Airbnb CEO: ‘We’re going to step on the gas’

Airbnb CEO Brian Chesky sits down with Yahoo Finance's Akiko Fujita to discuss the sell-off occurring in the tech industry, Airbnb's outlook and travel projections, the app's redesign keying in on unique experiences for customers, and remote work benefits.

Video Transcript

DAVE BRIGGS: Are you getting away this summer? Well, Airbnb unveiling its biggest platform redesign in a decade. Akiko Fujita here with the company CEO, who had some fascinating comments, Akiko, regarding the future of the office. Can't wait to hear them.

AKIKO FUJITA: Yeah, let's get right into it, Dave. We've got Brian Chesky here, the CEO of Airbnb. By the way, our very first studio guest--

BRIAN CHESKY: Yeah, I'm happy to be here.

AKIKO FUJITA: --since the pandemic.

BRIAN CHESKY: Happy to be here.

AKIKO FUJITA: So it is great to have you here. I want to start with what's playing out in the markets. Can't ignore it. We have seen a significant selloff in tech stocks. Airbnb alone down, what, more than 30% in the last month, 52-week low today. What do you think is going on?

BRIAN CHESKY: Well, you know, I primarily would just say that I, as a CEO, try to focus on what I can control. And so I try to limit how much I talk about what's going on in the markets. But I think that, obviously, this is like a correction that I haven't probably seen since I came into Silicon Valley in 2008. And maybe it's more profound than the changes that we've seen in 2008.

I started Airbnb with my friends, and we really got going, like, in 2008. 2009, we joined Y Combinator. The economy was so bad that I remember Paul Graham saying there might be no investors at demo day. And what I tell people is, this might be the end of a moment. But there's always the next moment. If you're building something important, you just keep building and you wait for the next moment.

AKIKO FUJITA: You say worse than 2008 potentially. Why?

BRIAN CHESKY: Well, potentially for tech. I mean, I don't know-- I don't recall how much tech stocks were down in 2008, but the fundraising environment was pretty chilled in 2008. But a lot of investors and people that I respect are saying this is more like June 2000. But again, I was in college back then. And so I have no recollection, really, of the dotcom crash. I wasn't really paying attention to tech back then.

AKIKO FUJITA: You think this is ultimately a good thing? There's a bit of a shakedown happening. There's been a lot of money floating around, not just in the public markets, but in the private markets as well.

BRIAN CHESKY: Well--

AKIKO FUJITA: Is there a bit of shakedown that was needed?

BRIAN CHESKY: I don't want to say it's a good thing, because I think it's kind of like overeating could kill you, and undereating can kill you, and the same thing with funding. I think that startups generally raise too much money. They spend too much money. I think having too much money perpetuates ideas that aren't maybe meant to be perpetuating. You can pursue strategies for too long.

At the same time, that doesn't mean that, like, an investment nuclear winter is good either. And I think that this is going to be causing a lot of pain and suffering. So I'm not going to say that's a good thing. But I do think that some of the best companies are born in recessions. They're born in crisis. And I think that adversity will make great companies better if they can make it through.

AKIKO FUJITA: We've seen a lot of companies slowing some of their hiring, in some cases, freezing. Uber CEO Dara Khosrowshahi recently came out and said there is a seismic shift that's happening in investor sentiment. They have to be a leaner company. How does this change the way Airbnb operates? Have you seen that shift from your investors?

BRIAN CHESKY: We're going to step on the gas. Like, now, we're going to go even harder. I mean, why would the stock price affect how we run the company? Like, we went through an incredibly intense period in 2000. We lost 80% of our business in eight weeks.

And the reason we did a layoff is because we're actually burning a huge amount of free cash flow. We were burning a lot of cash. And so we had to rightsize our business. We had to get really focused. In Q1, we generated $1.2 billion of free cash flow. The company is financially stronger than it's ever been before. More people are going to travel this summer than we think we've ever seen. We just rolled out the biggest update to our app in a decade. So we are absolutely stepping on the gas.

And I think the ultimate way to look at the strength of a company is to look at the strength of their financials, and we're very strong. And so we're going to run the company based on our inputs, the things we can control. And we can control our product. We can control our financials, to some extent. The stock price, we actually can't completely control, especially when it's things that are very sector oriented.

AKIKO FUJITA: Let's talk about that revamp.

BRIAN CHESKY: Yeah.

AKIKO FUJITA: The largest revamp in a decade-- what prompted it?

BRIAN CHESKY: What prompted it is, the pandemic changed the world. The pandemic changed the way we work. People aren't going back to an office, most people, five days a week. And if you don't have to go back to the office five days a week, it means you have incremental flexibility. And so suddenly millions of people can travel more places. They can work more places. And many of them are working and living in Airbnbs. And we realize the world's changed, but the way people search for travel hasn't.

Because for most travel websites, for 25 years, there's a search box. And they ask you to type a place into the search box. We did that, too. And the problem is, people only type in, like, the 10, 20 places they can think of. And we wonder why everyone goes to the same cities. And we thought Airbnb's in 100,000 locations. What if we allow you to search not just by the place that you could think of, but you can discover, like, based on your passions, your interests?

And so we launched Airbnb Categories. We have 4.4 million homes that are categorized in 56 different, like, different collections. We have a castles category, a golfing category, a vineyard category, a national parks category. Really, there's a category for everyone. And we think this is a whole new way to search and discover a world of possibilities. And we think the pandemic has created a shift, the biggest change in travel since World War II. And we think people are ready for a new way to travel.

AKIKO FUJITA: The OMG category--

BRIAN CHESKY: Yes.

AKIKO FUJITA: --was the most interesting to me, because you're looking at buildings that are, like, different shape, right? These aren't just homes.

BRIAN CHESKY: There's, like, a building that's, like, a actual snake. And there's, like, little cabooses, and there's pretty incredible things. Like, there's a yellow submarine in the forest in New Zealand. It's just, we were even trying to think of what do you call this category. And, like, somebody just said, oh, my God, I can't believe these exist, and I said, there you go. There's the name.

AKIKO FUJITA: There's the category right there.

BRIAN CHESKY: And I think there's a really interesting lesson here, which is that Airbnb is limited to people's imagination. And also, people don't just want to stay in the same kinds of spaces as they did before. People want something unique. They want to have an experience. They want to do something they can remember. And Airbnb is a really good way, obviously, to do that, especially things like the OMG category.

AKIKO FUJITA: Let me ask you about the travel outlook because I know in your most recent earnings call, you talked about the strong bookings you've gotten for summer all the way out to Q4. And yet, today, we got some data that pointed to US airline bookings dropping 17%. Yesterday, we saw data that showed airline tickets are up 18%. How do you think that's going to affect Airbnb?

BRIAN CHESKY: It might. If fewer people fly, then my intent-- my presumption is fewer people cross the border. And so we'll have, in that environment, more domestic travel, which is what we saw the last two years, actually. So in 2020, we were able to rebound faster than any other company in the-- any other travel company, to my knowledge. And the reason why is because people weren't traveling for business. They weren't crossing borders. They weren't going to tourist destinations. They were getting in cars, driving about a tank of gas to a home they would stay in with friends and family on Airbnb.

So I think the key thing is, we have a really resilient model, how we have nearly every type of space at nearly every price point in nearly every community in nearly every country in the world. However travel changes, luckily, we have a community that can adapt and be pretty resilient. So it may change the mix shift, but it doesn't really-- I don't anticipate changes in our outlook.

AKIKO FUJITA: Finally, I have to ask you about an internal change that's happened. You recently announced that all employees for Airbnb can work and live anywhere. Now you've got, what, 6,000 employees roughly, but you said you had a surge in your jobs page. More than a million people?

BRIAN CHESKY: Yeah, so we announced on April 28 that Airbnb employees can now live and work anywhere. In fact, you can go to 170 different countries and go for 90 days at a time in each country. And if you move anywhere in the country you work, and you've authorized the work, we're not going to lower your pay. So if you live in San Francisco and you want to go move to Iowa, you're going to get the same salary. We're not going to dock your pay. Since we made that announcement, more than one million people visited our jobs and careers page. And I think what that says to me is, this is what people want.

AKIKO FUJITA: Future of work, no more office space, right? We're sitting--

BRIAN CHESKY: Not as much.

AKIKO FUJITA: --in a building with an office space.

BRIAN CHESKY: Not as much. I don't think offices will go away, but I think the office as we know it is going to go away. This is just a sign of things to come. People will always want to be together. People don't want to only be on Zoom. They don't want to only be remote. But just because they want to be together doesn't mean they want to be in office three days a week.

AKIKO FUJITA: I'd be curious to see how many of those 6,000 employees actually move abroad. But Brian Chesky, good to have you in studio.

BRIAN CHESKY: Well, thank you for having me today.

AKIKO FUJITA: Thank you so much for joining us. Rachelle, I'll toss it back to you.

RACHELLE AKUFFO: All right, I mean, fantastic stuff. You had me at castle. When I'm thinking of places that I'm going to Airbnb, this has expanded my horizons.

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