Business

Airbnb CEO spells out the end game for the sharing economy, in 7 quotes

Image Credit: Ricky Savi, Aspen Ideas Festival

The CEO of the sharing economy’s newest multibillion-dollar company, Airbnb, recently made some very bold predictions about how he and his industry will reshape the global economy. In essence, Brian Chesky wants a world more like the villages of old: highly trusting and filled with micro-entrepreneurs who shared their assets to make a living.

“Cities used to be generally villages, and everyone was essentially kind of like an entrepreneur,” he told a packed room at the Atlantic Aspen Ideas Festival. “You were either a farmer, or you worked in the city as a blacksmith, or you had some kind of trade. And then the Industrial Revolution happened.”

Part-time freelance work, known as contingent work, is on the rise. In some cases, the sharing economy is leading the way in destroying entire industries, such as the taxi industry, forcing more and more people into contingent work.

Contingent work is less certain: it has less legally sanctioned protections for both workers and consumers, though it is often far (far) more flexible. Ultimately, Chesky argues, the added efficiency of flexible contingent work, especially those jobs involved with sharing assets, will save folks struggling in the worst rungs of the economy.

Given Chesky’s influence on this new economy, his new predictions are of interest to many people.

Efficiency will save us from the robots & recession

Chesky argues that the ability to profit from sharing assets is a business model both resistant to recession and to the coming robot work-apocalypse. “There are some things that are irreplaceable. In the service industry, there things that are deeply human that people want to participate in. So I think this is the beginning of a golden age,” he said, predicting that the industry will be able to create upwards of 100 million micro-entrepreneurs.

Already, he says, he gets emails from hosts saying, “because of you we were able to keep our home.”

In other words, as the economy forces rents up and long-time residents out of their homes, the sharing economy could save the least advantaged from the ravages of capitalism. Chesky has a nice vision, and certainly some people are making rent because of Airbnb. What are the tradeoffs?

[Come hear more about how Airbnb is using nontraditional marketing methods and tools to drive its growth on mobile at our MobileBeat 2014 event next week on July 8 & 9 in San Francisco, where Gustaf Alstromer, the company's product manager for growth, will be speaking on the second day.]

“We used to live in a world were there people, private citizens, a world where there are businesses, and now we’re living in a world where people can become businesses in 60 seconds,” he argues.

While he welcomes regulation, this third category of micro-entrepreneur shouldn’t need a fire marshal and inspections if they want to rent out their home for a weekend.

This flies in the face of cities like New York who want much more stringent regulation of Airbnb renters, even if it creates friction for would-be renters. This requires a whole lot of trust and thus information about each person.

Choose: Live off the grid or have a reputation

“The more you broadcast your reputation, the more you’ll have access too. you can decide to live off the grid, not have a reputation, and that’s fine and go through life. But, fewer people will know you and you’ll have access to fewer things. I actually think that’s a fair proposition.”

So, people will have a choice whether to participate, but it’s a binary one. What gives him so much confidence in reputation?

When reputation fails, firm first and then government

Some people are really racist, especially when they buy things off the Internet. Chesky is optimistic that the more people stay in each others homes, the more they’ll begin to understand those who are different.

But, when their system flags hosts that are unusually bigoted or destructive to their community, the company has an obligation to remove them from the system.

“The community is the first recourse, the platform is the second recourse, and the government is third recourse, rather than the reverse.” Bad reputation may harm a guest’s appeal to customers, but if some hosts continue to refuse to host any black customers, then Airbnb may just kick them off the system.

Chesky seems more optimistic that Airbnb is a better system for creating an open world than the government.

Fewer big chains, less ownership

“Everything will be small; so you’re not going to have big chain restaurants. We’re starting to see you have farmer’s markets, and small restaurants, and food trucks. But, soon, restaurants will be in people’s living rooms.”

Chesky, of course, is directing this trend. Airbnb are secretly piloting a program to host restaurants in people’s homes. And, it doesn’t end there.

Meet mass private transit

Chesky predicts private car sharing companies taking over much of public transit.

“As big as Uber and Lyft are, there are going to be companies I predict that will be as big or bigger that will also disintermediate the public-bus system…Ever been on Virgin America? Imagine you have a shuttle that felt like Virgin America—it had Wi-Fi and baristas, and it costs less than a city bus.”

A bold, if contentious, future

For internet optimists, Chesky and other sharing economy CEOs are building a collectivist utopia, regulated by transparency and a benevolent corporation. For pessimists, it will strip society of the love of ownership and individualism.

Whatever readers want to happen, some version of Chesky’s future seems inevitable.


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30 comments
Sogo Hewitt
Sogo Hewitt

Companies like Airbnb think they should operate outside normal rules that protect consumers.  It's only a matter of time before the law will catch up with them.  He needs to paint Airbnb as something that is transformative, when really it's a more efficient and convenient Craigslist.  But as more hosts get burned by guests that they can't properly screen, you will see backlash.  It's too easy for bad guests to create fake profiles and worm their way into apartments.  And Airbnb's Host Guarantee does not kick in unless you get media coverage for the damage.  This will all catch up with Airbnb.

JD D
JD D

Did Airbnb receive government grants or receive donations from the community or raised funds or utilized volunteers to help build the company?


Bob Clarke
Bob Clarke

Ironic that Chesky blames the economy for driving rents up, when Airbnb itself helps drive up rents. Roughly 1/3 of the 30,000 plus Airbnb units in New York City belong to hosts who have 3 or more units. Are those "average New Yorkers?" People who have 3 apartments to rent? I don't think so. These are people running mini hotel businesses (illegally at that). 


And the idea that now Chesky wants to have people providing restaurant services out of their home kitchens? Wait until the outbreaks of food poisoning start happening. 


Sorry, but the days of our cities being "small villages" are long past. There are reasons for the controls of our society -- public safety reasons; public health reasons. 


Chesky is trying to sell "sharing," but what he is really doing is trying to pump up the value of his company. 

Jonathan Salem Baskin
Jonathan Salem Baskin

The catchphrase "Sharing Economy" is a label for what is really 1) renting, and 2) the destruction of institutions, however imperfect, that societies have created in order to function. The idea that some agnostic tech platform will be a better answer to the big companies it will blow up is more a sales pitch from a wanna-be-big company, than anything else. I wrote about the issue at Forbes: http://

j.mp/SyXWz6

Candy Behunin
Candy Behunin

Share with quality not quantity is a good rule of thumb.

Madhuban Kumar
Madhuban Kumar

Hmm from eye balls to shares and likes. If you connect the dots to anything, there will always be a connection including change in capitalism, utopian society and more! I think while there is lot of idealism and good will the future is not about house shares, but a society that can forge a path to basic shelter, food and education for all and whether the internet in its small way can enable this to happen across the world!

Gabriel Cepeda
Gabriel Cepeda

Could there be any more typos in this article ? Do writers even reread stuff anymore? Smh

Gerard Rego
Gerard Rego

It is not mass production but production by the masses, Mahatma Gandhi and that is the economics of the entire www and mobile economy to be leveraged

Chris Nonya
Chris Nonya

So do I understand this correctly? The workforce in America (Drivers, Teachers, Chefs, Waiters, etc) will take part in a form of a share economy system to only benefit the CEO of a Share Economy System. This is frightening to read, as it is proof that the Middle Class is going to fall and disappear faster than ever. The gap of SUPER WEATHY and SUPER POOR is the only thing that will be of existence. The small family owned businesses in this country are more at risk that ever before. This new Share Economy vision will affect every type of industry as time goes on if this "CEO" has it his way. THE BIGGER PICTURE HERE is that this CEO is using homeowners and putting them at risk so that he (The CEO) can become richer without having any risk involve. Is there a share economy for the CEO's of these tech companies?? Hmm.... Nope and that is why they love it. They are in total control and will not lose a dime. Hilarious how they basically criticize/crucify capitalism, when they are the ones ABUSING THE ASPECT OF CAPITALISM to the extreme. 

Chris Nonya
Chris Nonya

So do I understand this correctly? The workforce in America (Drivers, Teachers, Chefs, Waiters, etc) will take part in a form of a share economy system to only benefit the CEO of a Share Economy System. This is frightening to read, as it is proof that the Middle Class is going to fall and disappear faster than ever. The gap of SUPER WEATHY and SUPER POOR is the only thing that will be of existence. BIGGER PICTURE HERE is that this CEO is using homeowners and putting them at risk so that he can become richer without having any risk involve. Is there a share economy for the CEO's of these tech companies?? Hmm.... Nope and that is why they love it. They are in total control and will not lose a dime. 

Monty Kosma
Monty Kosma

Yep - we're bringing back the world of George Bailey's Building & Loan. Casey Fenton

Chelsea Rustrum
Chelsea Rustrum

Yeah, this is really good - saw it earlier from my Google Alerts. Thanks! :)

Brian Vent
Brian Vent

answer - "helping people help themselves".

Chris Grey
Chris Grey

Interesting and positive vision, though it does conflict with some basic things about people and how they interact with each other.

Randy White
Randy White

Airbnb just sent me a free carbon monoxide detector for the home I rented out to some wonderful folks. They are kicking ass. The next big money comes from the natural progression of aggregating the best selection and prices of Sharing Economy verticals into a single search, like Orbitz and Kayak do for flights. Bright Neighbor is on it: http://t.co/8B0rnrlDRG

Steve Kling
Steve Kling

Here's an 8th quote: "We don't make a profit and we're subject to governmental litigation at every turn."

Randy Vollrath
Randy Vollrath

"as the economy forces rents up and long-time residents out of their homes, the sharing economy could save the least advantaged from the ravages of capitalism."

The ravages of capitalism? The sharing economy IS capitalism. Haha. Capitalism is saving people from capitalism. Or in other words, the (kinda) free market is working. 

Sogo Hewitt
Sogo Hewitt

@Jonathan Salem Baskin very true.  As a host on @Airbnb I have experienced first hand the limitations of Airbnb.  When I first hosted, it was only the technorati that used it; relatively wealthy and educated.  People you would love to rent to in any situation.  


As Airbnb gets bigger you will get the masses applying, including those who would be turned down by any landlord who had an application system.  Airbnb in its paranoia to keep its revenues and fees protected, does not allow landlords to make any kind of meaningful contact with potential guests, in the fear that they will make an off-line transaction.  This  makes it impossible for landlords to properly vet guests.  All you have to go on is a first name, and "verifications" of facebook or linkedin accounts that you can't see.  And how meaningful is a "verified" linked in or facebook account anyway?  


In recent months I have seen a huge uptick in problem tenants that leaves me no choice but to move away from the Airbnb platform.  There was one guest that was kicked out of an apartment, and Airbnb asked me to take him last minute... without telling me that he had been kicked out by his last host.  We have another guest with a restraining order for Domestic Violence who refuses to leave so we need to evict her.  


Airbnb's vaunted Host Guarantee is a sham as well.  I had one guest bring additional overnight guests without paying the additional guest fee, and then left a huge mess in the room for us to clean up.  Airbnb refused to make any deductions from the security deposit because they said they needed the guest's permission in order to do so.  What's the point of even calling it a security deposit then?  Why would an irresponsible guest agree to a deduction?


Airbnb has made many changes recently without informing hosts.  They actually no longer hold on to security deposits, because it's too much of a hassle to return it later.  This is why they are reluctant to make deductions and need guest permission.  They also are removing emails from all communications so that you can only communicate through Airbnb's website. 


This is a fly by night company that is making the rules up as it goes along.  There is still a naive enough population out there of investors and property owners that could prop it up, but eventually reality will set in if they don't change their ways.  Hopefully sooner rather than later.  It's a convenient service but it can't last in this form, and a prime example of why government needs to step in and regulate.