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> They’d been funding the company with credit cards. They had a binder full of credit cards they’d maxed out.

In my opinion, this kind of behaviour needs to stop being glorified. 99 out of 100 times this does not end with a billion-dollar company, but rather with someone drowning in personal debt.

The only "acceptable" time you can really run up a literal binder full of credit card debt is when you have a very easy safety-net to fall back in to, which again, does not apply to the large majority of people who would find this "came from nothing" story inspiring.



Exactly. It's a very pure case of survivorship bias. If you go down the route of collecting a folder full of maxed out credit cards your likely future is foodstamps or living on the street, not being a billionaire.


Further, it makes me question how did they get a binder full of maxed out credit cards?

I get that times were different in 2008, but who was giving them all of these cards with no income and a stack of already-maxed-out cards.


Do you remember 2008?

I do. Credit cards weren't hard to get. Even if you were in debt up to your eyeballs. I know because I was, and I could still get new credit cards.

It took a credit management service and ten years of steady payments, but I'm now out of (consumer) debt. Thankfully.

<Edit> Sorry if the above sounded snarky. Being that much in debt still evokes some painful memories.


> Do you remember 2008?

Honestly, I was in high school. So, no, not really. There were other reasons that no one would give me a credit card.

> It took a credit management service and ten years of steady payments, but I'm now out of (consumer) debt. Thankfully.

Wait, you mean the binder full of credit cards didn't work out to a billion-dollar company for you?!? That sucks. I guess we're 1 for 2 on that one today.... 50% chance of success. /s


I had income, and I wasn’t like a million dollars in debt, just $100,000. But I was barely making my mortgage payment and I was getting new credit card applications in the mail every week.


A lot of founders have a well off family that bails them out if they fail. This is something I learned only after my self financed startup failed and left me with debt for more than 10 years.


How do you even get a binder full of credit cards? Isn't the point of credit checks that you can't get a "binder full" to circumvent the credit risk you pose?


3 people, ~12 cards each - that's about a binder of cards, I'd say. If they had good credit to begin with, it would take some time for it to degrade.


Paul does mention the Airbnbs did so because "they had seen the future and couldn't let go."

Sounds to me like it was a calculated risk they needed to take.

Also see Paul's point on how the Airbnbs would have given up incase "this Y Combinator does not work out."




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