Cereal Entrepreneurship: Inspiration for Investing in Your Crazy Idea
Updated: Apr 27, 2021
Brian Chesky is a cereal entrepreneur.
If you read that line again, I can’t blame you. But no, that’s not a typo.
He’s a cereal entrepreneur.
When he and his friends noticed the shortage of hotel rooms during a conference in his hometown, the cash-strapped Chesky pitched an idea: they could charge somebody for sleeping on an air mattress at their apartment. Their guest would be relieved to have a place to stay, and the friends could make a little money by helping someone in need.
The idea worked, and with its success, another idea was planted in Chesky’s brain: could he scale-up and offer this service for more than his apartment?
THE EARLY DAYS OF A CRAZY IDEA
Working with his roommates, Chesky devised a service for people to list their homes and invite strangers to stay the night with them for a fee. They called it AirBed and Breakfast, and they began pitching the idea to any venture capitalists that would give them the time of day.
Over and over, Chesky was told that there was nothing sustainable about his idea. It was too dangerous. To stupid. Too many risk factors with complete strangers being invited into people’s homes.
One VC left his food behind mid-meeting, roaming off and never to return.
It became apparent that if he was going to fund the project, Chesky and his friends were going to have to do it on thier own.
That’s exactly what they did.
“You know those binders that you put baseball cards in? We had one of those, too, but it was full of credit cards,” Chesky later joked about what he called the Visa funding round.
After retooling the name of their startup, the AirBnB co-founders maxed out credit card and credit card to invest in their idea.
SO WHAT IS A CEREAL ENTREPRENEUR, ANYWAY?
The homerun of the start-up funding came with cereal.
The co-founders, by this point, were desperate, but they also weren’t ready to throw in
the towel just yet. To generate funds, they had custom cereal boxes printed during the 2008 Democratic National Convention and sold limited-edition boxes of “Obama O’s” and “Captain McCain.”
To achieve this, they hand-glued the 1,000 cereal boxes they had printed by a mutual friend, filled them with repurposed cereal from several trips of buying out grocery stores, and then sold their homemade boxes for $40 a box at the convention.
One thing led to another and the idea that began as a desperate move for quick cash landed them a feature on national television. They sold out in 24 hours, profiting $30,000 in cash.
MORE THAN CASH: THE VALUE OF CEREAL ENTREPRENEURSHIP
The cash was a great sparkplug for AirBnb to get off the ground, but the biggest win from the cereal came with Paul Graham, a famous venture capitalist, who agreed to meet with Chesky and his friends.
According to Chesky, the interview wasn’t off to a good start, until, as they were leaving, he gave Graham a box of cereal and explained the story behind it.
In that box of cereal, Graham saw three men who weren’t afraid to roll up their sleeves and do anything they could realize their crazy idea. He invested in AirBnb on the spot, and that is what truly got the ball rolling for a company that now has a market cap over $100 billion after its recent IPO.
In the early days, one VC told Chesky that AirBnb was “the worst idea ever.” Now he affectionately refers to it as “the worst idea to ever work.” It didn’t work because of sheer luck, though. It worked because the grit and effort Chesky put into his idea.
It worked because cereal entrepreneurship.
CEREAL ENTREPRENEURSHIP IN YOUR LIFE:
Maybe you don’t want to be a billionaire. Maybe you’re not trying to become a Fortune 100 CEO.
That’s okay. Neither of those things are on my bucket list, for sure!
But I do try to remember the story of Brian Chesky, the cereal entrepreneur, and how he wasn’t afraid to roll up his sleeves and invest in his idea. Chesky was willing to make AirBnb happen at any cost, and the hard work led him to living out his dream.
Sometimes achieving the future we see for our best-selves is scary. Sometimes we have to take risks.
For me, starting Content Ninja was a risk. There's no consistent paycheck like a corporate setting provides and there's no benefits.
Was that a good idea to embrace my own business idea rather than taking an office job? Who knows? Not me. Not yet. But I do know this: I’d rather fail trying to do something I’ve always dreamed of than spend 40 hours a week doing something that’s just a job.
I know I’m willing to roll up my sleeves and do anything I can to achieve my dream. I know I will strive to be a cereal entrepreneur.
What’s your dream? Whatever it is, I challenge you to be inspired by Chesky—just as I am—and together we can make our dreams come true.