Airbnb ft. Brian Chesky - Battling a copycat clone and rebuilding user trust to revolutionize travel
Sep 7, 2023
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Brian Chesky, CEO of Airbnb, discusses how a crisis shaped his thinking and led to rebuilding trust. The podcast explores moments of battling a copycat clone, navigating a global shutdown, and overcoming challenges. It also highlights the journey of localization and global expansion, strategies used to navigate a crisis, and the surprising IPO performance of Airbnb.
Airbnb's crisis of trust led to a period of soul searching and ultimately shaped the company's thinking and growth into a global behemoth.
Amidst the COVID-19 pandemic, Airbnb successfully rebounded by pivoting its focus to domestic and longer-term stays in non-urban areas.
Deep dives
Building a Novel Approach to Travel
Airbnb was founded in 2008 with a vision to offer a unique travel experience: strangers staying with strangers. Despite initial skepticism, the founders believed that if people could experience the same connection and friendship they felt when hosting their first guests, the idea would spread globally.
Unlocking User Trust
To address trust concerns, Airbnb took inspiration from social networking platforms like Facebook, online payment systems like PayPal, and user review platforms like Yelp. By combining these elements, Airbnb developed a robust system that allowed guests and hosts to build trust through profiles, reviews, messaging, and customer service.
Navigating the Threat of Copycats
When Airbnb's success caught the attention of copycat company Wimdu, the Samwer Brothers sought to out-execute and out-compete Airbnb. Rather than giving in to acquisition offers, Airbnb chose to compete head-on, mobilizing a team of country managers and rapidly expanding its presence in Europe. Despite initial challenges, Airbnb's mission-driven culture ultimately prevailed, and Wimdu capitulated after seven years.
Crisis Amid the COVID-19 Pandemic
The COVID-19 pandemic dealt a severe blow to Airbnb's business, leading to an 80% loss in bookings. To navigate the crisis, Airbnb halted marketing efforts, cut costs, overrode host cancellation policies to refund guests, and raised $2 billion in debt to reimburse hosts. The company quickly pivoted to focus on domestic and longer-term stays in non-urban areas, successfully rebounding and regaining momentum.
As Airbnb took off in the early 2010s, Brian Chesky remembers worrying, “this is just one accident away from being a dead idea.” That accident finally came in 2011 when a host’s apartment was ransacked. It set off a period of soul searching that became a turning point—the company’s efforts to rebuild trust led it to becoming the global behemoth it is today. In this episode, Brian reveals how this crisis shaped his thinking, and how the lessons would apply to the company’s next defining moments, including a pandemic that shut down global travel.
Host: Roelof Botha, Managing Partner of Sequoia Capital