When Airbnb was first started in San Francisco, I had three friends who immediately got into the business.
Does that mean anything to you?
One was a game developer, no surprise. He bought three condos and rented them out.
The second was a salaryman who bought five houses in New Orleans with the intention of moving there to rent them out.
The third was a psychotherapist who rented out her city apartment for $5,000 a month and stayed at her country farmhouse.
The interesting thing about this event was that two of these emerging entrepreneurs were not the kind of person one expects to start a business. It says to me that America is a land of millions of potential entrepreneurs who will start a business if they are given the slightest genuine opportunity. This is truly America. Commerce is deeply American.
The first and third were almost immediately put out of business by the rules San Francisco put in place to make Airbnb unworkable. The first soon moved to Los Angeles. The second was soon put out of business by the city government of New Orleans that made Airbnb unworkable.
The CEO of Airbnb is Brian Chesky. He and his founding partner were both graduates of the Rhode Island School of Design. Neither one had any idea of how politics works. Both immediately conceded to the laws and regulations that the San Francisco government put in place. Terrible laws that destroyed two-thirds of all the operating BnB rentals in operation. The anti-business regulations were copied everywhere Airbnb went. The same horrible regulations nearly destroyed similar vacation rental businesses that had been operating for decades, worldwide.
Three lessons from this:
- Americans are deeply disposed to starting businesses; no matter who they are. Its American.
- Government with trivial and irrelevant regulations is the greatest destroyer of business on the planet.
Travis Kalanick, the founder and CEO of Uber, didn’t start his business until he got a Statewide license to run a limousine business which served as a short-term protection against the politically connected and ferocious taxi cab bastards.
3.Political skills are vital to innovation in business. Otherwise governments will destroy you.