What a $20 billion startup looks like when it's just starting out, and everyone thinks the idea is stupid: Here's Airbnb's first-ever pitch deck

Airbnb was initially called AirBed&Breakfast. It was a marketplace for crashing at a local's apartment on a blow-up air mattress.

"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," legendary investor Fred Wilson now says regretfully. His team passed on Airbnb's early financing round.

But the founders persisted. They thought the web could be a powerful booking tool. And when investors like Wilson weren't eager to give them funding, they turned to their own devices...

The founders bought a bunch of boxes of Cheerios and designed new cereal boxes around the McCain-Obama election. They stuffed the boxes with the cereal and sold them, and used the cash to seed Airbnb.

Airbnb's founders noticed a competitor, CouchSurfing, was taking off. They felt their air mattress rental business could tap into the same market.

*Note this Obama O's slide is not in the founders' initial pitch deck, but it's a big part of their founding story.

They determined the size of the online room-booking industry was worth billions upon billions.

The Airbnb web tool looked a lot more like Craigslist or even a social media profile back then.

For reference, Airbnb now looks like this:

Airbnb planned to take a 10% commission on every booking. Now the company charges 6-12% per booking plus a 3% fee for the host.

Airbnb hoped to grow by targeting big events and partnering with marketplaces like Kayak. It also crossposted a lot of its listings to Craigslist in the early days.

At the time, Hostels.com seemed to be the closest competitor to Airbnb.

The biggest advantage (and disadvantage) Airbnb had was that it was first to market, and it had get people thinking that sleeping at a stranger's apartment was a safe and okay idea. Now it has listings in 34,000 cities and estimated bookings of 37 million nights per year.

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