Blog Post ⋅ 20151130-brianchesky-greylock

The Airbnb Story: From Air Mattresses to a Global Phenomenon

Brian Chesky, CEO and co-founder of Airbnb, recently sat down to share the story of his company’s incredible journey from its humble beginnings to becoming a global giant. The talk provided fascinating insights into the entrepreneurial mindset, the importance of design thinking, and the unique challenges of building a company that redefines the travel experience.

The Worst Idea That Ever Worked

Airbnb, the platform that allows individuals to rent out their homes or rooms to travelers, was initially met with widespread skepticism. Chesky recounts how many dismissed it as the “worst idea that ever worked.”

No Money, No Beds, No Problem: The idea for Airbnb was born out of necessity. Chesky and his co-founder Joe Gebbia, both recent art school graduates, were struggling to make rent in San Francisco. With an international design conference coming to town and hotels fully booked, they saw an opportunity to offer a cheap alternative: air mattresses on their living room floor. This unconventional solution, dubbed the “Air Bed and Breakfast,” attracted three guests from different corners of the world.
The Power of Shared Experiences: What started as a desperate attempt to pay rent quickly evolved into something more profound. Chesky observed that the shared living experience fostered immediate and meaningful connections between strangers, forging friendships within days. This realization was the spark that ignited Airbnb’s mission: to create a world where anyone can belong anywhere.
From Conferences to Global Community: The initial focus on offering accommodation for conference attendees soon broadened to encompass all types of travel. Chesky recognized that people craved authentic travel experiences and a sense of belonging in unfamiliar cities. This led to the development of the Airbnb platform we know today, connecting travelers with hosts offering unique and personal accommodation options worldwide.

The Art of Obsession and Design Thinking

Chesky’s background in design had a profound impact on Airbnb’s approach to building the company and its culture. He emphasizes that “design isn’t how something looks, it’s how something works.” This philosophy permeates every aspect of the company, from product development to office design.

The Seven-Star Design Principle: Chesky introduced the concept of seven-star design, a framework for exceeding customer expectations at every touchpoint. It involves imagining an ideal customer experience and then pushing beyond the expected five-star level to deliver moments of delight and surprise. This approach, applied to various aspects of the Airbnb experience, from airport pickups to the check-in process, helps cultivate a passionate customer base who love the product and eagerly share it with others.
Creating a Culture of Belonging: Chesky believed that a strong company culture, rooted in the company’s mission, was essential for success. He went to great lengths to instill a sense of shared purpose and passion within the company. This included:
- Designing an office space that reflected the company’s values: Meeting rooms were transformed into replicas of popular Airbnb listings, immersing employees in the world they were building.
- Personally interviewing the first few hundred employees: This meticulous process ensured that every new hire was a cultural fit, deeply passionate about the company’s mission.
- Living and breathing the product: Chesky spent nearly a year living in different Airbnb listings, gaining valuable insights into the customer experience and demonstrating his commitment to the company’s core value.

Scaling the Unscalable: From Ramen Profitability to Global Domination

Chesky highlights the crucial lesson learned during Airbnb’s scaling phase: what got you here is not what will get you there. The company had to adapt its strategies, processes, and mindset to navigate the challenges of rapid growth and intense competition.

The Power of Hustle and Adaptability: Faced with financial constraints and an uncertain future, Chesky and his co-founders relied on their unwavering conviction and ability to adapt. They launched, re-launched, and pivoted until they found a product-market fit.
Building a Company, Not Just a Product: As Airbnb scaled, Chesky’s focus shifted from building the product to building the company that builds the product. This involved:
- Mastering the art of hiring and management: Recognizing his limited experience in these areas, Chesky actively sought advice from mentors and industry veterans. He learned the importance of surrounding himself with talented individuals and empowering them to excel.
- Moving from intuition to data-informed decision making: While early product development relied heavily on intuition and personal experiences, scaling required a more data-driven approach. Chesky embraced A/B testing, cohorting, and other techniques to optimize the platform and inform strategic decisions.

Overcoming Existential Threats: Battling Clones and Government Regulation

As Airbnb gained traction, it faced two significant existential threats: fierce competition from copycat companies and legal challenges from government regulators. Chesky’s approach to overcoming these obstacles was unconventional and insightful.

Fighting the “Attack of the Clones”: When a notorious clone company, backed by substantial funding, threatened to dominate the European market, Chesky received conflicting advice. While some encouraged him to sell the company, others urged him to fight for his vision. Ultimately, he heeded the advice of Mark Zuckerberg: “Whoever has the best product wins.” Airbnb doubled down on building a strong community, focusing on customer experience, and establishing itself as the leader in the space.
Winning Hearts and Minds: Facing legal challenges from the New York State Attorney General, Chesky adopted a “kill them with kindness” strategy. Rather than engaging in a public battle, he focused on building relationships with city officials, demonstrating Airbnb’s commitment to being a responsible partner and promoting the positive impact of the platform on local communities.

The Journey of an Infinite Learner

Throughout his talk, Chesky emphasizes the importance of continuous learning and adaptability. He shares valuable insights into his own learning process, highlighting the significance of seeking out experts, being shameless about asking questions, and embracing a mindset of constant curiosity.

The key takeaway from Chesky’s talk is best captured in his own words:

“The biggest thing I’ve had to learn how to do is learn.”

Chesky’s story is a testament to the power of passion, conviction, and a relentless pursuit of learning. It’s an inspiring tale for any aspiring entrepreneur, emphasizing the importance of staying focused on the core values, adapting to changing circumstances, and building a company that not only disrupts an industry but also creates a better world.

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