Brian Chesky's Leadership at Airbnb That Turned a Crazy Idea Into a $100Billion Company

Brian Chesky's Leadership at Airbnb That Turned a Crazy Idea Into a $100Billion Company

This is the third post of the Leadership Series, where we break down the traits and styles of leaders who've had a significant impact on the companies, countries, or communities they lead. If you are a leader who enjoys disruption, learning, protecting culture, and the entrepreneurial spirit, you would certainly enjoy it and have takeaways to become a world-class leader.

"There’s no learning curve for people who are in war or in start-ups.” ~Robert McNamara

Brian Chesky, the co-founder of Airbnb, lived this quote in his journey of building Airbnb.

Brian was an outsider in the valley, a place particularly famous for its tech mafia. Out of all three founders, he was the only one without prior business or entrepreneurial experience. There was no time for formal training, being groomed by a predecessor.

This played out to his benefit as he got the opportunity to think from first principles, learn from the source, and not be discouraged by crazy ideas. And in a few years, he got clarity on his mission, hacked leadership, and led the team to be immensely successful.

Marc Andreessen, who has seen all types of companies and founders trying to achieve scale, says he “is one of the best new CEOs since Mark Zuckerberg.” Obama bragged about him at an event in Cuba, calling him an “outstanding young entrepreneur." Reid Hoffman described him as an "infinite learner."

How does Brian define himself?

“If you think about it, Airbnb is like a giant ship. And as CEO, I’m the captain of the ship; the first job I have to worry about is everything below the waterline; anything that can sink the ship.” ~ Brian  (source)
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Under Brian Chesky, Joe Gebbia, and Nate Blecharczyk's leadership, Airbnb has impressive numbers to show:

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5  Lessons From Brian Chesky's Leadership At Airbnb

Hack leadership: Go to the source of knowledge

The first impressive leadership trait that you find in Chesky is his way of reaching out to experts to seek help for a problem. He calls this practice "going to the source".

Instead of taking advice from ten people and trying to get all different opinions, he prefers reaching out to the only person who can tell him more about that one thing than anyone else.

“If you pick the right source, you can fast-forward,”  ~ Brian.

To decode the art of building tech companies in Silicon Valley, he reached out to Reid Hoffman, Marc Andreessen, and Ben Horowitz.

His mentor for design was Apple’s, Jony Ive. LinkedIn’s Jeff Weiner and Disney’s Bob Iger taught him management. Meta's Mark Zuckerberg gave valuable lessons on building products, and Sheryl Sandberg advised him about international expansion and the importance of empowering women leaders. These are obvious choices but as a creative genius, he would also source from unexpected disciplines.

Chesky reached out to former CIA director George Tenet, not for safety but to talk about culture and hospitality expertise. He went to Frech Laundry to study how the legendary restaurant treats its customers and plates its cuisine instead of going to Marriott or Hilton.

Takeaway:

Regardless of the level of your leadership role, you need to stand on the shoulders of giants. A thought we highlighted in Lee Kuan's leadership journey as well. If you can find experienced mentors who have a vast amount of knowledge and expertise on certain topics, it can change the course of your company. You might have access to the giants like Hoffman or Theil right now but find you can always find people a few years ahead of you.

Become a learning machine

“Brian’s biggest strength is that he is a learning machine,” says Reid Hoffman
“He is a learning animal,” says eBay’s Donahoe. (Leigh Gallagher's The Airbnb Story)  

The countless other comments by people who know him show that Brian is obsessed with new information and feedback and has extreme curiosity levels.

He was always looking to up-level and gain new information about how he could improve by gathering feedback.

Hoffman narrates the story of an interview with Chesky in San Francisco in Airbnb’s early years. When they were barely down the steps from the stage, Chesky turned to Hoffman and asked him for feedback on what Hoffman thought Chesky could have done better.

Sequoia's Alfred Lin says his focus on learning is why Airbnb could scale as a company. He is impressed by how Brian constantly takes notes of conversations with people. The next time they see him, he would have formed a more informed opinion about the topic as he would have talked to other experts and thought about it.

Takeaway:

Successful people from different walks of life are all lifelong learners, curiosity-driven, and keep pushing themselves to get better to find solutions to their problems. Learning can come from books, observing your environment, going to conferences, or just talking to people in your company. As long as you become smarter every day, you won't become outdated.

Maintain communication and humility in unprecedented times

When the global pandemic hit, Airbnb lost 80% of its business in just 8 weeks. Brian realised that no company had gone through a similar situation, and there was no playbook to rely on.

He thought from first principles and asked himself, "What do we need to do" and then acted fast.

He realised three important things he needed to take care: Transparent communication, optimism, and saving the community of hosts, guests, and employees they had to lay off.

Looking out for his community:

When 25% of the team was laid off, Airbnb waived the usual vesting cliff so people could exercise their stock options. The recruiting team was directed to stop hiring new employees and rather help former employees find new jobs. He personally reached out to his peer CEOs, asking them to consider the laid-off individuals for jobs. He decided to cushion the blow of refunds on hosts by distributing $250million to them.

He approached the situation in a systematic but personal, fair, and empathetic way.

Ramping up the communication:

For a few weeks after all of the world travel had shut down, instead of staying put and 'praying' for things to normalise, he ramped up his communication with the team. That always helps lower everyone's anxiety about what's happening and teaches them to adapt to new changes.

To ramp up his communication, instead of monthly all-hands, he started doing weekly all-hand. Instead of quarterly board meetings, he did weekly board meetings to keep everyone abreast with the rapid changes that were happening.

Staying optimistic:

Airbnb could turn a crisis into an opportunity when local tourism started opening and people got comfortable with taking online experiences. Optimism helped the company stay resilient to figure out new ways to do business.

“The trick is to be optimistic. The optimism has to be rooted in facts that you can present as a case to people, to tell them, ‘I'm optimistic because here’s where we’re going, and here’s how we’re going to get there.” ~Brian

(source)

Takeaway:

Everyone can be a good leader when things are going by the book. The crisis and difficult times are a true test of one's leadership skills.

People look up to leaders in times of crisis. And it's easy to throw in the towel and apologise for the tough times but building optimism, having good communication and actually embodying the 'we are in this together' are the sign of an admired leader. These will help you think creatively during tough times and stay resilient.

Keep the entrepreneurial spirit going

In an interview with Box CEO Aaron Levie, Brian mentioned that the key to scaling up a company is not to forget the qualities you had as a startup -- agility, fast decision, culture for innovating, collaboration, and result-oriented.

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“We started noticing as we were growing, we had to scale, we were hiring more leader-stage, bigger company people – and you need them. But you also need entrepreneurs to keep doing new things. But you're not going to keep entrepreneurs if you don't keep doing new things.” (source)

He nurtures an entrepreneurial spirit by allowing his team to experiment, fail, learn and try again. Airbnb Experiences was launched as a product twice before it finally took off. An enterprise would have closed the case and marked it as a certain failure but Brian believed in innovating and trying different ways.

Takeaway:

Don't stop treating your company like a startup even if you've scaled to multiple geographies or many vertices. And if you are leading a startup, embrace the things you can do now that would be much harder when you grow. Take advantage of them.

Once you grow, bring in processes but don't stifle the work environment with bureaucracy, slow decision-making, or politics. Encourage failure and innovation.

Don't mess-up the culture

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Out of the most important things that Brian Chesky overseas at Airbnb is culture. He defines culture as a shared way of doing things. He believes that breaking the culture breaks the machine that creates products, as it is the foundation of all innovations. That's why he personally interviewed every job candidate until the company got to be more than three hundred people.

This realisation of preserving the culture came to him after he asked Peter Thiel about what was the single most important piece of advice he had for them. Peter replied,  "Don’t fuck up the culture." (read Brian's full post about it here.)

A strong culture helps you trust everyone to do the right thing without micro-managing and to let people have autonomy.

Takeaway:

The first thing you can do to keep your company's culture intact is to make your core values absolutely clear in your head and let your team know about them.

Don't just define values. Live them through your hiring process, how to do meetings, write emails or conduct business. Ensure you bring in people from diverse areas and skillsets so your culture can grow.

Brian Chesky's Leadership Style: Transformational

What is transformational leadership?

Transformational leadership is a style where a leader inspires employees to achieve exceptional outcomes. And in the process, they develop their own leadership style.

Leaders encourage employees to innovate and have no limits to their imagination. They also set examples for the same at the executive level through a strong sense of corporate culture, employee ownership, and independence in the workplace.

4 distinct behaviours, also known as the four I's, that transformational leaders have are: inspirational motivation, idealised influence, intellectual stimulation, individualised consideration.

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What are the pros and cons of the transformational style of leadership?

Advantages of transformational leadership style:

  • It gives people the autonomy to work. This improves job satisfaction and increases retention.
  • Encourages learning and creativity that eventually brings value to the business
  • Keep the communication transparent and open. This reduces any politics and unnecessary confusion.
  • Helps manage change and crisis gracefully.

Disadvantages of transformational leadership style:

  • Requires constant and consistent feedback
  • May ignore certain protocols that can be disruptive
  • Can lead to employee burnout due to extraordinary standards
  • Can be risky and disruptive in environments where quick decisions need to be taken

When should you use transformational leadership?

  • If an organisation hires well and develops a positive corporate culture, transformational leadership can drive growth as people are given the freedom to innovate.
  • When a leader is clear about a vision and the vision is greater than the self-interests of fame or wealth.

When is transformational leadership least helpful?

  • When a business has a lot of processes or compliance requirements, transformation leadership would probably be the wrong choice because of its out-of-the-box thinking nature.
  • When there is misalignment between the team members and leaders on vision and understanding of culture.

Stick Them in Your Journal

If you have never stayed in an Airbnb, I highly recommend you give it a try. And when you go there next time, reflect on how the strong leadership from Brian could help build a company that made it possible for us to belong anywhere.

You can save this piece to your tab, send it in an email to yourself or share it on your Twitter account, but the most effective way would be to note these quick takeaways in your journal (digital or paper):

  • Hack leadership: Go to the source of knowledge
  • Become a learning machine
  • Maintain communication and humility in unprecedented times
  • Keep the entrepreneurial spirit even after growth
  • Don't mess up the culture

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