Blitzscaling

Chapter 1: The Wimdu Wake-Up Call

Picture Brian Chesky in the spring of 2011. Airbnb has just celebrated its one millionth booking. Forty employees. One office in San Francisco. Seven million dollars raised. By the standards of every founder before him, he is doing extraordinarily well.

Then the Samwer brothers from Cologne send their proposal. Oliver, Marc, and Alexander have spent a decade cloning American startups in Europe. Their Alando outfit, a copy of eBay, sold to eBay itself for forty-three million dollars after just one hundred days of existence. Their Groupon copy, CityDeal, was bought out for what eventually became roughly thirty percent of Groupon's global sales. Now they have built Wimdu, a Berlin-based Airbnb clone, and stuffed it with ninety million dollars of fresh capital, four hundred employees, and twenty offices across Europe. All in a matter of weeks.

The offer is straightforward. Give us a quarter of Airbnb, and we hand you the keys to Wimdu. Refuse, and we will spend that ninety million making sure you never set foot in Europe. Andrew Mason, the Groupon CEO who had faced the same dealmakers eighteen months earlier, gave Chesky a single line of advice. "They're probably going to kill you."

Chesky asked his advisors what to do. Mark Zuckerberg said don't buy them, the best product will win. Paul Graham, his old Y Combinator partner, said it more colorfully: the Samwers are mercenaries, you are missionaries, and mercenaries lose because they're raising a baby they don't actually want. Reid Hoffman, the LinkedIn cofounder who would later write the book this story sits inside, agreed. Buying Wimdu meant inheriting a company built for an exit, fusing two cultures during the most fragile moment of Airbnb's growth, and slowing down at exactly the point where slowing down kills you. Hoffman's argument: with the network effects Airbnb already had, the right move was to fight, not buy.