Die AirBnB Story explained in 500 words

From a retrospective perspective, most of the development stories of companies look like a fate. So also with AirBnB. Two young students can no longer afford the rent for their apartment. Because of this necessity, they sublet their apartment and can thus afford their rent.

In 2007 the two design students Joe Gebbie and Brian Chesky came up with the idea for the company. After successfully renting out their own apartment to three guests, they wanted to turn it into a business. After 6 months of searching, they found their third founder – Nathan Blecharczyk. He was an IT genius and built the first website in no time.

It was through media attention that they got their first big hype and after a short time they had 800 hosts on their website. But a short time later the traffic on the website was gone again. Since they needed money, they sold self-branded cereal. You were an Airbed & Breakfast. The trick was that they did that in the campaign year and named the cereals Obama O’s and Capn McCain. They made $ 30,000 from selling the cereal and caught the attention of a major tech investor from Silicon Valley. She shifted her to the Y Combinator for 3 months. A kind of training for start-up founders.

After that time, they knew they had to talk to their customers and find out how to help them. So they organized meetups with their hosts, edited their pictures for their apartments, showed people how to make money, etc.

Over time, sales continued to grow and more and more hosts and visitors came to the platform. Despite the growing size, the company was able to remain true to its mission and values.

Over time there were always minor and major problems that the company had to deal with. Like theft and devastation from guests. In 2011, a Harvard student researched the platform and found that colored hosts were getting a lot less bookings and money for their apartments. Colored guests were also turned down much more often. The study was published in 2016 and caused a shit storm.

But here, too, the founders reacted and were able to solve the problem by changing their terms and conditions and changes in the profile area of ​​the website.

With its growing size and global hosts, authorities and hotel associations also came up against the young company as a further hurdle. But they were able to get that under control and reached an agreement with many communities.

The book was published in 2017, at the time the company was not yet listed, but there was speculation about it at the end of the book. At the end of 2020, AirBnB actually went public and it was a great success. Now it remains exciting to see how the company will survive the Corona crisis and how it will develop in the future.

That will never work explained in 500 Words

Most people know this story of how Netflix came about: Reed Hasting, one of the founders of Netflix, had rented several video cassettes from Blockbuster Movies. He had forgotten to bring her back in time. When he brought the films back to the store after a few weeks, he paid nearly $ 40 in overdraft fees. He thought that couldn’t be, there must be better ways to do it. Then he founded Netflix.

This story sounds nice and you want to believe it. It almost makes the making of Netflix look like a necessity. But the truth is, it was very different. And that is the real story of the book That will never work.

The story starts 15 months before the Netflix website goes live. At the time, there wasn’t even the idea for Netflix, but there were countless others. The author Marc Randolph drives to work every day with his friend & mentor Reed Hasting. Every day he comes up with a new idea for a startup and discusses it with Reed. After 30 seconds at the latest, Reed explains why this cannot work. From personalized dog food to an online shop for shampoos, everything was there.

One evening Marc is watching a Disney film with his daughter and half asleep he comes up with the idea of ​​sending video cassettes online.

He immediately discusses the idea with Reed, who is not immediately against the idea. He mentions that he first had to pay $ 40 overdraft fees. You check the cost of the project. You have to buy the license for the film and the shipping there and back.

Video cassettes are really big. They quickly realize that it doesn’t pay off. By chance they read from DVD’s. They are supposed to become the next trend and replace video cassettes. You get a DVD and send it to Reed’s home in a simple stamped envelope. If this test works, you have found a working business model.

The DVD arrives intact. It’s time to start the engines. Reed & Marc found the company, build a team and start work. The website netflix.com goes live on April 14, 1998. It is an instant success. At the beginning, DVDs can be bought and borrowed.

After a while you will notice that more sales are made from selling DVDs than from lending them. You have to choose. In the long run, they can make more money by renting the films. You decide to do a cooperation with Amazon. They agree that Amazon users want to rent the films to Netflix and that Netflix users want to buy the films to Amazon.

They quickly realize that they have made a bad deal. Amazon made the link difficult to find and hardly any traffic arrives at them.

But there is no time to get upset about it. You have to create a sustainable movie rental business model. They experiment a lot until they arrive at the best solution: Subscription

In autumn 1998, Reed asked Marc for an interview. After a PR disaster and another bad cooperation, Reed realized that it couldn’t go on like this. Reed wants Marc to hand over his position as CEO to him. After a few emotional moments, Marc realizes the need and gives his post to Reed. Marc remains with the company as president.

The company is writing good numbers and everything is going well. There are takeover talks with blockbuster movies. However, they run in the sand. When things are going best, the dotcom crash comes. Nobody knows how to go on, but the customers continue to borrow DVDs diligently. After the situation has calmed down again, Netflix goes public on May 23, 2002. With that, the launch of Netflix ends, and so does the book.

Blue Ocean Shift explained in 750 Words

The metaphor behind the book is very easy to understand. A market (ocean) with a lot of competition (sharks) and few customers (fish) is blood red. Every customer is fought fiercely. In a blue ocean, you are the only one in your market and you have tons of customers.

So far so nice. Every entrepreneur wants a market in which I am the only supplier, i.e. have a monopoly. But the big question is how do I find such a blue ocean? The authors developed a 5-step plan.

Before we go into the step-by-step plan, let’s take a look at specific examples of how new markets are created.

1. Digital photography was such an innovative invention that it fundamentally changed the entire industry. Keyword Kodak. A new market is created by developing an innovative product that makes the old ones obsolete.
2. Viagra was developed by the pharmaceutical company Pfizer. Actually discovered more by accident. By discovering this drug, they created a new market for a previously neglected and unsolved problem.
3. Are there any healthy fries? Groupe SEB dealt with this question. She developed a hot air fryer that uses just one tablespoon of oil and still prepares crispy and tasty French fries. In doing so, they created a market by redefining a known problem that can only be solved through their product.

Stage 1. Get started

To get started, you get an idea of ​​the current product portfolio of your company. The authors have developed a pioneer-migrant-settler matrix for this purpose. On this you enter your current products and examine which of them are the most promising.

At this stage you also take care of your team. You can’t create a blue ocean on your own. You need the help of many other people for this. That is why humanity is an important part of a blue ocean shift. The authors have three tips for this topic as well.

1. Break down the major project Blue Ocean Shift into many small subtasks. That motivates and the management is much easier.
2. Diamonds are created under pressure, but not good ideas. All parties involved must understand the necessity of the change of strategy for themselves.
3. You can contribute to success through your own thoughts and actions.
4. In order to take all employees with you, you have to think of these three factors: Involvement – declaration – decision. Involve all employees in the project. Explain to them why this decision is necessary and what their role and expectations are.

 

Step 2. Define the current status

Now it’s about realizing the company’s own strengths and the realities of the industry / market. For this you use the strategy canvas. You draw the most important competitive factors in a coordinate system on the X axis and how high the value of your offer is for this factor on the Y axis. You do the same with all of your competitors. You can already see in which area everyone is bustling and where there is still a lot of potential.

With the Strategy Canvas in place, it’s time to convince everyone on the team that it’s time for a blue ocean.

 

Step 3. Define the target level

Investigate the buyer’s journey. What steps does the customer go through after purchasing the product. Where are the biggest pain points and how can you use them for yourself.

Why are there so many non-customers for this market. Ask the target groups who don’t use your product. Find out why this is out of the question for you. Can you develop a product that can convince this target group?

 

Level 4. Finding out the way to get there

With the help of the Six-Paths Framework you can find out what market barriers there are for a blue ocean:

Path 1 – Check out alternative industries
Path 2 – Look at strategic groups within your industry
Path 3 – Look at the different buying decision makers
Path 4 – Check out complementary products
Path 5 – Consider the functional and emotional alignment of your industry
Path 6 – Create sustainable external trends

In addition, you use the Four Actions Framework at this stage. So you decide which factors can be

eliminated – reduced – increased – generated

This allows you to stand out from your competition and move into new, fresh markets.

 

Level 5. Set sail

After you’ve gone through all of the steps, it’s time to make your findings public. First, you invite all those involved in the company (investors, department heads, suppliers, etc.) and present them with the findings from levels 1-4. Everyone needs to understand the necessity and their role in this blue ocean shift.

Rapid market tests are then carried out in the individual departments to validate the assumptions. After these tests, the big picture is written down in a business model. The business model must be a win-win situation for the company and the customers.

From then on it is time to set sail and head for the Blue Ocean.

Lean Startup explained in 500 Words

It was only a matter of time before a book like Lean Startup upset the entire management world. The book was published in 2011. At that time, Facebook & Co were on the advance, smartphones were mass-produced and globalization has reached its peak. The world was spinning faster.

This also meant that companies had to act faster. Eric Ries actually wrote the book for startups, but now he and his team also coach large corporations on how to use lean methods in their companies.

Nowadays it is no longer important to be the greatest, but to be the fastest.

How do you get to scale up?

The first step is to validate your ideas. You make hypotheses about your business model. “I believe I can profitably sell raccoons to zoos over the Internet.”

or

“I believe the perfect audience for my self-cleaning sink would be single mothers.”

Once you’ve made your hypotheses, you validate them.

There used to be no 3D printers or Facebook

The best way to test your hypotheses is with an MVP. So a minimum viable product. Something that is not perfect, but fulfills your core value promise.

For the raccoons, that could be a landing page. A video by the sinks. There are many different types of MVPs. It doesn’t always have to be a tangible object. It has to convey your core values ​​promise so that you can validate your hypotheses.

Types of MVPs:

• Online advertisements
• Waiting list
• Crowdfunding
• Wizard of Oz
• Smoke test
• Landing Page
• Concierge test
• A Problem Solution Interview

 

Time to go round in circles

The core of the Lean Startup book is the Build-Measure-Learn cycle. Once you’ve created your prototype, you start collecting data.

Measure up

You run out into the street and interview your potential target group. There is now a lot of reading material on this topic, such as the Book Talking to Humans*.. There you will find detailed instructions and guidelines on how and where you can interview your target group. You can also do this online, but at the very beginning you have to speak to your target audience in person. You don’t get that many interviews in quantitative terms, but qualitatively you will quickly notice that these conversations are worth their weight in gold.

Learn

After the interviews, you evaluate your data, create new hypotheses, build a prototype again and interview your target group. You keep doing this until you have validated hypotheses that can be expanded into a scalable and sustainable company.

The cycle never ends completely. Instead, it becomes more finely divided. Instead of checking the whole business model, you check individual features of your product, the design of your website, your advertisements, etc. All the things that are important to your main metrics. But which key figures are important?

100,000 followers won’t do you any good

One chapter deals in detail with the topic of vanity metrics. These are key figures that make you look good at the regulars’ table, but have little meaning for your company. These numbers include the number of followers, the number of press releases about your company, or those numbers that can only go up (e.g. total number of downloads of your app). These KPIs have no meaningfulness about your only true goal. Build a sustainable and scalable business model.

CONCLUSION: If you have an idea for a company or are already fully in the process of founding it, you have to read this book. It helps you to stick to the core of your idea and build a sustainable business model from it.

 

 

 

Scaling Lean explained in 500 Words

The book Scaling Lean is an advanced reading. I recommend books to you like Lean Start Up*, Engpasskonzentrierte Strategie*, OKR* & Scaling Up* having read before.

At the beginning of the book, Ash explains to Maurya his understanding of Lean.

GO LEAN

G = Goal: Define your goal in a functioning business model.

O = Observe and Orient: Learn to benchmark your key figures and better assess risk.

L = Lean, Leverage or Lift: Use Lean Sprints to quickly see success in the business model. Learn more about your bottleneck – leverage your bottleneck – strength the solution to the bottleneck.

E = Experiment: Run small experiments quickly to test your ideas

A = Analysis: All of your experiments must be closely tied to your goal / strategy.

N = Next Actions: The analysis specifies the next actions.

You will be guided through these 6 principles in the following chapters. For the Goal, he created a simple formula for each business model:

Created Value> Captured Value> = Cost (Value Delivery). Your created value must be greater for the customer than what he pays (captured value). And what he pays must be greater than or equal to your cost.

 

Rate traction as the most important KPI, not sales. What is traction?

Traction is linked to the previous key user actions. These past key user actions are the most important indicators for examining future growth.

Example: Starbucks has recognized that the time a customer spends in the store correlates with the sales per customer. So a key action was getting customers to spend more time in the store.

Traction is the one metric that matters most. Traction is the rate at which a business model captures monetizable value from its customers. A time traction goal is much more tangible than a sales goal.

In addition to traction, there are two essential key figures:

Throughput is traction

The more customers you can send through the “customer factory” in a faster time (without losing quality), the faster and bigger your company can become.

Customer throughput vs throughput

Customer throughput measures the rate at which you are creating customers. The throughput measures the rate at which you create monetizable value from your customers.

There are three phases in every start-up:

Problem Solution Fit
The overall goal of this phase is to test that your idea is a significant enough problem to be resolved.
You test this phase with an “offer”. Before you built the product or take care of financing. An offer consists of UVP, DEMO & PRICING

Product Market Fit
The overall goal of this phase is to demonstrate that your
Small-scale business model works

Scale
This phase is not about driving your product to perfection, but rather finding the right levers for growth in order to realize the full potential of the business model.

Identify and resolve bottlenecks

At each point in these phases you will encounter different bottlenecks. These can be external and internal factors.

Solve for Happy explained in 1000 words

The book deals with the question of how to become permanently happy. You get the answer at the beginning of the book. Our basic state is to be happy. Children are always happy, unless something is missing, hunger, tiredness, etc. Otherwise, they are always happy.

Our basic state is to be happy. Children are always happy unless their body has needs. If happiness is our basic state, there must be things that block this basic state. The author recognized 6 illusions & 7 blind spots that make us unhappy:

The 6 great illusions

Thoughts
You are not your thoughts Do not define yourself by your thoughts. It is the thought, not the actual event, that makes you unhappy.

Self
About what do you define your self? About your appearance, your clothes, your possessions? All of this is not your self.
You are not your body, feelings, beliefs, name, group you belong to, family tree, accomplishments, or possessions. You are the observer. You are the one who sees. What is left of you when you die is your self.

Knowledge
You are not your knowledge. Even if you think you know an incredible amount, you don’t know anything. True knowledge means knowing the extent of one’s ignorance. Nothing is good or bad, only thinking makes it so.

Time
Time doesn’t move, you move through time. Time is different for everyone. There are three known times, past, present & future.
In short, live in the here and now (present) and you will be happy.

Control
You have nothing under control. No matter how many insurances, calculations or protective clothing you wear, you have nothing under control. Act responsibly, then let go of the need for control. In the end we will be fine. If it’s not good, it’s not the end.

Anxiety
Everyone is afraid of something. But these fears are unfounded and slow us down.
Openly admit that you are afraid of something. Ask yourself whether you are really free. If not, why not? What concerns are holding you back? These are your fears.

7 blind spots – brain defects

Because of our past, we humans are endowed with reflexes and impulses. The best known are Fight or Flight. But these reflexes hardly make sense in today’s world. Only in the rarest of cases do we stay in regions where a wild animal could suddenly attack and eat us. To protect against this, nature has equipped us with functions that make us unhappy today.

Filter
Our picture of the world is always incomplete as our brain leaves out parts of the truth in order to focus on what it thinks is a priority. Unfortunately, we often filter out the positive and only the negative.

Assumptions
In order to make decisions, the brain needs a coherent, understandable set of information. After filtering out most of the truth, it proceeds to accept the missing information. Assumptions distort the truth even on the physical plane. An assumption is nothing other than a story generated by the brain. It is not true!

Prophecies
Our brains make predictions to fill in the gaps. And what’s the big gap? The future. Your predictions are no different from future possibilities generated by your brain. They didn’t happen. You are not the truth.

Memories
The brain looks back to mix our perceptions of current events with memories from the past. We mix our memories with present reality and create a view that is colored by the past. Your memories are nothing more than a record of what you think happened. Often it is not true.

Assignments (prejudices)
Memories add a series of past events to the truth. Assignments also come from the past, but are more effective. With people in particular, the brain very quickly makes prejudices and labels every person.

Emotions
Emotions make us human, but when we mix them with logic, they can reduce our judgment. Decisions are usually guided by logic, but our actions are guided by emotions. Because of this, we are not as rational as we think. Our perception of reality is often clouded by irrational emotions.

Exaggeration
Our brain lives according to the motto: You can never be too careful. The brain tries to attract its attention by exaggerating. But what is more than the truth is far from true.

 

The 5 ultimate truths

In order to be really completely happy, you still need the 5 ultimate truths.

Now
Being fully aware of the present moment increases chances of being happy many times over. Mindfulness is not an on / off switch. It is a brightness regulator. You don’t have to do anything to be mindful. Your default setting is mindfulness. In order to increase it, you have to stop doing it. Don’t multitask – whatever you’re doing, give it your full attention.

Change
If one thing is certain, it is that nothing is certain. Change is real. Change is always and always. Don’t fight it, just accept it. Let everything find its balance.
Don’t look up, look down and be grateful for where you are and how you are. Gratitude is a sure way to be happy. (Instead of being bitter that he died, I’m grateful that he lived)

Love
Unconditional love is real. It is the only emotion that does not come from your thoughts in our head. You are happy because your love does not come with expectations. No expectation will never turn into a disappointed expectation. Love is never wasted The more you give away, the more loved you will feel. Stay away from people who are only negative. Give them three chances and then away with it. Choose to be nice instead of right.

Death
Live in Peace – not Rest in Peace. The day will come when you have to die. We die a little every day. Without death there would be no life. Death is always inconvenient. Sooner or later we are all ready to die. Death won’t hurt you. Life is always. Our bodies fall apart, but we never die ourselves. Live before you die. See everything in life on loan. Your house, your children, your wife, your trophies. When you die, you give it all away. If you don’t own anything, you can’t lose anything.

Draft – designer
Is there a god / designer or was everything created through evolution?
The probability that everything was created by chance evolution and the Big Bang alone is zero. That everything is created and administered by one God is, well, let’s say a question of faith. It is more likely that a designer developed the principles and systems from which today’s world and the universe emerged. But he doesn’t manage it. He is not responsible for natural disasters, disease and wars. He set the framework in which we live and it is up to us to make the best of it. Live the truth – being happy is actually that simple.