This post is by Reid Hoffman from Reid Hoffman


With Airbnb’s IPO, I thought the time was right to take a look back at the past decade (Greylock led Airbnb’s Series A in November 2010) and reflect on what I learned from the journey. This essay is based on a Greymatter podcast episode, which you can listen to here.

HOW GREYLOCK INVESTED IN AIRBNB

Ironically, I missed my first opportunity to invest in Airbnb. The very first time that someone reached out to me about Airbnb, he described the business as, “It’s renting couches. Everyone has couches, and now you can rent them.” I replied, “That sounds really interesting. You should go do that.” But in my mind, I thought, “That doesn’t sound interesting at all.”

Couchsurfing is a bad product experience. There’s no privacy, and it’s just one step up from offering someone a sleeping bag in your backyard.

In contrast, picture renting an apartment on the Seine in Paris. I might even prefer that to the Four Seasons, because of the location and having a place to myself. That’s the power of what Airbnb actually did. But that wasn’t explained to me. So when various other people tried to reach out to me about Airbnb, I told them, “I’ve already heard all about it, and it’s not a good fit for me.” Oops.

Finally, one of Airbnb’s angel investors, who’s very smart and whom I respect a lot, reached out to me and said, “Hey, you should really look at this. These are really good founders (Read more…)