Airbnb's Brian Chesky | Disrupt SF 2014

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our next guest is it's really really cool guy a lot a lot to be proud of for sure I actually rented out my Airbnb in New York to come here so Brian your cut is backstage after the interview please welcome Brian Chesky co-founder of Airbnb and Ryan Lawler our moderator how's it going good thank you for having us here yeah thanks everybody for making it back from lunch Brian had kind of the crazy morning you know you were at the Apple event yeah what did you see there well the first thing I saw was a pretty unbelievable production the place was completely electric and obviously I obviously everyone knows the news the phone which were able to see in person was pretty pretty awesome it's really insane and YouTube played like completely live the very end it was pretty amazing and the other funny thing was they Tim Cook asked everyone like stand up if you're an Apple employee and almost the entire place stood up so it was like this huge house of just Apple employees was pretty cool so how does that work you you just get really cool perks like that because your company is worth like 10 billion dollars I I got invited Joe and I got invited because we're friends with Johnny I've okay so I don't know why other people get invited but we just happen to know him because he's a designer we admire him awesome so so yeah you recently raised a big round of funding yeah your value that about 10 billion is that right last round okay all right so that that puts you around companies like intercontinental high at Windham is that a fair comparison my valuation like that um I yeah I don't think like comparing valuations first of all is like a really important metric I think I've always thought of us as much more of a market place than anything else so I think like a more comparable company to think of us as like a market place like eBay in fact when we launched Airbnb it was originally called air bed-and-breakfast and we entered Y Combinator and like a lot of people now recall the air being the of the uber of and we were not there'd be of anything because there'd be didn't be anything back then and so Paul Graham said you just say either you're the eBay of space because eBay was huge and everyone's got space and so you always kind of thought of ourselves at the eBay of space in the very early days and I'm soon become much more than that but I don't I don't think the valuations are like an important metric and it's funny like when you're a public company no one leads the first sentence of an article with like Google the four hundred billion dollar company but this is an obsession obviously would private companies I just don't think it's the most important thing to focus on but it is it is interesting though that I mean what does it mean for you as a company to be a hospitality company with no actual real assets of your own well the hotels don't actually own most of the assets so almost like the big like Aniston Omer about hotels that they own the hotels most of them actually are in a very similar business to us so I met with a couple executives of hotels and they have to say you know it's funny your model isn't that much different than ours most of the hotel comes like Hilton and Marriott and I actually own their hotels they have people to manage them that people own them and they're basically like a franchisee and in a weird way we're kind of like that too except we're more decentralized okay all right so you're not a hotel we're not a hotel but you were adding a lot of sort of hurts or hosts your you know sort of standardizing what some of these listings will look like and we're giving out you're giving out fire alarms for some hosts you just announced that you're giving out like nest thermostats neighborhood guy stuff like that so what's next I mean what are the other things that you're looking at to help host and make this a better experience for guests yeah so you know what we do today is we provide homes and we actually started by providing rooms all over the world and just to give you a sense of where we are today before I say where we're going our record was about two weeks ago we had about four hundred and twenty thousand people staying at an Airbnb and you know we'll have close to you know million homes around the world and you know we're we we had people staying in that single night from 160 countries so this has gone to massive scale kind of overnight it's been a pretty amazing story and at our core though we're not just about homes for trips we think that people like if you go to Paris you're not going to Paris to stay in a home you're going to Paris cuz you want experience Paris when you go there you need to happen to have a home to sleep in and so we want to be much more of a part of the trip than we are right now so so is that what that's what experiences are yeah people in life who want to have experiences and at the heart of it we want to make sure that every trip that you have on air meet is a great trip now the thing is if you go to Paris you go to New York you go to Tokyo a portion of your trip is in the house and we're not present currently and the rest of your trip and so I think one of the things we're really looking at is how can we become more present throughout the rest of your trip so we can make that trip an amazing experience and it really maps back to what we're really our core purposes and it's the idea that like if we're truly successful you know we're gonna create a world where you can truly bring people together and create a sense of belonging okay but but you have a product which is testing right now called experiences where you're allowing hosts to not just be a host of you know a home or a listing that someone's raised but a host that can be like a city guide right take you on a tour right that's right so that's what you're talking about well yeah that is one of the things we're working on that's that's a bit of experiment we're doing we have a lot of other experiments happening right now kind of all over the world and the idea is that hopefully over time we can start to package these things together to create a much more meaningful experience from when you're traveling okay so what about other value add like pickups at the airport or dry cleaning or you know things that you know not to you know that helping things that like high-end hotels would offer yeah well I think like the hotels are primarily focused on the like in-room experience so they want to do things like room service will be able to do a lot of different things the hotels can do as well but one of the things we're really looking at is also doing things when you're out and about during your trip so I think there will be a lot of things I don't think necessarily will be the one to do everything I think you know we can part with other companies this company's doing something really interesting we'd be happy to partner with them so we make it more seamless for you to have that experience when you're traveling but you know one of the things we did a few years ago is we had to ask ourselves what business are we in are we in the business of homes are we business of space we made a decision a couple years ago we said we're not in the business of homes or space we're in the business of trips that's we're in the business stuff you travel to have a trip not to have a space and so a space is a part of it but we're in the business of trips and we trade this thing that we call snow-white it was basically we storyboard out what the perfect trip would look like we said we're only present right now in a few of these frames we want to give the place where we're present throughout the entire journey and so obviously like dining in homes is one experiment we're doing you know we have tours that's another experiment there's a lot of different things we haven't officially unveiled anything we want to make sure when we launch something it's truly amazing okay why did you roll over at the Attorney General in New York all over well we we got subpoenaed by them in late October October where they asked for data on 15,000 people we challenged them in New York State Supreme Court you put up a fight for over six months very few companies have ever done that actually it doesn't it's it's it doesn't happen very frequently and we initially won the case and then the judge narrowed the subpoena and it was very clear that we weren't gonna win the next case and so we kind of all along realized that we and Attorney General agreed on a few things we agreed that the ordinary New Yorkers is trying to make a living there's totally acceptable behavior we also agree that there were a few bad actors yeah we weren't living by our own standards of enriching cities and so we obviously complied with that subpoena and we had to I was a court order okay but and you shut down those Ho's they were actually shut down long ago most of the people whose data is out now yeah they were shut down like months ago okay but you were happy to you know take money from their bookings for years what what actually changed why are they bad actors now and not before the subpoena was issued right well I mean i I think that like to be honest we didn't understand the scope of activity happening in New York so there were a very narrow group of people in New York that were turning homes into hotels it wasn't obviously not the vast majority of our activity and when this activity was brought to us you know we obviously took action and it kind of evened the marketplace grew so fast for us but you know this was a very very small minority of people okay but you still handed that user data over to the Attorney General yeah isn't that kind of like throwing your users on it under the bus I don't think so I mean honestly we've protected the vast majority of people in New York we put up a fight for almost nine months in New York state Supreme Court and you know you know we fight to the very end until the end of a subpoena okay does this set a precedent for other markets like won't regulators or government agencies you know in other places say well you did this for New York you shut down these listings you gave over user data so that we could you know go after them for running illegal hotels can't any city just say that now well we're actually already in discussions with dozens of cities and we're been in discussion with Portland and cities all over the country and actually all over Europe to work on integrations around making sure that you know we have ways to comply with taxes like we did in Portland and so you know when cities give us subpoenas well of course well of course you know comply with them as long as they're not overly broad you know we always have to comply with subpoenas at the very narrow any company would but you know the ultimate thing we want to do is we want to be able to enrich cities that we serve and so we're in 34,000 cities and so we're now in discussions with dozens of cities not in every city but dozens of cities with city regulators I've met numerous like kind of policy makers supervisors in cities and the idea is how can we work together to enrich cities and this Paulette this thing we put is program we put out is this thing we call shared city and we announced this in Portland and it's an integration between us in Portland and we did a number of things the first thing we do is we provided you know three smoke detectors with carbon monoxide filters in homes in Portland we provided you know we're promoting Portland is a destination and so there's a bunch of things were doing we're doing this city by city around the world okay earlier today on Kim's panel David Chiu is here and he talked about the legislation he's putting forward for San Francisco now that would create a legal framework for Airbnb right now but it would also mean taking down the same types of listings where you know a small percentage of users have a large number of listings yeah right why don't you just do that everywhere you obviously know who these hosts are that are running these hotel operations and you know that's going to be a problem in every market that you're in why wait why wait for the order to come down from a regulator yeah well it's not actually a problem in every market there are a lot of cities throughout Europe and around the world where they are very happy to have types of business where people are managing multiple units but we've actually been taking down lots of multiple dwellings all over cities around the world and the notion that there's a lot of these people in San Francisco is just false we don't have a lot of that activity here okay I mean there was a study several months ago that said they're about 500 hosts that together had 1,500 listings post with multiple listings so these people exist yeah I don't I don't I don't know about that today I think there was a sample Chronicle study I'm not sure about that data but the vast majority people in San Francisco are ordinary people running out to primary dwellings we don't have that many people renting multiple units and the other thing is the number of times people are renting homes on behalf of other people who actually live in that home and so a number of cities that's totally fine so in other words if I'm away someone else can use my account to manage my listing for me while I'm gone a lot of cities say it's completely acceptable behavior and these people are getting thrown in with these property managers who aren't the same kind of business so the idea is gotta be a little more nuanced city by city but we're already partnering with cities I mean we're complying with San Francisco complying with Portland and we're working city by city all over the world you kind of got to do it on a case-by-case basis you don't want to have a blanket kind of policy because you know unless it's something that every city in the world so what kind of lesson has this been for you in politics well it's been an overall lesson for me in managing a marketplace I've learned a couple things the first thing I've learned is just generally in politics so much comes down to understanding people have an opinion about you and it's based on what they understand and sometimes their opinions based on the people who have gone to them and so if you reach out to a politician to educate them you get to know them you may be on a good basis if you wait for them to like kind of hear from other constituents and you're really slow in education then you start in a really bad place so that's been a good lesson for me like the hotel lobby that you're not competing with the hotel lobby oh yeah well I mean we have good relationships now with the hotel industry and there are some people that weren't super happy with us but the other thing I learned was just generally its principles about managing a marketplace so we started Airbnb I took the kind of Craig Newmark approach to managing the marketplace Craig Newmark's the founder of Craigslist and he thought you know marketplaces for classified sites were kind of like immune systems they had communities and the communities would pause police and moderate itself and so we thought you know our community fundamentally is an immune system and if bad experience are happening you know that's not a terrible thing because ultimately a community will moderate and remove them over time what I've learned is that you know that's you know a bit unrealistic like we need to be much more proactive so over time we've gotten much proactive whether it's on trust and safety removing bad actors providing insurance for people being more proactive or regulators so these are things that you start to learn you get more proactive over time okay and that was a pretty good lesson okay so I'm going to put something up on the screen yeah this thing what body part does that look like to you I think it's an ear it's I guess I guess it's whatever you whatever you're thinking about a lot of people have very dirty minds then yeah but but seriously so we don't need it anymore we all know that what this looks like you you partnered with design studio on yeah how many people were part of that process and how long did it go as far as design process yeah oh I mean we had quite a few people we had dozens of people I know where you're going what did anyone bring this up and yeah of course and yeah some people had brought it up and ultimately you know I just we just fell in love with this symbol and it wasn't the first thing we saw I think you know people obviously have quite dirty minds I mean I think what we really wanted to do was you know we wanted our brand to become a universal symbol for something that's very important to us and the thing that's important to us much more than rooms are homes is this idea of belonging and so we wanted to come up with a universal symbol belonging and I love this symbol so much because I think it represents like kind of love upside down like a heart embracing and obviously people can see other things with it but I think one thing we were trying to do was get people to forget the old logo and I think if there was ever a way to get people to forget the old logo it's something like this and so we obviously it took the world by the media by storm not in maybe a completely the way we anticipated it but we got people talking about it and really happy the work that team did so all press is good press on this I think on this case all press is good press for sure and yeah I think it's been quite a you know the other thing is that like the one one other thing I told the team as I said don't worry about like agitating a little bit in social media and the press like if you put out something and the whole world doesn't love it that's okay most the worst thing in the world is putting something out and no one caring no one ever paying attention to you that'd be a hawk or just just awful it just means you're irrelevant so we want to become part of this kind of social conversation a bit of pot hard part of pop culture and I think for that week that we launched us we were okay so I was looking at your investor list and you really have like everyone you've got Sequoia a founder respond andreessen horowitz crunch founds who's been the most helpful we've had some I mean it's hard to pick one person they've so many of them is so helpful I would say a few that come to mind I mean obviously Alfred Lin is on our board and chef Jourdan on my board the two board members were amazing Ron Conway has been utterly unbelievable to us and he's been really great you know Marc Andreessen has been super helpful Reed Hoffman also and then Paul Graham and Jessica Livingston from Y Combinator so it's hard to really pick any one person basically everyone has been I'd say just about everyone I like the one thing I said is like when we brought investors in I kind of viewed them as as partners like co-founders you know you can't fire an investor so you got to make sure you can live with them and so I thought if we're gonna have some investors they got to be people that we really really want love and so every single round we did the first thing is we never picked the highest price so every single round we could have gone a higher price we end up picking the partner that was best for us and we wanted somebody that we could have a really good relationship with and until the last round where we did get some mutual funds in we had this really interesting trend where every single person who ever invested in us had started or run a company and this is like true of about a dozen people and this is pretty unusual and the reason was we wanted people that actually add value and so I've been pretty shameless about that just pinging them they'll they'll all know that I kind of bother them a lot for help so they've been really great can you give me an example like what's the type of thing that you bother someone for Marc Andreessen one example TechCrunch obviously mid-2011 we had the apartment thrashing incident and Marc Andreessen called me and I wasn't exactly sure like how to deal with it and obviously we need to have a response but the response had to have some dramatic action behind it I couldn't just apologize and say I'm sorry this happened there need to be something substantial behind it and the thing we came up with was this thing called the Airbnb guarantee which we have today and at the time we were gonna do a $5,000 guarantee and this is the night before we're about to announce it and Marc Andreessen comes to my office at midnight and I'm showing him the blog post and this is the like the apology post I put out I know TechCrunch put out he takes the posts and he adds two things the first thing he takes cuz he takes the $5,000 guarantee he adds a zero at the end that make that 50,000 then he told me add my personal email to it which I did and at the time the $50,000 gainer teeth seemed coldly crazy I mean we had no because we basically gave people 30 days and we want to restore confidence if there's been any problem in 30 days tell me what's happened and we had pretty flexible policy back then and for all I knew would have used the entire around to pay for the policy and so having an investor give me confidence that we should do something that traumatic to restore confidence it was really really great so that's just like one example okay I'm glad you brought that up because you know we all know about the you know the trash meth house and all that but over the last six months you know you've had you've had stories about sex parties and squatters and listings with you know 22 beds stacked up against each other in one house I mean are we just sort of immune to this now is it just that you're so big that we don't we don't care quite as much when these things happen well I mean I think the first thing you do is put this put these incidents in perspective when you have 400,000 people a night it's a size of a small city so if you were to imagine like presiding over city and you imagine imagine a city of four in 2000 all the things happening in that city there'd be a lot of crazy stuff happening I think the vast majority of what's happening everybody is good and it's the reason why is because there's no anonymity in the platform so there are incidents but I think if you look at us as a percentage they're going down dramatically and they're not very common is there more that you can do sort of I think there's oh absolutely there's always more we can do and every time something like happens it's just really like it's pretty outrageous like these stories were outrageous I think there's continually more we're gonna do and I'm the trust and safety idea like run we want to go even further than where it's already gone you know when we start Airbnb there was no insurance we didn't verify people's identities you can be totally anonymous and you can book an experience now all that's turned on its head and over time we want to do is provide even more authenticated identity so over time eventually we want everyone to be vetted and verified on Airbnb and we vet and verify everyone in a way but we want to just go deeper and deeper on it all right a few days ago maybe a week ago something like that you you announced a conference you have this Airbnb Oh in conference I can kind of understand you know when like box or Salesforce or you know some company that has like a developer ecosystem a having a conference but this is just for host yeah why is it important for you to to do that yeah as a business so about a third of our hosts depend on Airbnb has a job and two-thirds depend on it to pay their rent or mortgage so everybody's really really important and one of the things our hosts tell us is they say Airbnb we think of you as partners and so we really are partners with them right our customer is not the host our customers the guests and we're partnering with the host to provide experience for the guests so any company that has partners they'll often bring them together right and so that's as a box does and so we think just like eBay had eBay live we have this event that we're gonna be doing it's just a way to bring our hosts together to make them feel like partners and this is something they've been requesting for a number of years we're starting really small the first year though I think we'll only have about a thousand hosts which is not a very big event given that we're gonna have obviously over a million homes around the world are these hosts like people who are just like paying to be a part of it or are you inviting them like what's what's the process we are inviting them and we're inviting them starting with our very top host I don't think they're they're not paying I mean they'll pay their way but they want to get a ticket to go in and they're just generally people I would assume that are very very passionate about the Airbnb community they're like super hosts people who care deeply about this idea of hosting they love hospitality and you know one of the things I would love for us to do is become the largest educator of hospitality and the planet so you know at the end of day what we provide is hospitality you know we are really a hospitality company in that in that sense of the word we're not a hotel company but we are a hospitality company we're welcoming people into our homes that's what we're doing when we host on Airbnb and so we want to be an educator of hospitality in this event is gonna be really focused on providing education about how to be a better host and our host really excited about this all right and part of that started with you hired this guy chip common yeah so chip Conley is the founder of Jaffe hotel group they started the hotel betal and the hotel Phoenix around here and he's been amazing you know when we started Airbnb I definitely not think we're hospitality company so that's what hotels do as I learned about hospitality I realized house he's really just providing service with heart and what we do at Airbnb is this exact thing but the difference between us and really every other like hotel company is that we aren't really like a mass-produced thing we are an economy that's powered by people and everyone is people are providing hospitality and they're not mass-produced and part of the concept we did the brand launch was we wanted every single person have their own mark their own identity and I think this leads to where I see a lot of Commerce going in the future whether it's us lyft uber and a lot of these companies I think in the future the economy is going to increase them become a powered by people more and more people have power the economy to be able to produce and create things and the reason this will happen is because they'll have reputations and this is one of the things what they're doing ok so I see that yeah and it's an obvious trend but is it is it a good trend is the $10.99 economy good for the world good you have record underemployment it's a Great Depression most the people that worked on air beam that are hosting an Airbnb didn't have an income before I think anybody that unlocks a lot of inventory in the world allows them to monetize the most expensive asset that they can create it's great and I think the $10.99 world that's like saying it's a hobby well a lot of hobbies can stay as hobbies in the future people may have multiple income streams but then more and more people can decide to become professional we're seeing this probably worth ride-sharing with lyft and uber and I think that's actually a great thing for the world ok well we're out of time that thing's flashing at me so thanks for being you very much Ryan
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Channel: TechCrunch
Views: 26,686
Rating: 4.7183099 out of 5
Keywords: brian chesky, Ryan Lawler, airbnb, Techcrunch Disrupt SF 2014, Disrupt SF 2014, TC Disrupt SF, Techcrunch Disrupt SF, Techcrunch Disrupt, TC Disrupt, Techcrunch
Id: ffhEIDXkJDM
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Length: 25min 55sec (1555 seconds)
Published: Tue Sep 09 2014
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