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#6 Clip: What To Do When A Crisis Like 9/11 Hits Your Business

#6 Clip: What To Do When A Crisis Like 9/11 Hits Your Business

Released Friday, 18th September 2015
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#6 Clip: What To Do When A Crisis Like 9/11 Hits Your Business

#6 Clip: What To Do When A Crisis Like 9/11 Hits Your Business

#6 Clip: What To Do When A Crisis Like 9/11 Hits Your Business

#6 Clip: What To Do When A Crisis Like 9/11 Hits Your Business

Friday, 18th September 2015
Good episode? Give it some love!
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What do you do when your company is facing a crisis, or as TripAdvisor co-founder/CEO calls it, a "scared sh*tless throw spaghetti at the wall moment?"Some context:His team had been plugging away for about a year and a half and had a functional version of TripAdvisor. Their original plan was to do B2B sales, embedding their travel search engine into major websites. They reached out to all the travel companies, media giants like Yahoo, and were in the early stages of selling their product.Then disaster struck. After 9/11 the travel industry was in shambles. TripAdvisor wasn’t sure if their champions at these companies would even have jobs in the coming days and months. In addition to the terrorist attack, the financial markets had collapsed since the company’s founding and TripAdvisor was on the verge of running out of money.The team had a cool product, but little traction and was on the verge of running out of money. Kaufer offered the investors their money back. They declined, and he resolved to sail to victory or go down with the ship. He asked the team to take pay cuts and gave them more equity. The investors gave him a small bridge of capital to create enough runway to find a business model with promise.The team experimented with banner ads, but quickly realized they lacked the hundreds of millions of page views required to turn that into a thriving business. A Yahoo-inspired directory didn’t pan out. Finally, the team experimented with a cost per acquisition revenue sharing deal with Expedia.The company had a temporary reprieve but needed to find a way to make money. Their strategy changed from B2B to B2C. Expedia was willing to pay TripAdvisor for each referral that turned into a booking—with no limit on the payment. This turned Kaufer’s problem from an abstract one, “how do we make money,” to a more concrete query “How do we get more traffic?”An existential problem became an energizing challenge and the company now has a market cap hovering around $10B dollars.Photo Credit: http://bit.ly/1ObYnbK
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