How Airbnb Turned Itself Into A Data-Driven Company Through Business Intelligence

BI & Analytics as the well of ascension. Image by the author.

Florence Nightingale made the history books of diagrams in 1858 with a publication related to epidemic deaths in the Crimean War. The key idea? Nightingale used a new form of visualization, now named after her, to provide a simple explanation for the causes of deaths and simple policies to prevent them. She succeeded in convincing policymakers and thus saved thousands of lives.

Image from the original publication.

Netflix, Spotify, Airbnb, CapitalOne, and Google are all data businesses. They bring value to their customers with the help of data, lots of value, and lots of data.

While I still believe there is only one good choice to start your journey to becoming a data business, that’s by building smart products; many companies want to start in a different place: by improving decision-making.

Just like Nightingale, they want to turn raw data into meaningful actions with a measurable impact.

Why would you care about boring stuff like decision-making & business intelligence?

In the book Blitzscaling, Reid Hoffman and Chris Yeh talk about how Mark Pincus at Zynga was criticized for having a BI team five times the size of other companies. “Zynga must be dump.” However, collecting that data enabled Zynga to test out ideas and develop games to success at a breathtaking speed.

And all of that is simply by focusing on decision-making.

So this is for you, all those businesses, stubborn or not, that really believe for them the right place to start is with decision-making and are willing to commit to this way.

Let’s explore the story of AirBnb, which started at this point, just like Zynga, focusing on data for decision-making. We’ll try to understand how companies pull this off and what pitfalls you must avoid.

I was wrong about Airbnb

“The price of light is less than the cost of darkness.” — Arthur C. Nielsen