Airbnb

Klarna

Airbnb

Airbnb is a two-sided marketplace. Hosts list their homes, apartments, treehouses, or whatever else they've got.

Guests book and pay through the platform. Airbnb takes a cut from both sides — roughly 3% from hosts and up to 14% from guests as a service fee.

That's it. They don't own a single property.

They just built the world's largest hotel chain without owning a single bed.

Klarna

Klarna makes money from merchant fees and consumer interest. Merchants pay Klarna 3-6% of each transaction — they're willing to pay because Klarna increases conversion rates by 30%+ and average order values by 45%.

On "Pay in 4" (interest-free installments), Klarna makes money purely from merchant fees. On longer financing (6-36 months), Klarna charges consumers interest up to 25% APR.

Klarna also earns revenue from its shopping app (affiliate commissions when users discover and buy from merchants), and from its Klarna Card.

Airbnb

In 2007, Brian Chesky and Joe Gebbia were two Rhode Island School of Design grads living in San Francisco and struggling to make rent. A big design conference was coming to town and every hotel was booked solid.

They bought three air mattresses, put up a simple website called AirBed & Breakfast, and charged $80 a night including a homemade breakfast. Three strangers actually showed up.

That was it — the entire origin story of a $75 billion company is three air mattresses and desperation.

They recruited Nathan Blecharczyk, a Harvard-trained engineer Joe knew, to build the real website. But nobody wanted to fund them.

They applied to 15 investors and got rejected by every single one. To keep the company alive during the 2008 election, they designed limited-edition cereal boxes — Obama O's and Cap'n McCain's — and hand-assembled 500 of each.

They sold the Obama O's for $40 a box and made $30,000. That cereal money literally kept Airbnb from dying.

Paul Graham at Y Combinator finally let them into the Winter 2009 batch — reportedly because the cereal stunt proved they were "cockroaches" who would never die. YC invested $20,000.

Within a few months, Sequoia Capital led a $600,000 seed round. The rest is history.

Klarna

Sebastian Siemiatkowski, Niklas Adalberth, and Victor Jacobsson were students at the Stockholm School of Economics. In 2005, they entered a startup competition with an idea: let people buy things online and pay later.

At the time, online shopping was still new and most people were terrified of entering their credit card details on the internet. The idea was simple — Klarna would pay the merchant immediately, and the customer would get an invoice with 14-30 days to pay.

The competition judges hated it. The idea was dismissed as financially irresponsible and the team didn't win.

But Siemiatkowski pressed on. Swedish e-commerce was growing fast and merchants were desperate for any way to reduce cart abandonment.

Klarna's "pay after delivery" model was a hit because it shifted the risk — customers could receive the product, try it on, and only pay for what they kept.

The first customers were Swedish e-commerce merchants selling fashion and home goods. Klarna handled the invoicing, fraud detection, and collections.

Merchants saw conversion rates jump because customers were more willing to buy when they didn't have to pay immediately.

Airbnb

The early growth was pure hustle. Chesky and Gebbia flew to New York — their biggest market — and went door to door visiting hosts.

They noticed the listings with bad photos got no bookings. So they offered free professional photography to every host.

Bookings exploded. That single move — better photos — was probably worth more than any ad campaign they ever ran.

They also pulled one of the most legendary growth hacks in startup history. They reverse-engineered Craigslist's posting system so that Airbnb hosts could cross-post their listings to Craigslist with one click.

Craigslist had millions of people looking for rentals. Airbnb had none.

The hack funneled Craigslist's traffic straight into Airbnb. It was borderline shady and absolutely brilliant.

Word of mouth did the rest. Every guest who had a great stay told their friends.

Every host who made easy money told their neighbors. The product sold itself because both sides benefited immediately.

By 2015, Airbnb had more listings than the top five hotel chains combined.

Klarna

Klarna grew by being embedded at checkout. The strategy was to sign up the biggest online retailers and become a payment option alongside Visa and PayPal.

Once Klarna was at checkout, consumers discovered it organically. The "Pay in 4" button became ubiquitous across fashion, electronics, and home goods retailers.

The Klarna app became a growth engine beyond checkout. By building a shopping app where users could browse products, discover deals, and track deliveries, Klarna turned from a payment method into a shopping destination.

The app has 35+ million monthly active users who start their shopping journey inside Klarna before even visiting a retailer.

International expansion was aggressive. Starting in Sweden, Klarna rolled out across Europe, then into the US, UK, and Australia.

The US became the biggest growth market — American consumers were especially receptive to Pay in 4 as an alternative to credit cards. By 2023, Klarna had 34 million US users.

Airbnb

Regulation. Full stop.

Cities around the world have gone to war with Airbnb. New York, Barcelona, Amsterdam, Paris, Berlin — all have passed laws restricting or outright banning short-term rentals.

The hotel lobby has spent hundreds of millions fighting Airbnb at every level of government. In New York City, a 2023 law essentially banned most Airbnb listings overnight.

Then COVID hit. In March 2020, Airbnb's business dropped 80% in eight weeks.

Chesky had to lay off 1,900 employees — 25% of the company — in a single memo that became famous for how honest it was. He gave everyone 14 weeks of severance and a year of health insurance.

The company burned through its IPO plans and took on $2 billion in emergency debt at brutal interest rates.

But here's the thing — COVID also saved them. People stopped wanting hotel lobbies and started wanting isolated cabins and rural homes.

Airbnb's bookings came roaring back by summer 2020, and the rural/unique stays trend became permanent. They IPO'd in December 2020 at a valuation that stunned everyone.

Klarna

The valuation collapse was humiliating. Klarna raised at a $46 billion valuation from SoftBank in 2021.

One year later, they raised a down round at $6.7 billion — an 85% haircut. It was the most dramatic valuation drop in fintech history.

Employee stock options were underwater. Siemiatkowski had to lay off 10% of the workforce.

The entire BNPL category went from hot to radioactive in months.

Credit losses are the existential risk. Klarna is lending money to consumers who want to buy things they can't afford to pay for right now.

When the economy slows, defaults rise. Klarna's credit losses hit $1 billion in 2022.

The company had to tighten underwriting significantly and pull back from riskier markets. The tension between growth (approve more loans) and profitability (reject risky borrowers) defines every quarter.

The IPO in 2025 was a comeback story but with caveats. Klarna went public at $15 billion — a major recovery from the $6.7 billion trough but still less than a third of its 2021 peak.

The company finally turned profitable by slashing costs with AI (replacing hundreds of customer service agents with AI chatbots) and tightening credit standards. But investors remain cautious about the BNPL model's long-term sustainability.

Airbnb

Airbnb Stays is the core product — book someone's home instead of a hotel. Airbnb Experiences lets you book local activities run by hosts, like cooking classes in Rome or surf lessons in Bali.

Airbnb Plus is a collection of verified, high-quality homes that have been inspected in person. Airbnb Luxe is the ultra-premium tier — think private islands, castles, and villas with dedicated concierge service.

Categories (launched 2022) lets you browse by vibe — treehouses, lakefront, tiny homes, mansions — instead of just searching by location.

Klarna

Pay in 4 is the signature product — split any purchase into four interest-free payments over six weeks. Pay in 30 lets customers receive the product first and pay within 30 days.

Financing offers longer-term payment plans with interest for larger purchases. The Klarna App is a shopping destination — browse deals, track orders, manage payments, and earn cashback.

The Klarna Card is a physical Visa card that lets users Pay in 4 anywhere. Klarna Creator is a platform for influencers to earn commissions sharing products.

Klarna AI is their customer service chatbot that handles two-thirds of support queries.

Airbnb

Y Combinator, Sequoia Capital, Andreessen Horowitz, Greylock Partners, Founders Fund, General Atlantic, Jeff Bezos (personal investment)

Klarna

Sequoia Capital, SoftBank, Silver Lake, GIC, Atomico, Commonwealth Bank of Australia, Heartland