Introduction

In this compelling episode of The Social Radars, Jessica Livingston and Carolyn Levy sit down with Brian Chesky, co-founder and CEO of Airbnb, to continue the fascinating story of Airbnb’s rise from near failure to global success. Picking up where they left off, Brian shares candid insights into the scrappy early days, the transformative experience of Y Combinator, and the painstaking hustle that turned Airbnb into a rocketship.

But the conversation goes far beyond startup origins. Brian opens up about the seismic impact of the COVID-19 pandemic on Airbnb’s $35 billion business, revealing the intense leadership decisions, personal struggles, and radical company restructuring that saved the company from collapse. He offers a masterclass in crisis management, leadership under pressure, and the surprising benefits of returning to startup discipline—even within a massive public company.

If you’re an entrepreneur, leader, or simply curious about the human story behind one of the world’s most iconic companies, this episode delivers an extraordinary depth of experience, wisdom, and actionable advice. Brian’s journey is not just about Airbnb’s success, but about resilience, reinvention, and leading with clarity when everything is on the line.

Episode Information

Podcast: The Social Radars
Episode: Brian Chesky, Co-Founder & CEO of Airbnb
Published: 2023-09-13
Duration: 01:14:14

🎧 Listen to this episode: Play on Apple Podcasts →

From Near Failure to Rocketship: Airbnb’s Early Days and the YC Experience

Jessica Livingston recaps the story so far: In 2007, Brian Chesky and Joe Gebbia hosted three guests on air mattresses during a design conference in San Francisco. That magical experience planted the seed for Airbnb’s original concept: Airbed and Breakfast. But the next year was a grind — slow growth, scarce guests, and repeated fundraising rejections.

By fall 2008, the company was at a crossroads. Brian recalls, “We said, OK, if this doesn’t work, we’re done.” They applied to Y Combinator (YC), convinced Nate, their technical co-founder, to move from Boston to the Bay Area for three months, and committed to giving it their all.

At YC, the pressure was intense. Paul Graham pushed them hard: “Where’s your growth? Is anyone buying this?” Their data showed interest clustered in New York City. Paul’s advice was decisive: “Go to New York. Go to your users.” Despite feeling that this was unscalable, Brian remembers, “Paul said, that’s exactly why you should do it now.”

The Discipline That Created Culture

Brian shares an eye-opening glimpse into their YC routine, revealing the scrappy discipline that shaped Airbnb’s culture for years:

“We lived together in an apartment. We’d wake up around 8 a.m., work, go to the gym together, grocery shop, and work late into the night. Every Sunday, we’d recap what we’d done and plan for the next week. We put a red line on the bathroom mirror representing ‘ramen profitability’ — the minimum revenue to keep the company alive without external funding. That line was the first thing we saw every morning and the last thing we saw every night.”

He emphasizes how these “subtle habits” became a cultural foundation:

“When a thousand people do something a thousand times, that’s your culture.”

Jessica adds some context on those early numbers, noting that in February 2009, Airbnb’s weekly revenue went from $468 to $1,428, reaching that “ramen profitable” threshold for the three co-founders. Brian reflects:

“If I were a founder today, I’d definitely want more than $1,400 a week for three of us to live. It’s crazy how much things have changed in 14 years.”

The Power of “Doing Things That Don’t Scale”

Despite their small size, Brian and team went all in on personal outreach in New York City:

“We literally went door to door, knocking on hosts’ doors. Sometimes they’d say, ‘You’re really small.’ I carried a backpack with a toothbrush, change of clothes, and a binder of checks — because we paid hosts by hand before automating payments. We did everything unscalable before we scaled.”

They observed hosts’ pain points, particularly the poor quality of photos:

“In 2009, camera phones were terrible. Hosts didn’t know how to take good photos or upload them properly. So, we created a magical service where you could click a button and a photographer would show up. At first, Joe or I would be the photographer with rented cameras, then contractors, and eventually a large network.”

This hands-on approach to quality and customer experience was innovative for its time:

“We were the first site where you could book with someone else and pay online through the app. Before us, sites like Etsy or eBay used PayPal, but you had to leave the site to pay.”

Brian explains the mindset behind these moves:

“Steve Jobs used to say, ‘You have to start with the customer experience and work backward to the technology.’ We imagined the magical experience first, then figured out how to build it.”

This approach gave Airbnb a huge edge over existing classified sites like Craigslist, which had tiny, low-quality photos and no integrated payments.

The Importance of Talking to Users and Systematizing Feedback

Brian describes how they obsessively collected user feedback and incorporated it directly into their product:

“Joe would carry a binder full of notes from hosts. We photographed their homes, guided their pricing, and worked block by block to build supply. We didn’t have a marketing budget, so we relied on PR stunts and a smart Craigslist reposting tool Nate hacked together.”

This relentless focus on user obsession and systematized feedback remains a core Airbnb practice:

“Growth is the output everyone wants, but customers like great products. You have to talk to them, observe them, and obsess over every detail.”

Ultimately, Airbnb’s growth was not from a “silver bullet,” but from persistent iteration and incremental improvements until reaching a tipping point.

Expanding the Market: From Airbeds to Entire Homes and Beyond

Initially, Airbnb was a niche, quirky idea focused on renting air mattresses in shared spaces. But Brian recalls a key moment at South by Southwest 2008:

“A guy wanted to rent his extra bedroom — no airbed. We said, ‘OK, you can buy an airbed,’ but realized soon after that people would want to rent real bedrooms.”

This realization expanded Airbnb’s potential market from a novelty to a real business, but the next leap was even bigger:

“A drummer for Barry Manilow wanted to rent out his entire house while on tour. We debated internally: could we allow whole-home rentals, especially if the host wasn’t there to make breakfast? We moved from ‘Airbed and Breakfast’ to letting people rent their entire apartments.”

This shift transformed Airbnb from a small-scale idea to a company with massive potential:

“That was the point Airbnb went from a kitschy side project to a business with billion-dollar potential.”

Brian shares colorful stories of unique listings that followed:

“People put up treehouses, castles, igloos, even private islands. We had a saying: you can rent anything from a couch to a castle.”

This constant push and pull between following user behavior and inspiring new possibilities helped Airbnb build one of the most extensible platforms on the planet.

Challenging Conventional Market Thinking

Brian reflects on how Airbnb’s market was misunderstood by investors early on:

“When you’re called Airbed and Breakfast, people think the market is tiny — how many airbeds are sold a year? But a great entrepreneur can find a large market within their idea.”

He contrasts this with Apple’s early days:

“Apple started in a tiny market — personal computers — but created a new category and, by extension, a huge ecosystem.”

For Airbnb, the broader market was travel, a massive global industry comparable in size to oil. Yet the “vacation rental” term was barely known in 2009.

Brian’s advice to founders:

“Don’t invest in markets, invest in entrepreneurs who can create and expand markets.”

Taking the Strange Out of Strangers: The Philosophy Behind Airbnb’s Trust System

One of the most powerful insights Brian shares is about the social barrier to Airbnb’s idea:

“We had to overcome the fear people have about strangers in their homes. People say, ‘I wouldn’t stay in a stranger’s home,’ but if you describe that stranger as a specific person — a Stanford PhD student studying X — suddenly it’s not scary.”

This led to Airbnb’s foundational mission:

“We needed to build a system of trust to ‘take the strange out of stranger.’”

Brian believes their unique insight stemmed from their naivety:

“We were 26-year-old naive founders who didn’t know what was impossible. We discovered an experience and wanted to share it.”

He emphasizes the importance of youthfulness at heart:

“You don’t have to be young in age, but you have to be young in spirit — curious, open, and able to suspend disbelief.”

The Pandemic Crisis: Losing 80% of Business and Leading Through the Abyss

Fast-forward to late 2019 and early 2020: Airbnb was booming, with $35 billion in annual bookings — comparable to Nike or Starbucks in sales volume. Brian describes the shock:

“We lost 80% of our business in eight weeks.”

He recalls the eerie moment when the NBA suspended its season in mid-March 2020:

“That was the signal that the world was shutting down.”

Brian’s lead independent board member, Ken Chenault, a CEO veteran of crises like 9/11 and 2008, called him:

“Ken said, ‘This is going to be 10 times worse than 9/11 or 2008.’ And it was.”

Brian shares the brutal truth:

“People were talking bankruptcy. We were just weeks away from going public and suddenly the business was crashing.”

The Defining Moment of Leadership: Managing Your Own Psychology

Brian reflects deeply on leadership in crisis:

“The hardest thing isn’t market or money; it’s managing your own psychology. People look to their leader’s face for hope. You have to be transparent, confident, and optimistic — but not delusional.”

He echoes Andy Grove’s wisdom:

“Bad companies are destroyed by crisis. Good companies survive. Great companies are defined by it.”

Recreating YC Intensity with 5,000 Employees

Brian describes how he recaptured the startup intensity of YC:

“We got in a foxhole. Every week counted, then every day, then every hour, then every minute. I did all-hands Q&As weekly and daily standups with my exec team. We had board meetings every Sunday.”

He worked 18-hour days, communicating constantly with the board, executives, employees, hosts, and guests.

Making Principle-Based Decisions Amidst Data Fog

With no reliable data, Brian leaned on principles:

“In crisis, you make principle decisions, not business decisions. The distractions fall away and only what matters remains.”

He focused on the company’s core mission:

“Why do we deserve to exist? Because if we don’t do this, no one else will.”

Radical Focus: Shuttering 80% of Products and Cutting Deep

This clarity led to hard choices:

“We shuttered 80% of our products, turned over half of our executive team, refunded $1 billion in customer deposits, and raised $2 billion in emergency debt financing.”

Brian explains why they chose debt over equity:

“Debt saved dilution. We were bullish on the future despite the crisis.”

He shares the emotional toll of layoffs:

“Our mission is belonging, so layoffs were brutal. I reviewed every employee by name and made those decisions personally.”

Leading with Radical Transparency and Compassion

Brian’s approach was to be open and honest:

“I told employees about the risk of bankruptcy. I said, ‘We survive or die trying.’ I did weekly all-hands because people needed to ask hard questions.”

He also rallied the team with a renewed vision:

“If you thought you joined Airbnb too late, you’re back at the founding moment. This is a re-founding.”

Reinventing Airbnb: From Divisional Chaos to Startup Discipline Within a Giant Company

Brian reflects on the organizational challenges pre-pandemic:

“We had multiple divisions — China, homes, pro host, experiences, Lux, transportation, magazine — and people could pick their own teams and projects. We democratized data and decision-making, hoping to empower people.”

But he realized this decentralization slowed them down:

“People want constraints and to row in the same direction. The divisional structure created politics, bureaucracy, and complacency.”

Inspired by Steve Jobs’ return to Apple, Brian reversed course:

“We went back to a startup model with functional departments — marketing, ops, engineering, design. One roadmap. No swim lanes.”

He personally reviews every product before launch:

“I’m not micromanaging; I’m the orchestra conductor making sure we play one cohesive sound.”

This created a “shared consciousness”:

“The top 30 people work on everything together. Next 300 people share that consciousness. Next 3,000 too. It’s a solar system, not a pyramid.”

Embracing Details and Expertise

Brian emphasizes the importance of being deeply involved:

“I wrote 14,000 words of the S1 myself. Engineering managers must code — otherwise it’s like a cavalry general who can’t ride a horse.”

He likens running Airbnb to a hardware startup:

“You can’t ship everything all the time. You must be thoughtful, deliberate, and disciplined.”

Growth, Profitability, and Culture: Lessons Learned and the Road Ahead

Brian sums up Airbnb’s state pre- and post-pandemic:

“Before COVID, we lost $250 million a year. Last year, we did $3.8 billion in free cash flow — generating more profit per dollar than Google or Apple.”

He calls Airbnb the “startup equivalent of Navy SEALs” — small, elite, efficient:

“We kept headcount flat for years, about 5,500 employees, doing $3.4 million per employee. Adding people slows you down.”

He warns against common startup mistakes:

“Most raise too much money, hire too many people, and go in too many directions.”

Brian stresses leadership presence:

“Leadership is presence, not absence. If you empower people by leaving them on their own, you’re just letting bureaucracy and politics run wild.”

He models the behavior he expects:

“I work day and night, get in the details, and never ask anyone to do what I wouldn’t do myself.”

Reflections on Going Public and Leadership Philosophy

Asked about the IPO transition, Brian says:

“Being a public company CEO was the least dramatic thing in my life. Running a travel company in a pandemic was way harder.”

He notes the irony that late-stage private companies can be harder than public ones:

“There’s pressure and lack of transparency in private companies that can be worse than public scrutiny.”

To keep focus, Airbnb does biannual “giant product releases” like a hardware company:

“It keeps the whole company rowing in one direction.”

Brian advises entrepreneurs facing pressure:

“If you slow down and breathe, adrenaline will give you courage. The best way to keep your balance is to keep moving.”

Conclusion: The Power of Resilience, Focus, and Leadership

Brian Chesky’s story—from scrappy early days to pandemic survival and beyond—is a powerful testament to resilience and leadership. His candid account reveals that success isn’t accidental; it’s forged through relentless focus on customers, radical transparency, and the courage to make hard decisions.

The pandemic crisis forced Airbnb to re-learn its startup roots on a massive scale, proving that even giant companies must embrace discipline, simplicity, and shared purpose to thrive. Brian’s leadership philosophy—presence over absence, optimism grounded in reality, and obsession with detail—offers invaluable lessons for founders and CEOs navigating uncertainty.

As Brian puts it:

“Don’t stop. Keep going. The faster you go, the more balance you have.”

For anyone building a company or leading through turbulence, that is a mantra worth remembering.

Additional Insights from the Hosts

Jessica Livingston and Carolyn Levy reflect on Brian’s story, marveling at the intensity and depth of his pandemic leadership. They highlight the difficulty of layoffs, the power of “taking the strange out of stranger,” and the connection between personal passion and startup success.

Carolyn notes:

“Brian’s story is one of the most intense pandemic leadership accounts we’ve heard. The focus, determination, and care he showed are inspiring.”

Jessica adds:

“It’s amazing how the founding ethos—hosting and connecting people—has shaped every stage of Airbnb’s journey.”

This episode is a treasure trove of wisdom for entrepreneurs, leaders, and anyone interested in the human side of building and sustaining a world-changing company. Brian Chesky’s journey reminds us that behind every great business is a story of grit, vision, and the power of relentless optimism.

References and Resources

• Listen to the full episode on Apple Podcasts
• Y Combinator essays by Paul Graham, including “Do Things That Don’t Scale” and “Make Something People Want”
• Airbnb’s public filings and investor information (S-1 filings)
• Leadership books and articles referencing Andy Grove’s “Only the Paranoid Survive”

Article by The Social Radars team