In 2008, Airbnb was near death. Founders Brian Chesky and Joe Gebbia were living off dry cereal. If they didn’t raise this $500,000, it was probably over.
This morning, I dug into the pitch deck Brian and his team used to raise that crucial round of funding.
Framing the Problem
Brian does a great job of explaining what Airbnb does and why you need it.
For travelers, it’s cheaper and more fun. For hosts, it’s an income stream.
Many startups aren’t clear about what they do and why. But “We save people money on travel,” that I get.
Be sure to clearly say what you do and why it matters.
How Big Is This Market?
The market for crashing in people’s spare rooms was pretty tiny in 2008. Airbnb basically created it.
Some investors would look at that market and say “this is niche, no thanks.”
But Brian shows them an adjacent market that’s huge — travel in general.
One thing I’d change here: make that slide “dollars,” not “trips.” It’s not easy to translate between a number of trips and an actual dollar figure.
Today, the global market for budget hotels is $276 billion. Put numbers like that in front of VC’s, and watch the drool dribble down their chins.
But How’s the Product?
Brian shows us the product in the deck and points out some of its great features. This is genius — every startup should do this.
I especially liked the dual posting feature with Craigslist. This is an easy way to get a lot more eyes on those Airbnb listings.
Brian doesn’t show every screen, just a few key features. That’s the right approach.
A Team of Builders
For a company this early stage, the team slide is critical. Airbnb is strong here, with two designers and a developer.
YC’s rule is teams of 2-4, at least half technical. I think that’s as good a rule as any, and Airbnb fits the bill.
Fanatical Users: The Trump Card
Airbnb had a great team operating in a giant market. But what really drew me in were the customer testimonials.
People just loved using Airbnb!
I strongly suggest every startup include a slide like this.
What’s Missing?
One really important slide is missing here: traction.
Brian didn’t include anything about revenue. That’s probably because at this time, Airbnb didn’t really have any.
They’d been grinding away on the business since October 2007, but had only made a couple thousand dollars. They’d actually made far more selling cereal than renting rooms!
So Brian led with what he had! He had some happy customers, a cool product, and a great team.
You work with what you’ve got. And in Brian’s case, it was enough.
Wrap-Up
Airbnb’s deck is a great example for early stage startups.
Brian frames a big problem. Then, he shows us how he’ll solve it. Finally, he gives us some early signs it’s working.
That’s exactly what you want to do. Big problem, solution, traction.
Give us that, and your chances of raising money will skyrocket.
What do you think of the Airbnb deck? Leave a comment and let us know!
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