How Airbed & Breakfast became Airbnb ?

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“Creativity is the solution to all problems”- Brian Chesky , co Founder and CEO at Airbnb

For those who don’t know, Airbnb is an online marketplace where people can lease or rent short term lodging. The $31 billion company does not own any lodging but is merely a broker.

So how did two unemployed friends(3 founder joining a little later) became the founders of a billion dollar company.

 

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Nathan Blecharczyk , Joe Gebbia , Brian Chesky (from left to right)

 

The story starts at Rhode Island School of Design where Brian Chesky met Joe Gebbia. On the day of graduation Joe says to him ‘Brian, one day we are going to be entrepreneurs’. A few years passed and one day in 2007 both of them quit their jobs and decide to start a company together. With absolutely no business idea and a $1000 in bank account and a sleeping bag Brian drove to San Francisco. Turned out the rent for Joe’s apartment was $1150. Strangled with debt they thought of an idea to provide accommodation in their apartment to people coming for a IDSA( Industrial Designers Society Of America )conference in town at the rates that were far less than an hotel. In 24 hours they built a website called Airbedandbreakfast.com and mailed the top design bloggers and in overnight Airbed and breakfast was at the top of the blogger’s page.

An idea that came 48 hours ago to save them from cash crunch was now live on the internet. To their surprise people from all over the world were writing to them. Finally 3 people who came to attend the conference , one of whom was an Indian slept on the airbeds in their living room and became their first guest.

It was then that it struck Brian what if you could book someone’s home the way you book a hotel anywhere in the world.

In 2008 they incorporated the company as Airbed and breakfast. They even called upon their “former roommate ” and “brilliant engineer” Nathan Blecharczyk, to join as the third co-founder of the new venture.  To fund the site they created special edition breakfast cereals with presidential candidates Obama and John McCain as the box designs. At $40 a box they generated $30,000 for company’s incubation. All of this created a buzz and in 2009 Y Combinator invested a whooping $20000 in the company as an initial investment ( they had joined Y Combinator’s 2009 Winter Class) . They were further funded by SEQUOIA CAPITAL . The name was now changed to Airbnb and it offered not only rooms and apartments but also castles, manors, boats, tree houses, private island and even an IGLOO, yes you heard it right.

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Today Airbnb is the No.1 lodging website in UK. Many people who were on the brink of losing their homes through foreclosure due to financial hardship, have come to depend on Airbnb for additional income. It can be said that it has been a blessing in disguise to various people out there , just as it was one for the founders who got to live their “one day” dream by solving an intricate  problem .

but you need to know that the story was not as rosy as it seems and many a days they had to live on cereals only


This is a GUEST BLOG written by my best friend Umang Mittal who like me is a huge startup enthusiast . And edited by me! I hope you enjoyed reading it and came to know the story that you might have wondered about  !

Waiting for your views and comments!

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The McDonald’s Delhi story !

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So just a few days back I was with my cousins , as we were celebrating Rakhi and the youngest of the lot my two brothers of 6 and 7 repeatedly kept on saying that they wanted to go to McDonalds , and we had to repeatedly answer them that they were closed and they would have to try a different place.

This stance got everyone to ask that why exactly is McDonalds closed in India . So here is the answer .

In India McDonald’s is a 50:50 joint venture between McDonald’s India Pvt Ltd (MIPL) and Westlife Development in south and west India (261 McDonalds and 121 McCafes ) and Connaught Plaza Restaurants Ltd in north and east India.  But there are issues revolving around CPRL which have eventually led to this closure which date back to 2013 .

In 2013, McDonald’s had voted against the re-election of Mr.Bakshi as managing director of Connaught Plaza ( due to their own internal tussle as per which the US brand believes that Bakshi was cheating them), following which Bakshi challenged his removal in the Company Law Board (now the National Company Law Tribunal ), accusing McDonald’s of mismanagement and oppression.

The same year, McDonald’s revoked its joint venture with Connaught Plaza and invoked arbitration against Bakshi. It has been pursuing arbitration against Bakshi in the London Court of International Arbitration. This was challenged before the Delhi high court.
On 23 December 2016, Justice V.K. Shali prohibited any change in the shareholding of the Indian arm of the company. This order was lifted by the two-judge bench in July.

Separately, under an order passed by the Company Law Board on 16 September 2013, McDonald’s was directed to maintain status quo over the shareholding pattern and right of call option, which is still in operation.

In June this year , McDonald’s shut 41 of its 55 restaurants in Delhi following its failure to renew their health and eating licenses. which resultantly happened due to a unstable management .The National Company Law Tribunal (NCLT) in second week of July reinstated Vikram Bakshi as managing director of CPRL. Leaving a unclear picture for the spectators on whos right and whos wrong.

So now the BIG question remains how McDonalds will revive itself in India , with competition everywhere , with Indian brands also joining the fight( Haldiram and Nirulas ) . Because at the end of the day its your presence that matters because if your shutters are down , customers would eventually go and try the next best thing , which might topple your brand eventually  .

So do these tussles actually help anyone ? Does a management fiasco really satisfy the end goal for which a company is made ?

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THE ACCIDENTAL BILLIONARES BY BEN MEZRICH BOOK REVIEW 

“Information is meant to be shared. Pictures are meant to be looked at “

We all have heard the name of the movie THE SOCIAL NETWORK, and as far as I remember I loved it and till date have watched it a gazillion times (partial blame on Andrew Garfield).So this is the book on which the movie was based and it’s better with a garrulous description of the Silicon Valley and none other than the Harvard University.

What amazed me was Mark Zuckerberg’s brilliance and idea which surpassed all the ideas for social networking in the early 2000’s. How he eliminated all the faults present in Orkut, Friendster and gave us all something amazing to connect with our friends (because after all they are the most important).

Mr. Ben Mezrich has written the book brilliantly. He has kept the characters out there and left it on us who to judge and who to not. Capturing Mark Zuckerberg’s and Eduardo Saverins friendship , its ups and down, how friendship and business muddled together is though easy on the look but tough to maintain , entrance of Sean Parker( the guy who started the hacking battle for free music streaming) , the amazing Peter Thiel ( and Facebooks early investor) and last but not the least the Winklevoss twins.

So it’s a must read for those who want a glimpse of this billion dollar company, its founding, its bumpy ride, battle between cofounders, every investor wanting a part of this new found baby and last but not the least Mark Zuckerberg who did everything to keep Facebook for what it stands .

​THE LINCHPIN CALLED JIO FOR THE TELECOM SECTOR

India has an ever growing 2 billion telecom (telephone, mobile) subscribers. Before Jios majestic arrival prices and connectivity both soared. But Jio tried changing that on both the spheres. Its entrance into the telecom sector has led to a massive ripple effect. India’s 2nd and 3rd largest operators Vodafone India and Idea Cellular have agreed to a 1.5lakh crore deal which will make them world No. 2 after China Mobile. Airtel is no longer number 1. Telenor has decide to exit India by it being acquired by Airtel. There is a prediction of 1 million jobs being lost in one of the most sought after sector in our country. The industry’s never ending debt is going to surpass 4,60,000 crore
Every story has two sides and so does this one. Jios entry has made access to internet that to 4G every man’s ability. Competing companies have started lowering their ever increasing prices. Jio has made its place in a matter of 7 months in a highly competitive and price sensitive market, with a few problems such as denial of POI (Point Of Interface) due to which its competitors face a fine of 3050 crore levied by TRAI.

But on the other hand the competitors claim that they did abide by the telecom guidelines to be followed when a new entrant enters the market. Impact of lower tariff and hence decline in revenue of telecom operators would lead to a delay in their spectrum payment. Airtel claims Jios plan to be “a strategic business tactic adopted to enhance market power with the objective of eliminating competition which it has succeeded to a large extent during the quarter Oct to Dec 2016 itself,”

I personally believe that Jios extravagant entrance to telecom sector has had its positives and negatives. But too many freebies never end up on good terms in the cycle of economics, capitalism and a consumer friendly market.

THE GREATEST TRADE EVER BY GREGORY ZUCKERMAN BOOK REVIEW

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“There is no intoxicant more dangerous than cheap money and excessive credit “- Benjamin.M.Anderson

So as you might have guessed from the cover above this book is about someone who ended up making huge bucks. Well to clear the mystery, Greg Paulson made $4billion in 2007 by betting against the housing marketing (his bet was that housing market would collapse like chunks of dominoes). It was the largest one-year payout in the history of financial markets.

This book overviews those who ended up making money when everyone around the world was losing it. Famously called as the 2008 FINANCIAL CRISIS”.  It revolves around GREG PAULSON, MICHEAL BURRY, PAOLO PELLIGRINI, GREG LIPPMAN, ANDREW LAHDE and JEFFREY GREENE. The ones who understood that something was wrong when everyone else was throwing bonus parties. That the financial industry was growing at a faster pace than the economy itself (a kind of financial alchemy being at work).

To me it cleared the landscape of the 2008 downturn and the years preceding it. How these few people could see and ascertain what others were oblivious about. It relays a time in the western financial world where even a kid in 4th grade qualified as a borrower. After the dotcom bubble in early 2000’s interest rates were reduced which led to excessive borrowing giving way to the housing bubble. There was a casino active at the world stage.
The book goes deep into numbers. Explaining thoroughly. The inside story of Bear Sterns, Deutsche bank, Morgan Stanley and many more are veiled out. It reveals how one side believed that the economy would grow to great lengths and another small group feared a dangerous downturn.
This books a must read for the ones who breathe and taste finance, who would love to understand the history of finance a bit better and for the ones who believe you can always be amateur and scale great mountains. And the book doesn’t bore at all.

$$$


SO WHAT DO YOU THINK OF THE REVIEW ?

DO YOU PLAN TO READ IT ?

DO SHARE YOUR VIEWS.!

PAYTM KARO! PAY THROUGH MOBILE!

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Right now my favorite pass time is going and asking and seeing whether shop vendors have paytm or not. Last week when we went for shopping, all our payment were through the one and only “paytm wallet”.

So a brief intro. of this game changer is that it was formed by Vijay shekhar sharma (Vjs), alumnus of DTU .He joined college at the age of 15 .Hailing from Aligarh the biggest drawback he faced was adapting to the alien language English. Always being a kitabi keeda (in his own words) he ended up making a company in 1997 (last years of college which he later sold).Being a true patriot he wanted to do something for India and didn’t choose a job in the land of immigrants (U.S.A)

So basically Paytm’s parent company is One97 Communications in which Jack Ma (founder of Alibaba) has 40% share, the largest shareholding and Vjs has 21%. Their business is divided into e-commerce, online recharge and payment wallet (the leader of the three).

Just a few days back they got RBI’s final approval to start with the operations of India first payment bank (which would start in a month). In which Vjs would have 51% share (making it purely Indian).

Paytm is the story of struggle to make accessibility of money easier and a pathway towards a cashless society. What was beautiful was that the day after the announcement of demonitisation Paytm had a two page advertisement in the newspaper (for which they had to make the printing press wait till 12:30 at night) .It tells there will always be people out there to challenge the status quo (SBI being so scared by it that its persuading its customers to download SBI-buddy)

Paytm got what we call in the business world “THE FIRST MOVER ADVANTAGE”

 

A payments bank in simple words,  can carry out most banking operations but can’t advance loans or issue credit cards. It can accept demand deposits (up to Rs 1 lakh), offer remittance services, mobile payments/transfers/purchases and other banking services like ATM/debit cards, net banking and third party fund transfers.

REDCARPET- THE CARPET TO YOUR FINANCIAL STARDOM!!

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So I have had the chance to meet a RBI governor (let’s say THE RBI governor – Raghuram Rajan a few months back) and now a startup co-founder (Abhay Tamaria of REDCARPET). We had a competition being organized in our college by our marketing society where this startup was a sponsorer.

I had a small chat with Mr. Abhay Tamaria (IIM B Alumnus-finance and marketing – that calls for a clapping) and what I distinctively remember him saying is that if you dream of being an entrepreneur start observing your surrounding cause the next big thing might be in front of your eyes and alongside start analyzing the market around you.

Basically red-carpet is any college student’s personal credit card (they are basically becoming the new credit raters for the future loan takers) a startup based in Delhi-NCR as of now with the plans of making big (their official site claim that it’s better to be good than to be huge). We all know about Paytm and PayPal, they are our personal debit cards so this is just the opposite of that. They stepped on this idea with their diligent thinking and business environment observation.

This indicates towards the growing micro fiancé companies in our country, that to the ones who are looking forward towards a stability. In today’s Indian economy with a 60 % population below 27 and with the new dynamics of micro finance credit has become the need of the day. Today getting loans for online purchases, movie booking, ordering food is what any college kid looks forward too. So here’s red carpet providing loans to students in easy EMI’s.

So I guess you college students after reading this blog you would go to your play store (the ones staying in Delhi-NCR region  … others it’s just a matter of time) and give this app a chance.

The baton being passed.

RBI Governor Raghuram Rajan with deputy governor Urjit Patel.

So we all have embraced the news of a new RBI governor (the media leaves no one in a loop). For the past 2-3 days the newspapers have overflowing articles on what would be expected of the to be governor on prospects such as inflation, growth, deficit, growth along with deficit. (Really huge words for a layman).

As a new legal citizen of this nation(just turned 18) , a huge fan of Raghuram Rajan and a student of commerce background here are something’s even I would like to say to the to be governor( why should I leave a chance)

RESPECTED SIR

Congrats for getting such a prestigious chair because it’s a real tough one to get. I hope you continue the legacy and by your decision zeal and aura motivate kids of this generation to pursue subjects related to finance, Economics, accounts. Well the inflation rate is on my agenda too (how I can I leave that golden word). I hope you keep that controlled so that eating pulses doesn’t become a luxury. The forex reserves shouldn’t decrease too (because we Indians love dollars). Furthermore coming on a serious note. I read that when you worked with IMF at the Indian desk we were in the midst of our balance of payment crisis and you were a huge supporter of the nation of your origin so definitely thanks for that. Further that your policy of 3% fiscal deficit motivated the Indian government to try and achieve it.Thanks for it too. And what else. I guess nothing more. I would like to say all the best for this new journey and may the odds be in your favor.