An extraordinary piece of advice from an investor played a pivotal role in propelling Airbnb CEO Brian Chesky’s struggling startup into a colossal industry giant valued at a staggering $70 billion. Chesky himself recently revealed this invaluable advice during a captivating gathering at Stanford Graduate School of Business, asserting that it remains the most valuable counsel he has ever received.
The advice, imparted by none other than Paul Graham, co-founder of the esteemed tech startup accelerator Y Combinator, urged Chesky and his co-founders, Joe Gebbia and Nathan Blecharczyk, to divert their attention towards a select group of ardent supporters instead of attempting to win over a million lukewarm admirers. Chesky described it as an unconventional approach that defies the common wisdom shared by many.
For the fledgling Airbnb, this meant crafting unparalleled experiences for their guests, distinguishing themselves from the generic hotel stays or sofa-surfing encounters. With utmost dedication, the trio earnestly delved into meticulous research, even going to the extent of enlisting the expertise of a storyboard artist from Pixar. Together, they charted out a comprehensive vision of what a five-star stay should entail, ensuring that every moment from check-in to check-out was an extraordinary journey, as Chesky nostalgically recounted.
Simultaneously, they sought to uncover the secret to ensuring hosts’ happiness and comfort. In the early days of the company, shortly after its inception, the co-founders embarked on a memorable expedition to personally photograph Airbnb listings in New York City. This endeavor allowed them to gain invaluable insights into the perspective of the hosts, strengthening their bond and aligning their vision. Chesky shared this captivating anecdote during an episode of LinkedIn co-founder Reid Hoffman’s esteemed podcast, “Masters of Scale,” in 2017.
The small yet devoted group of individuals who genuinely appreciated the Airbnb experience, encompassing both guests and hosts, became the company’s unparalleled “marketing department,” Chesky declared with a gleam of pride at the Stanford event. This ingenious strategy proved to be a resounding success, catapulting Airbnb to unprecedented heights within its first decade. The company effortlessly surpassed the historical legacy of Hilton, a hospitality behemoth that embarked on its journey in 1919 and currently boasts a market capitalization of $36.43 billion. Chesky attributed a significant portion of Airbnb’s initial growth to the remarkable power of word-of-mouth marketing.
Regrettably, Graham’s guidance was not always spot-on, as Chesky candidly revealed. The CEO admitted that the worst advice they had ever received was also from Graham, who insisted that they relocate to Mountain View, California, the home of Y Combinator, in order to achieve success. However, Chesky boldly declared that physical location is not a determining factor for triumph. “You can be anywhere,” he confidently proclaimed. Today, Airbnb remains firmly rooted in San Francisco, even as Silicon Valley experiences a notable exodus of tech companies in recent years. Renowned corporations such as Oracle and Hewlett-Packard Enterprise have opted to relocate their headquarters away from California, seeking greener pastures.
Inc. magazine’s comprehensive data analysis for the year 2020 ranked San Francisco as merely the fifth-best city in the United States for launching a business, primarily due to its exorbitant cost of living. Austin, Texas, triumphed as the top-ranked city, followed closely by Salt Lake City and Raleigh, North Carolina.
Furthermore, Chesky has emerged as a staunch advocate of remote work, a position that has gained significant traction, particularly amidst the ongoing Covid-19 pandemic. Ever since the initial stages of the global crisis, the visionary CEO has championed the concept of working from home, or perhaps, in true Airbnb fashion, working from someone else’s home. Chesky boldly expressed.