One thing Brian Chesky would never have expected in his life was to become Silicon Valley’s child prodigy, and to be considered the father of a new economic model, precisely sharing economy, economy based on sharing. He is the co-founder, along with his university colleague Joe Gebbia, of Airbnb, the website where anybody can rent a bed, a room or an entire house. Highly appreciated by travellers for its convenient prices, and by tenants as it provides an easy way of making some extra money, it is the nemesis of hoteliers who suddenly witnessed this radical change in the hospitality market.
And yet, this designer who moved to San Francisco from Rhode Island without any technological competence was, initially, a mere outsider in the valley of innovation.
I was so naive that when I first heard the term “angel investor”, I thought “Surely, this guy doesn’t believe in angels!".
«Everybody sought the Zuckerberg model. If you had not quit an undergraduate degree course at Harvard or Stanford, they thought you would never create the next Google or Facebook», said Chesky. «Moreover, we were not engineers but designers, and we knew nothing about running a company… I was so naive that the first time I heard the word “angel investor”, I thought, “Surely, this guy doesn’t believe in angels!”».
There have been considerable changes since then. Since 2008 Airbnb has obtained over 3 billion dollars from venture capital funds and Chesky, born in 1981, the son of social workers, a degree in industrial design and a deep passion for creativity, has made remarkable progress. He too has become an investor, funding other projects in the line of sharing economy, ranging from Uber to Balanced, the peer-to-peer car-sharing company .
But if Airbnb is worth 31 billion dollars today, it was established by exploiting an idea conceived when its founders experienced financial difficulties a few years ago.
«Joe and I shared a flat in San Francisco, but we had some difficulty paying the rent. All hotels were fully booked on the weekend of the International Design Conference. Joe had three inflatable air mattresses. We pulled them out of the wardrobe and rented them out. We called it“Air Bed and Breakfast”», says Chesky, relating the mythical parable of sharing economy. Everything commenced with a very simple idea, precisely that of sharing spaces, assets and skills to find a solution to limited resources.
«The reason why the idea developed so rapidly is that, unlike conventional companies, we did not have to build anything. The infrastructures were already present. All we needed was The Internet». However, it was not so easy. «We started in 2007, one year after the crisis that disrupted the market. An investor told us, “Listen, the stock exchange is crashing. I cannot even invest in good companies, why should I invest in air mattresses?».
And if today, nine years and 150 million users later, that investor is probably regretting his decision, he is not the only one to have slammed the door in the face of one of the most profitable startups in the past twenty years.
«At first nobody wanted to provide funds. They thought that our idea was crazy, that people would never accept the hospitality of strangers», said Chesky. «We had debts for thousands of dollars on our credit cards. Many asked us why we did not quit before that. The reason is very simple, if you open a company you must know something about your business that nobody else does. We knew that there was nothing strange in sharing lodgings with strangers. We had tried it, and that was our compass. We were genuinely convinced about what we were doing».
We are looking for talent in deep learning at Airbnb, ping me if interested
— Brian Chesky (@bchesky) March 7, 2017
The future lies in human relations
According to Chesky, Airbnb’s success was decreed by the very factor that everybody considered most critical, namely the possibility of interacting with strangers.
«The opportunity to have relational exchanges is increasingly rare in this world where we are all so disconnected», he said, explaining that Airbnb actually meets the most natural human need to meet up with other people. «Our company is grounded on the most personal human interaction; precisely to be a guest in somebody’s house, sleep in their beds, and use their bathrooms». Putting it in a nutshell, the dad of sharing economy says that people are the key, and his experience confirmed this.
If what made the difference for Airbnb was its access to Y Combinator, Silicon Valley’s leading corporate accelerator, a blender of consultants, investors and mentors from the elite American hi-tech industry, Chesky, instead, attributes his growth as entrepreneur to meetings with more expert “colleagues” than himself.
«I had to learn everything very rapidly, and I understood that, if I wanted to reach the core of the matter, I had to go directly to the source, which meant investing energy to meet the best in those fields and to learn from them». Leading figures became more accessible as the company developed.
«I have never been bashful when it comes to establishing contact with people who are more intelligent than me, people who have more experience. As I became more successful, I increased my attempts to meet leaders in the sector, ranging from investors to Sheryl Sandberg of Facebook. I had the opportunity to meet Warren Buffett, who became my mentor. Somebody once said, "You are the mean of the five people that surround you"; hence, the question is, "How mature are the people who surround you?". If you are surrounded by the right people, you can grow very rapidly». Chesky has a habit of making a note of lessons and advice imparted by the best, and sharing them with his employees in a true spirit of sharing. His “Sunday night series”, the Sunday evening e-mail in which he tells everybody a principle or an important lesson he has learnt, is now a tradition for those who work at Airbnb.
«I have never been bashful when it comes to establishing contact with people who are more intelligent than me, people who have more experience».
Corporate culture is everything
Chesky learnt his most important lesson on leadership from Sheryl Sandberg, famous Chief Operating Officer of Facebook: «From the time you become a CEO, people stop telling you how things are actually. Ask the right questions and don’t give up until you obtain the answers you are seeking».
Instead, to promote corporate communication and transparency, Chesky contacted, no need to say, the greatest expert in secrecy in the world, George Tenet former CIA Director (from 1997 to 2004), and today Managing Director of the investment bank Allen & Company. What advice did he give? «Be visible, eat daily at the corporate café, always sitting at a different table, and talk to everybody».
Indeed, as in all the coolest companies (and the most profitable ones) of Silicon Valley, transparency and communication are the pillars of corporate culture, which Airbnb deems the most precious factor, as mentioned by Peter Thiel, co-founder of PayPal and the investment guru, who has invested 150 million dollars in Airbnb.
«The only advice he gave me was the following, ‘Do not throw corporate culture out of the window. If you do that, you break the machine that creates your product’».
And, once again, the key are people. «Strengthen the culture, and you will need less corporate processes. You can rely on the fact that each one will do the right thing. The entrepreneurial spirit is encouraged among employees. And if our company is driven by an entrepreneurial spirit, then we shall be able to take our next step into the future».
A company's culture is the foundation for future innovation. An entrepreneurs job is to build the foundation.
— Brian Chesky (@bchesky) September 4, 2012
Airbnb’s CEO firmly believes that motivating employees is the first step. «Companies that recruit people who have a deep passion for their work convey this enthusiasm to their clients too, and thus have very very strong brands». Those who work here are pampered with benefits, so much so that in 2016 Airbnb was appointed “Best Place to work” in Glassdoor’s charts, but he is also encouraged to continuously test his skills.
Chesky weekly meets new recruits during a Q&A session to encourage them to risk and be a little crazy, repeating the motivational mantra that has become his brand, namely «You are here to design the future you want to live in».
When I meet new hires @ Airbnb, I tell them to never assume they can't do something. https://t.co/Xprolfab5C
— Brian Chesky (@bchesky) February 26, 2017
People increasingly seek and want to discover the other. Indeed, objects and destinations have no power to transform you. What really transforms you is meeting people.
In the future people will travel to feel less lonely
Human relations are actually the key to everything according to Mr. Airbnb, from employee management to the success of his business model and the future of the tourist market.
«Everybody says that you cannot trust strangers but I believe that with Airbnb we have denied this belief», said Chesky. «Instead, we have shown that people are basically good». And Chesky has very clear ideas about the near future, «Actually, the main attraction for the traveller will not be the places anymore but increasingly the people he or she can meet».
Hence, the platform has recently launched the section Experiences, in which natives of the place offer alternative tours. In Havana, for instance, the singer Meiby acts as guide to the city’s musical scene, while in Toshima-Ku, Showzi, master of Japanese ceramic art, offers lessons to tourists.
People increasingly seek and want to discover the other. Indeed, objects and destinations have no power to transform you. What really transforms you is meeting people». Once again the future will be built on human relations.