: first, that the AirBnB team is one of the hardest working teams he’s ever seen. And second, he asked if we had ever launched our product.The truth is, even if we had launched, and even if we had launched much earlier (say, spring 2008), we would have had a hard time not being blown away by AirBnB – they have been on point since the beginning, and have executed nearly flawlessly in my opinion.So, I guess I have a few takeaways that I think are valuable: * I think I now know what it feels like to have an idea that I’m really fully behind. Next time that happens, I’m going to approach it much more aggressively. * If you feel that way, but everyone is not all the way on board, it’s not going to work. So recognize that early on and fix it, one way or another. * Craigslist, and other generative platforms, are great places to watch for trends, and for opportunities to apply structure to an emerging set of activities. * Ideas are a multiplier of execution, obv.

      1. David Semeria

        This is one my favourite ever comments on AVC.Your frankness, lack of sour grapes, and willingness to learn from your experience set you apart.Chapeau!

        1. JLM


          1. Alan

            True “cereal entrepreneurs”.

        2. Nick Grossman

          Thanks David!

      2. Brian Armstrong

        Yep, great point about watching trends on Craigslist to apply a better structure in one niche. That describes a number of successful startups.

      3. Mathieu Perreault

        “In retrospect, we just didn’t put in a solid enough effort, and not everyone working on our project was as into it as we probably needed.”This summarizes what I believe to be the most important factors in building a product: the right amount of motivated and hard-working people willing to put the majority of their time on the project (i.e. way more than a few hours a week).Like you mention in your takeaways, if you believe your idea has potential, you should stop everything and pursue it aggressively. Otherwise, it’s not even worth it to spend 10 hours a week developing it.

        1. Nick Grossman

          Yeah, in our case, we didn’t dive all the way in and run the way we would have needed to. Kind of hard to start something with varying amounts of several people’s free time. Probably not impossible, but definitely hard.However, since I felt strongly about it, it was my job to get everyone fully psyched and moving.What’s funny is that if there had not been an AirBnB, it would have been fine (not ideal, but workable) for us to keep moving slowly. But perhaps the lesson is that there’s probably always someone, somewhere, who’s thinking roughly the same thing you are, and you have to imagine that they’re pursuing it (or should be) at full speed.

          1. placement papers

            Well said @ NickBut perhaps the lesson is that there’s probably always someone, somewhere, who’s thinking roughly the same thing you are, and you have to imagine that they’re pursuing it (or should be) at full speed.

      4. Greg Gentschev

        The one thing I’d add (in relation to your even if we had launched point) is that I bet the AirBNB team didn’t feel like they were executing flawlessly along the way. It took them a number of iterations to get traction, and I’m sure they had doubts about how things would turn out. Mark Suster has a great post on the anti-kool-aid of looking at competitors: http://www.bothsidesoftheta…My point is just that even if one has early-stage competitors who look like they’re doing well, it’s probably not a good reason to throw in the towel. Of course, you have to take a hard look at your market and your team. But in the end, if you believe in the opportunity, you have to have faith that there will be multiple positionings and niches that will allow you to be successful even in a relatively competitive market.

        1. Nick Grossman

          Right, I totally agree w/ that. My comment definitely over-emphasizes the role of AirBnB in our decision to stop working on the project. Truth is, we were kind of having a hard time w/ momentum anyway, regardless of what competition may have been out there.

    6. Matt A. Myers

      Passion for product development and ADD without a passion for a solution to create focus is what that’s the result of. :)P.S. screenshot there looks pretty good. πŸ™‚

  11. scottythebody

    Love it.

  12. Glennfish

    LOL, as a serial (or is that cereal?) entrepreneur, I was struck by the idea that I should actually sell something first, then go ask for money. I guess it’s not a novel idea. My head was buried too deep in the technology thinking of all the gizmo elements that have to be resolved.Nice kick in my pants. My partner and I will do some serious chatting this a.m.Pitty we’re not in the software space. After 30 years of doing software, I can’t go back. I’d go blind.If I send you a prepaid Fed Ex envelope can you send me some Obama’os?

  13. ttunguz

    The AiBnB story is a scrappy entrepreneur’s story and the kind of startup investors seek to back in addition to the kind of startup employees should seek.The other great part about AirBnB is the disruptive force the company brings to market. AirBnB is a p2p market places. These market places are superb engines of more efficient asset allocation. In so doing, such market places unlock tremendous amounts of value for consumers and the environment. There is a more detailed description of the phenomenon here:…AirBnB is a great company and an example of a disruptive force in a huge industry.

    1. Barbara Pantuso

      I completely agree. This P2P disruption is creating “everyday entrepreneurs” and entirely new marketplaces where people can both save and earn money. In between that transaction is a HUGE business opportunity. We see this taking place in car sharing (e.g. Relay Rides), room/apt sharing (AirBnb), co-working spaces (the Hub), expertise sharing (Skillshare).I founded a startup called Hey, Neighbor! that does this with FAVOR sharing (we call them MicroFavors). Between neighbors, the opportunities to help each other abound and in turn, so does the ability to both save and earn money. People need help, and there are neighbors nearby who have idle time or idle resources. We are creating a marketplace for this exchange to happen easily. Some favors are just favors, others are favors-for-a-fee, but the benefits are financial, environmental, and social.AirBnB and Hey, Neighbor! are featured in a great talk about this very topic by Rachel Botsman, who is an expert on the Collaborative Consumption Movement.…This is the beginning of a huge shift in the market and I’m excited to be a part of it!Great post, Fred! Thank you for sharing your appreciation for the scrappy, perseverant entrepreneur and the notion that good ideas, a long term vision, and hard work can overcome some early doubts.

  14. andyswan

    I love this story. I remember seeing the box in conf room and thinking “no…there’s gotta be more. This is not how these guys would display their affection for a politician.”.Reminds me of the times I did illegal things to keep DaytradeTeam going.This Obama O’s is a classic. Will retell over bourbon many times.

    1. Dave W Baldwin

      You need to do

  15. bfeld

    I remember you mentioning this to me and asking what I thought. I was at my place in Keystone – I can’t remember if you were there also or if it was an email exchange. It was outside any of our themes and not our kind of thing, but I don’t remember really getting it at the time either. It’s pretty interesting to reflect on the long list of “ones we didn’t do” (ala Bessemer’s anti-portfolio), especially in the context of “if this came along today, would we invest in it this time around.

    1. falicon

      Fun to think about…but also a bit like old girlfriends you didn’t marry…there was probably some potential there, but ultimately there was a valid reason it didn’t work out at that time. =D

      1. ShanaC

        Sometimes, it is all in your head, wrong space, time, and you could have married…true antiportfolio sort of stuff

  16. blake41

    This story is really what being an entrepreneur is all about. So often in the tech press all I hear about is the cool new office so and so bought with their new funding round (hi businessinsider). I often feel like everything in the startup/tech space is moving towards celebrating money (founder X made Y money off his exit!) and funding (such and such startup pulls in 42m round!). I’m reading Jay-Z’s book right now (tip-everyone should read it) and it’s truly the story of “the hustle” and the entrepreneur. I think it wouldn’t be a bad thing for many entrepreneurs to go back to the model of the hustler trying to rub two sticks together to stay warm, rather than all preening like iconic rap stars lest we get caught up in the trappings of success. While Y Combinator has gotten people focused on Ramen profitable, I don’t think it really captures the notion of doing whatever you have to do to “get money”, but rather how to code at a subsistence level.

  17. kirklove

    So when are you getting the place in Park City so I can rent it on AirBnB? πŸ˜‰

    1. RichardF

      Deer Valley would be better

  18. Uncle Sam

    I tried Airbnb several times, looking to find an apartment in London, Barcelona, NYC.. but it was only a waste of time for me, unfortunately.The idea is great, but there are just too many people renting their properties who simply have no idea what they are really doing and how to do it responsibly.

  19. reece

    The funny part is that the Obama-O’s are just about the only thing in that conference room.Definitely hits the message home…

    1. andrewparker

      The box of cereal and also photos of Angkor Wat taken by Tommy Cohen’s wife. I looked at those photos for so long with longing… the first thing I did when I left USV in ’10 was go to Angkor Wat.

      1. reece

        that’s true. forgot about them.and you’re right to hit Angkor Wat – i was there in 2006. stunning place.

        1. fredwilson

          I’ve never been to ankgor wat. Those photos are fantastic

          1. reece

            i’ll give you a tour in a couple years. πŸ˜‰

  20. awaldstein

    Fred…one of my favorite posts.Seeing beyond the articulation of the idea into the vision of the founder has got to be part luck part poise part investment thesis on your part.You’ve got to miss some. And I bet you hit more than you miss. Am I correct?

  21. Sally @tripbod

    Fantastic to read thisAirbnb (and indeed Joe) have long been inspiration for us during the development of We have a similar goal of bringing new product sets online for the first time, by creating platforms for individuals to commercialise something they already have (in our case, great local knowledge).@ William Mougayar – not sure I understand all the complicated words you use, so forgive me if I’ve misunderstood… πŸ˜‰ But I think what Airbnb have done, like significant others before them, is build a highly engaged community faster and more effectively than anybody else. That seems to be the game here – and, as a result, there is likely only to be one major winner. Airbnb is indeed now distributing product B2B as well as B2C, but these brands you mention have no other way to reach that level of grass root (and awesome) product. So Airbnb kinda wins both games, don’t you think?Anyone who saw our mini-pitch at Launch will understand why we think this is all so encouraging, because for us it’s about creating new economies online… and in doing so cut out unnecessary middlemenSo congrats Airbnb, you guys deserve all the credit Fred gives you

    1. William Mougayar

      The hotels/travel booking companies I mentioned were an example of an adjacent category that AirBnB competes in. I’m saying that booking places across the universe will become a fragmented marketplace. You have to spend more to make more in order to keep your brand visible.There is zero switching costs for the end-user. I will go wherever I find the best deals or fit. I have no loyalty to,, travelocity, expedia, priceline, oyster- but I have used all of them at some point in time.

      1. Sally @tripbod

        Great point about booking places across the universe, but I still feel that it’s a different branding case and that the users on Airbnb do half the job for facilitates my booking a hotel in London. I have a great time and write a review of that hotel on TripAdvisor. does not feature in my thought process because they are faceless. So I agree with your point that they are embroiled in a war of gaining and retaining attention.Next time I visit London I try out and have a great time – this time I feel that, in part at least, it’s thanks to that I’ve been able to have this unique experience – so I rave about them on Facebook to my friends and also give a great review of the place I stayed. Next trip I’ll be straight back to Airbnb to see what gems they can offer up in my next destination.This scenario creates brand loyalty – more than that, it creates a tribe of like-minded people, which is exactly what we’re seeing happen. This week at ITB in Berlin I heard more people than not say ‘I’m staying at an airbnb pad here – and where possible I will never stay in a hotel again’. (ITB is world’s largest travel expo)So, pretty powerful stuff don’t you think?(this is not to mention that happy guests often become hosts and thus perpetuate the ecosystem…)

        1. William Mougayar

          There is nothing unique to AirBnB in what you described. Anyone can fan anything anywhere.

          1. Sally @tripbod

            I agree, nothing unique at all. But I didn’t say unique, I said different πŸ™‚

  22. jmcaddell

    Fred, this is a great story. As another commenter said, this is one of my favorite of all your posts. There’s a lot to think about in terms of how we make decisions. It seems that there was just too much distance between your firm’s experience/philosophy and how the founders communicated their vision in order to make a match, in spite of how strongly you felt about the capability of the founders. Perhaps the learning is that when you find yourself in that position again, you will lend slightly more weight to the founders’ potential and bridge that distance.On a separate subject, I have a site called The Mistake Bank (, where I collect stories of business mistakes so people can learn from others’ mistakes and better appreciate the value of reflecting on their own. This story would be a great addition. Would you be agreeable to me reposting it (with acknowledgement and a link back to this post)?regards, John

  23. CliffElam

    Whoa, I’m famous.I’m going out front to wait for CNBC to show up.-XC

  24. Mark Essel

    When you’re rapidly converging on great returns to your investors and looking for inspiration, I guess missing out on making even more money is as close to losing as you can get ;). The virtual loss.Your decision architecture for investing didn’t catch AirBnB in your net.Leakers happen, but are you willing to change the way you invest to catch a team like them next time, and consequently fund many more false alarms?

  25. Druce

    I used it recently in Dubai and Hong Kong… worked great! Even though I feel kind of old to be crashing with strangers I had to give it a try. For the lulz as the kids these days say.It’s such an out of the box idea (no cereal pun intended) I don’t think you should beat yourself up for asking how it could scale, avoid blowing up etc.But one of the Craigslist issues is trust, and with the photos, reviews, acting as escrow middleman, it does a pretty good job solving that, and there are definite possibilities for a lot of categories on Craigslist to be enhanced with similar features.greetings from Guangzhou! where I’m sticking to regular hotels…

  26. WA

    Japan. AirBnB. Utilization capacity expansion of existing technologies and apps. Nuclear tragedy seeks entrpreneurial fusion like solution. NPR peice this morning on maps being used not lining up with reality of what is on the ground for search-rescue-and sadly-recovery efforts. What is the penetration of Four-Sqaure and other GPS location based social media in these areas? What is the effort needed to adapt these techonologies to more accurate location finding needs for rescuers? What apps should be in development now to provide this to emergency services? As in a 911 GPS App for govenments, cities, agencies, etc.

  27. Matthew Crossett

    Great article, as always, I am doing a series of entrepreneurial blogs based around mistakes that were made by over 100 different entrepreneurs that i interviewed, and being that it just started, I will see if I can make this part of the thread, not focusing on or recognizing the potential in a team or idea. Thanks again,

  28. AVG Threat Labs Support

    post on avg

  29. Satish Mummareddy

    My take away from this story about AirBNB deal is “If a great team pitches something I do not understand, I should try again to understand their vision by spending more time using their service. If I still didn’t understand it then I shouldn’t fund it. If I get their vision then I fund it.”

  30. ShanaC

    So lets play reversee – did you ever invest in a product before the team?(Also, great story)

  31. Neil Braithwaite

    The truly interesting thing about Airbnb is that Airbnb was not the “idea” they were looking for in their attempt to start a business.Two guys getting together to come up with a business idea needed money to pay the rent.Airbnb was born of necessity, not passion – it paid the rent.The success of Airbnb proves that great ideas aren’t always born from passion.I believe the success of solving a problem planted a seed of passion in those two guys.Nurturing that seed is what brought about a full bloom of passion.The problem for VC’s is deciding which plants are worth watering.Tough job.

  32. andrewparker

    I’ve used airbnb 3 times since that meeting and they have all been great (and quirky) experiences. I don’t use it everytime I travel because the cognitive load is higher than just booking a cheap hotel, but it’s definitely more fun.To be fair, the story I heard about AirBnB’s pitch meeting is that Sequoia saw the product vision because they had been looking for a competitor to homeaway and vrbo for awhile. I’m sure they saw a compelling team too, but the product vision was more obvious to them because they were predisposed to see it from the angle of a larger, more interesting market.

    1. Austin Bryan

      We just used airbnb for the first time to rent an apartment in Paris.Wholly agree that the cognitive load is slightly higher, and a certain degree of flexibility and self-reliance is required, but for me the experience it affords is more than worth it.Not to mention, the iphone app is pure user interface porn. They should rename the company Wanderlust.

      1. Colin Nederkoorn

        I love the name wanderlust. A few years ago, I was in the concept stage of a site for travelstreams based on a microsite I built: desperately wanted to call it or What an awesome domain name.

    2. Nate Westheimer

      You’re spot on, Andrew. A VC who’s obsessed over a space can either be revved up and ready to go, or biased that “you’re doing it wrong,” but always good to hunt down those who are inclined to have given the space some thought. Either way, the meeting will go super fast and you’ll get a “yes” or a “no” faster.

      1. fredwilson

        You guys are so right about this

  33. paramendra

    This is an amazing story. You are quite a storyteller. Tell more stories.



    1. Matt A. Myers


  35. kenberger

    When was the moment of realization/kick yourself that this was on its way to hugeness? And what metric showed up and changed for you to believe that happened? Simply the recent growth numbers?I want to like this service, and should be the model user (could be the founder!) But every time i’ve tried to book a place in Austin, buenos aires, SF (many times), the hamptons, etc etc, I can’t find results to beat what I find on (which is instant, final, reliable, and delivers the certainty that comes with a brand name motel). Plus airbnb can feel very unknown, scammy, many people try to circumvent at deal time, etc etc.I understand that in time, this list of complaints might dwindle; most great startups had a similarly formidable list of problems early on. I’m just wondering where is the insight now coming from to declare this headed for “I’ll tell you what’s cool: $1B!”

  36. Harry DeMott

    As they say – necessity is the mother of invention.Last week I went to the CS Convergence Conference in Miami. Originally I couldn’t get a hotel room at the conference hotel – as the only rooms were blocked off for speakers. Noticing that there was an Internet radio panel on the schedule – I called some folks at CS and volunteered for the panel – and thus got a hotel room.Even better I got to sit next to Eyal on the panel and I got an update on just how well Targetspot is doing. And I made far more connections speaking than I would have if I just were networking in the crowd.Sometimes it just takes a little creativity.One question for you Fred:Having read through the comments – someone said that Sequoia got AirBnB because they were looking for a competitor to HomeAway or VRBO (both of which I have used in the past with great success) and you missed it because you didn’t understand the potential adjacencies of the idea. How often do you go looking for a team that is prosecuting an idea you are already thinking about versus having ideas come to you that are already pre-screened to some degree by your desire to invest in large engaged networks?Even if you knew what AirBnB was going to do, would it have made it through the large engaged network screen? or would it have been a stretch?

  37. David Anisman

    This is an awesome post.This must be the essence of being a great (as opposed to just lucky) VC. Being able to answer the question: if a billion dollar opportunity presents itself dressed as a couple of green visionary entrepreneurs with a wacky idea, will I see it? It is all about mentalflexibility.I imagine the cereal box in Fred’s meeting room is placed such both it and thepitching entrepreneurs are both in his field of view, teasing and reminding him, is this it? is this it?

  38. amin

    Fred, I just sent you an email a bit ago about listedplaces: http://www.listedplaces.comI wanted to post here as well in case my subject line was not efficient enough to trick your priority inbox. :)Again, thanks for sharing this story, the level of honesty and openness is really helpful specially for people trying to build similar products.Amin.

  39. Julien

    Great story, but being an AirBnB customer is even better.

  40. Keenan

    Motivating, fun, exciting, funny, informative, and just plain bad ass! This is a frickin’ awesome story!Love it Fred,I have hired more people without the “domain” expertise or standard “qualifications” than I can count and almost every time they work out. It’s when i’m short sighted and stick to the criteria checkbox that I lose.Talent doesn’t come with a check box . . . it’s kinda like Justice Potter Stewart and porn, I can’t tell you what it is, “but I know it when I see it.”

    1. Donna Brewington White

      I wondered if someone would pick up on the implications that this has for hiring — which are significant.I fully believe in approaching the hiring process with as clear an idea as possible of what you are looking for and targeting a certain set of skills, domain experience and personality characteristics, etc., and for the most part sticking with that (if you’ve done the right analytical work ahead of time) but there have been many times when I’ve met a prospective candidate who did not line up and yet I knew I was sitting across from (or on the phone with) “the one.”Question — When you make these kinds of hires (overriding the “criteria”), is it really a case of the person not meeting the requirements or is it that the ability to do the job is packaged differently than what you may have anticipated or what the norm would dictate? Or is there just something about the person that you intuitively know is right?



        1. Donna Brewington White

          I can’t find the words to offer a response.

      2. Keenan

        It depends on the requirements:I will always look for people with certain hard skills like: years of experience, industry knowledge, product knowledge, relationships etc, however at the end of the day, not hiring that KILLER sales person/talent who doesn’t have the hard skills kills me.For me; at the end of the day, I need someone who can do the job better than anyone else and that can’t judged by a checklist.

        1. Timothy Meade

          Interesting, I hope other hiring managers have that level of engagement with potential hires. I am currently build a service that will enable someone to show their unique talent while still constructing a creative and focused narrative resume. I plan to curate jobs for them while they feed me interesting data using criteria beyond mere keywords. I’m spending my days gathering domain knowledge and building a first iteration though still focused on the user experience and end user interface and building a user base to start with. I would love any and all feedback on what hiring manager would like to see in a jobseeker-focused website, what kind of data should be in my data feed for API integration with ATSs, etc.

  41. kidmercury

    great business, great story. i’m a big airbnb fan and am staying at an airbnb place, and will probably stay at another airbnb place in april. i was even previously considering the idea of living off airbnb. it is one of the few business models i think will do well even in the face of the rapidly approaching US dollar collapse, the bazillion pound gorilla in the room everyone thinks they are better off ignoring.

    1. David NoΓ«l

      I just stayed at an Airbnb in SF and it was a great experience. The apartment was amazing and the person who lived there a tech entrepreneur. Even if we have yet to meet in person, we had several great exchanges via email and one more person somewhere in the world I got to share a common interest with. Airbnb is about people and trust which is powerful.Bonus: this was my view:

  42. samharrison

    most VCs are lazy and invest in hype. That’s why they miss deals, they don’t want to do any real work understanding a team, market or industry. If you followed a deal pitch from beginning to end it would look like this:1) fill in VC website form2) get routed to the intern MBA who the VC firm hired to screen all deals…the intern has no experience building anything other than a bong hit3) sit in the intern MBAs “shit I don’t wanna read” box4) get scanned over by intern MBA to see if there’s any hype or Techcrunch article about the company5) Intern MBA copies and pastes the “not in our investment area” response6) hits send7) entrepreneur gets email response8) complete waste of time

    1. David NoΓ«l

      1) Identify who is your #1 firm and partner you want to work with based on their track record2) Do reference checks on the partner3) Do this by getting to know entrepreneurs who have worked with partner4) Ask said entrepreneurs to intro you to partner5) Engage in casual conversations with partner (comments, tweets, read: be visibile, show smarts & domain expertise)6) Align the dots and make sure partner has chance to align them too7) Meet, listen, learn8) Not a complete waste of time

      1. Johan

        Somebody already mentioned the striking similarity between hiring and investing. In both cases: The longer you’ve already engaged with somebody, the better the understanding of each other is and the better you can predict how they will perform in the future.And as David emphasized: engaging is dead easy today with tweets and comments. When you eventually meet somebody (or write 1-to-1 mails) best is if they already know who you are.

  43. Donna Brewington White

    At times, the similarities between VC and recruiting/hiring are striking.

  44. Ryan Galloway

    As a property owner, I have signed up and quit vrbo and airbnb as I dislike both of them from an owner’s perspective for several reasons (poor management tools, lack of innovation, high fees, and too many restrictions).I bought a property in Lake Tahoe several years ago, didn’t like the 40% commissions on bookings, and didn’t want to pay $400/yr for a poorly designed website that had few management tools (vrbo et al). I’m a developer so I created my own listing site and owner management tools catered to property owners at It was rather popular among Lake Tahoe owners for a bit.Unfortunately, I’m just a developer, not a savvy marketeer, so it doesn’t get as many hits as some of the big names. I actually used to work in the same building as Peter Thiel and sent him a feeler email to see if he was interested at all in investing in myrental, but never heard back. That was four years ago, before homeaway’s $25M buying spree.I agree with someone else’s comment about the market being fragmented and the competition over mindshare. I think homeaway is trying to do something about that, but I have some ideas of my own. I would love to get an investment, polish it up and relaunch the site.

  45. Ahmadali

    Two observations:-USV had first dibs on the investment-They consider it a mistake that they passed – meaning: there is an expectation of picking the winners out of their deal flowand also that a winner slipping through is an exception – meaning: deals they have passed on generally don’t do well.The points highlight the issue of adverse selection in VC.Top firms (like USV) get first dibs and pick out the best opportunities. Sometimes a good one slips through.But those are often picked off by the second tier VC firms.Pity the third tier and lower.I was having this conversation with a well-respected VC. He countered the adverse selection thesis by pointing to his investment in another startup, doing really well now, that was passed on by USV.However:-He only got to invest because USV didn’t see the vision (his own words if I remember correctly).-He is well known – a prolific twitter’er and blogger with influence – and therefore in the 2nd tier of VCs.meaning: he picked off the opportunity before it could end up downstream to other VCs.True: seed and early stage have so much risk that it’s hard to pick winners – especially compared to later stage.But adverse selection is still an issue.Perhaps this is old news and I’m a late arrival.

  46. panterosa,

    Fred,I am interested in knowing the connection of this post and the piece you commissioned from Hugh MacLeod which I received via his newsletter a few weeks ago, and immediately loved.

    1. fredwilson

      Is that the Wayne Gretzky hockey puck thing? Reading on a plane with no wifiso I can’t click

      1. panterosa,


  47. Kai Hui. Cai

    Thank you for this motivating story Fred!

  48. Michael Rad

    its true they were super scrappy in their ability raise early money, but even cooler, they gave future entrepreneurs tools to do the same. my brother and i were among the early nyc apts on airbnb and its helped to nearly offset one of our biggest expenses- rent.we always joke that abb has been holstee’s own stimulus package + for good reason. it played a huge roll in allowing us to almost exclusively focus on starting our company in the first year and half. now that we’ve got the ball rolling, we’re in a much better position to speak w investors, if we want.our listing on abb…the company this listing helped build

  49. obscurelyfamous

    Check out this post by Paul Graham which includes the email thread he had with Fred about airbnb.

  50. Bertil

    Please, Uncle VC, next week, could you tell us the story about the Jolly Rancher?

    1. fredwilson

      My wife brought them in when we first moved in and people love them. So wekeep them in stock

      1. Bertil

        If I may over-simplify blogging, I think your serious answer to my joke explains why you have the best blog around: attention to your audience, and our idiosyncrasies. I wouldn’t want to diminish the merits of candour, or your writing talent, but sometimes, success makes sense.

  51. Mrinal

    Never have I read all the comments of a blog post if they are beyond 20-30 and this time I read all 142 – it is amazing how your post brought out some neat experiences that lead to further insights.

    1. fredwilson

      I read every comment left on AVCSometimes it takes me a few days to get to them all

  52. Nacspost

    This is the most truly comment to all investors, thanks.” We made the classic mistake that all investors make. We focused too much on what they were doing at the time and not enough on what they could do, would do, and did do. “

  53. greenido

    Great post Fred (as in most of the cases :)I wonder, except from the box in the office what other methods you will try use in order to miss the next big ‘ebay’…

  54. howardlindzon

    i need three more of these to feel a little bit better πŸ™‚

  55. Emil

    Few posts ago I asked what was your biggest miss and why. This was more then a good answer. ThanksI believe that most important for a startup is to be a tool or platform that can morph to solve some needs of its users. The team should not stick with any finite idea or product and be ready to transform as the knowledge comes.If the reasoning and the team are right then the product they have today is just a moment in time.

  56. RichardF

    It’d be nice if airbnb looked at the office/desk space market could be really useful for start up’s and entrepreneurs.

      1. RichardF

        that is exactly what I mean!

  57. Nate Westheimer

    The thing that’s most often overlooked about AirBnB is the same thing that has dogged and Craigslist — it’s that these services use the Internet to get people off the Internet, serendipitously meeting new people.I call it “The School of Heiferman.”Jackie and I just got back from Austin, TX where we stayed in our first AirBnB. The house was this lovely cottage owned by a woman who organic gardens for a living. Seeing that Jackie and I are starting our own small garden out in NJ, this woman and her cottage were more than an alternative to a hotel room — it was an entirely better, richer, *more human* experience.If “The School of Heiferman” teaches us anything, it’s that services which get people interacting with people *offline* are greater than the sum of their online parts.

    1. David NoΓ«l

      “The School of Heiferman” – love it. @Fred: maybe @heif would be up to a guest post to outline this discipline.

    2. fredwilson

      More human is a really big deal

  58. David Shellabarger

    Fred, how important is it that you use use the service yourself to invest in it?I guessing you have not used Airbnb because you are not the in the demographic they are trying to reach (not initially at least).Do you always try out the product before you invest?How much does that affect your decision?

    1. fredwilson

      It matters a lot. Great insight

  59. David Smuts

    Kudos to USV for admitting this. Albeit, if i were looking at the investment I would have done the same!

  60. Kathryn Doyle

    Coming at it from the other side–do you think there’s anything Airbnb could’ve done differently to sell you, to help you see their big picture? When you look back, do you ever think, “if I’d just known X then or if I’d thought about it from X angle, I would have been compelled”?

    1. fredwilson

      They could have gotten me to use airbnb on my next trip to SF

  61. LIAD


  62. John Sharp

    Great story. Inspiring. Any more, Fred?

  63. RW

    I think the verdict is still out on AirBnBAt least a dozen people in my circle have tried it and left, both from a renter and landlord perspective.My own experience is that I’ve only successfully rented a place once out of 15 tries. At least with a real hotel the vacancy sign really means there are rooms. On AirBnB it means you have to wait to hear back from the owner. Also, NYC is effectively banning short term rentals starting in May.

  64. Syed Karim

    I wonder how many of Fred’s posts cause people to quit their jobs and pursue that idea that’s been gnawing away on the frontal lobe.About nine months ago, my partner and I had a fully operational alpha-version of a webapp that is almost identical to Zaarly, which I just learned received a $1M seed round (with no product to show). We had put the site together while still keeping our jobs, which means that neither one of us was committed enough. We decided to pull the cord on the project in November because, well, there was more near-term upside at our dayjobs (or so we thought). Four months later, Ashton Kutcher and Lightbank fund an almost identical idea.I loved the concept when I was working on it (real-time, real-life p2p exchange), but I didn’t love it enough to marry it. After we shut things down, I began to think that I might want to do the whole career-ladder thing. But each day I continue along that path, a little piece of me dies. So I’ve been chewing on another idea (consumer-web with a baked-in revenue model) and getting tons and tons of feedback from anyone who will listen to me. After coming across Reid Hoffman’s SXSW advice, news on Zaarly’s funding round, and finally Fred’s post about AirBnB, I’ve decided to marry my idea.Thanks, Fred. This is the inspiration I was waiting for.

    1. fredwilson

      i wish you the best luck and success Syed

  65. AneekMittal

    Thanks. Excellent Post. The comments motivate me to put more effort in my startup (couple of hours daily won’t lead anywhere). Thanks again.-Aneek

  66. guest

    Hi Everyone,What’s your take on a guy in mid-thirties starting a company? Do VCs back such people?Every success story I have read is started by a 19year old::))

  67. Tai

    When I first heard of Airbnb I was scheptical. After using the service and realizing the potential savings and benfits as traveler I was sold! I will use them from now on. The benefit of a host is that you have a personal concierge and you often get a better rate with more amenities than you would at a hotel. That is provided you pick a listing that has you sleeping on someone’s couch. Sorry you missed out on Airbnb but another one is just around the corner. The creative hustle of the Airbnb founder is something to be admired. This post is a great lesson for us all.


    Oh man, you just found me a new competitor!But I have to say there are two obvious distinctions here.1. I think they have a better designer than ours. Cause I like their layout more and I suppose most people do think so as well.2. It is kind of sad that a website tries to exclude the amazing power of internet from their business. Imagine I order an iPad2 from Apple store, it will be delivered to my front door in several days. But I hate it if I need to go to the post office to pick it up cause I am too lazy to do so. I bet many people do think so as well.

  69. Spencer Thompson

    It’s much, much closer to what Learnable is doing.

  70. Matt A. Myers

    Did you end up raising money for current one? We need to catch up. πŸ™‚ I’m busy moving out of my current place today, but I’ll give you a call soon or feel free to call and interrupt me / give me a break. πŸ™‚

  71. Dave W Baldwin

    Congrats Charlie!