Money Rehab with Nicole Lapin - Brian Chesky (CEO of Airbnb) on Founder Mode, Tips for Airbnb Hosts and a Big Announcement

Episode Date: October 16, 2024

Today, we're getting business advice from one of the entrepreneurship rockstars of our time: Brian Chesky, CEO and cofounder of Airbnb. In their conversation, Brian shares advice for founders, tips for Airbnb hosts (and prospective Airbnb hosts) and strategies for entrepreneurs starting businesses with their friends. And yes— Nicole and Brian also talk about founder mode. Plus, Brian announces a new Airbnb feature that makes it easier than ever to make some extra cash from your home. $ Take control of your finances by using a Chime checking account with features like no maintenance fees, fee-free overdraft up to $200, or getting paid up to two days early with direct deposit. Visit: http://chime.com/MNN  $ Looking for the perfect holiday gift for your coworkers, friends, and everyone in between? Choose Nicole’s favorite wine, Justin. Get 20 percent off your order for a limited time with the code “MONEY20” at http://justinwine.com/  $ Ready to find a financial advisor that’s right for your financial goals? Get matched with a trusted, vetted financial advisor at: http://moneypickle.com/MNN  All investment strategies involve risk of loss. The information shared in this podcast is for informational and entertainment purposes only. Listeners should do their own research and consult a financial advisor before making any investment decisions. See terms for additional details: https://moneynewsnetwork.com/terms/ 

One of the most stressful periods of my life was when I was in credit card debt. I got to a point where I just knew that I had to get it under control for my financial future and also for my mental health. We've all hit a point where we've realized it was time to make some serious money moves. So take control of your finances by using a Chime checking account with features like no maintenance fees, fee-free overdraft up to $200, or getting paid up to two days early with direct deposit. Learn more at Chime.com slash MNN. When you check out Chime, you'll see that you can overdraft up to $200 with no fees.

If you're an OG listener, you know about my infamous $35 overdraft fee that I got from buying a $7 latte and how I am still very fired up about it. If I had Chime back then, that wouldn't even be a story. Make your fall finances a little greener by working toward your financial goals with Chime. Open your account in just two minutes at Chime.com slash MNN. That's Chime.com slash MNN. Chime. Feels like progress. Banking services and debit card provided by the Bank Corp. Bank N.A. or Stride Bank N.A. Members FDIC. SpotMe eligibility requirements and overdraft

limits apply. Boosts are available to eligible Chime members enrolled in SpotMe and are subject to monthly limits. Terms and conditions apply. Go to Chime.com slash disclosures for details. So recently I started looking at my wellness routine and I wanted to see if there was any way I could enhance my results. I looked at my vitamins and I realized they were not as clean as I had thought. The list of ingredients was long with things like gelatin and artificial flavors, which obviously have no added value and can cause some digestive issues. After doing some research, I came across Vimergy. Vimergy makes liquid vitamins and supplements that use clean ingredients and are not loaded with unnecessary fillers and binders like citric acid. And because they're liquid, they absorb faster than tablets, gummies, and capsules.

And they're much easier to take if you have difficulty swallowing your pills, which I always have. It's a whole process. I've tried putting the water in first and then the vitamins and just... And unlike multivitamins, you can actually customize your vitamin routine so you only take what you need and nothing you don't. They're honestly so easy to integrate into my day. I just add them into my morning juice or smoothie and at night in my tea before I go to bed. Right now, Vimergy is offering my listeners free shipping using the code MNN, and you can save up to 12% with their Mix and Save program. That's Vimergy.com, save up to 12% with their Mix and Save program. That's vimergy.com, V-I-M-E-R-G-Y.com with code MNN as in Money News Network. Try them today. I can't wait to hear what you think and more

importantly, how you feel. I'm Nicole Lappin, the only financial expert you don't need a dictionary to understand. It's time for some money rehab. Money rehabbers, you have been waiting for this interview and here it is. I am talking to Brian Chesky, CEO of Airbnb. No matter how plugged into the world of business you are, you know that Brian is a rock star in the business world. And if you're living inside that world, you know just how big of a deal he is. Today, Brian tells me about an exciting Airbnb update that was just announced today. Plus, Brian also gives amazing advice for entrepreneurs ranging from how to work with your friends to separating your identity from your business. And yes, founder mode, that simple phrase that has been shaking up Silicon Valley. Here's Brian.

Welcome to Money Rehab. Well, thank you for having me today. So you have some exciting news. I don't want to steal your thunder. So with no further ado, tell us the big news. Yeah. So I have two things I want to tell you about. The first thing is co-host network. So what is co-host network? Well, Airbnb is a great way to make extra money. It's a great way to make even tens of thousands of dollars without dedicating your time to a full-time job with an asset you already have, your own home. And a lot of people have expressed interest to hosting, but some people say they don't have the time to host. And maybe they just don't feel like they have time, or maybe someone lives in LA,

host. And maybe they just don't feel like they have time. Or maybe someone lives in LA, but they have a vacation rental home in San Diego, and they can't get to San Diego to check the guest in. And so we thought, what if we matched people with homes without time with hosts on Airbnb that want to expand their business, and they want to take on more properties, and we can match those two together. And what if we built a community, a marketplace of only the best hosts in our Airbnb, people that are basically super hosts with the highest ratings, so you can have the best local hosts match to you, and they could do anything for you. They could either handle the bookings. They could check in guests. They could clean the place.

They can help you design the property. They can do any service that you ask them to do and you negotiate the rate of what they take. So that's the most important piece of news we're announcing. Second, you know, Nicole, we're just always trying to make our product better. And for like the last 20, 25 years, if you went to a travel website, they never know you, right? Like you can type in your loyalty program, but it like it's a search box, you know, ask you how many guests, how many dates, and it never knows you. And we always feel like what if a site could feel like it knows you? What if it took your past trips into account and your profile? And so what we've created are 50 upgrades, many of which make Airbnb a more personalized experience.

So we can suggest destinations. If you're traveling with a family, we'll tell you this home is great for families and this is going to be really great for kids. And hey, if you're searching for six nights in Airbnb, we'll say, hey, if you add a night, it is actually cheaper for seven nights and six nights because there's a weekly discount. So we'll do a bunch of these subtle things to make Airbnb a more personalized experience. And so these are the two things we're announcing. It's part of over 70 upgrades and improvements for Airbnb. I'm really excited about it. I'm excited for you. And you know, you've always struck me as a really thoughtful dude. You think about the why of all the initiatives that you have at Airbnb. So I want to get into that. But first, can you tell me a little bit more about the how? If we can double click on how it works,

who's eligible, how does matchmaking process work? Yeah, it's a great question. So what we do is we vet all co-hosts on the platform that want to become a co-host. You can apply on Airbnb. You need to have experience in Airbnb. You have to have very high ratings. 73% of the hosts are super hosts. 85% of them manage a guest favorite, which are the best properties in Airbnb. So we really try to handpick each of these people so that when you hire one of them, you can feel really confident about them having access to your home and representing you as a guest. And then the rest of it is just very straightforward and self-serve technology where anyone can go on Airbnb.

They can list their property. And as part of the Airbnb setup process, you can be offered a co-host. And we take basically 80 factors into account. The most important factor is where are you located and where's the co-host? Because usually people want a co-host around them. But we'll take about 80 different factors into account to try to match you with the very best one for you. You can kind of sort by different criteria. If you want somebody who's got a lot of experience with, like, cleaning, you want a lot of someone who's really good at communicating with guests.

Or you can just look at everyone who does everything. And then the last thing is then we built these great tools where it's really well integrated. So you can basically message them through the platform. You can hire them through the platform. You can decide through the platform, how much, how, what cut of your earnings they make. And it's all turnkey as compared to what it is now. You know, if you were to hire a third party property manager, it would be like on email or WhatsApp and there are all these separate documents and contracts, and you just really don't really know who you're trusting your home to.

And now for the why. Yes. Why? Why this feature? Is this something that you knew hosts wanted? Did they tell you so? Or did you come up with this internally? It's a great question. Two reasons. Let's work backwards from the customer. internally? It's a great question. Two reasons. Let's work backwards from the customer. So when we started Airbnb, our tagline originally was a cheap, affordable alternative to a hotel. And it's really important that Airbnbs are affordable. And if a city doesn't build housing,

the housing prices tend to go up if more people move to the city. The same thing is true of Airbnb. The more people travel in Airbnb, if we don't add more homes, then the prices go up. So we want to keep Airbnb affordable. We want to make sure guests have a lot of options. So we need millions more homes in Airbnb. So that's the starting point. We want to add millions more homes to Airbnb in the coming years. But we don't want to necessarily do it just through organic growth. We want to bring a whole bunch of new people, homeowners into the Airbnb community that don't have time. And so again, as we interviewed many of these homeowners and these prospective hosts, we asked them, why don't you host? And a couple of years ago, the number one concern was safety. But then we launched this new product, AirCover, which is $3 million of

protection against property damage. And you've got a million dollar personal liability insurance. And that kind of started to address that concern. But people are still describing hosting as a lot of work. And so these people would tell us, I'd love to host, but I just don't really have time or I can't check the guest in because I'm at work and I need someone to check the guest in. And so what people would often do is they either wouldn't host or they go on Google and they type in Airbnb property management company and like Los Angeles property management rental.com would show up some generic like third party service, but then you don't know how good they are.

And unfortunately, the average five star rating for a third party property manager Airbnb is about a 4.62. And the co-host, the average rating-star rating for a third-party property manager Airbnb is about a 4.62. And the co-host, the average rating is about 4.85. So we really wanted to solve that problem. So we really just thought of it as like a Venn diagram. If we just kind of made it kind of more of an overlap, we'd unlock a lot more homes. Guests would have better stays. Airbnbs would be more affordable.

This is the best part is if you have a second home or the house you live in, like let's say you go on vacation and you want to rent your house when you're gone. Now a co-host can manage your home while you're gone. So you don't need a dedicated rental. You can quite literally rent the home you live in when you're there or when you're not there. I mean, we talk about this on the show all the time, making extra money by becoming a host. You're the OG Airbnb host. I'm sure that the co-host network will bring an influx of first-time

hosts to the platform. What advice would you give on being a great host? You talk about this idea of a 10-star experience a lot and then working back from there. So how should they amount in their foray into hosting? I'll give a couple tips. First is on merchandising. It's all about great photos. So I would make sure they have really, really great photos. And if you need help, it even is worth getting a professional photographer or somebody really talented to photograph your home. Whatever you spend on the photos, you'll make up for if you host for more than just a few months. The second thing is until you get reviews, I would discount your nightly rate because I think it's not intuitive, but like travelers, you know, pay for trust. And if you don't have reviews, charge a little less, get the reviews, and then you can command more on a nightly rate. But the most important answer

is the question you asked directly, how do you make sure guests have a great stay? And here's an exercise I did. This is where the 10-star experience came from. I noticed that when you leave a review on Airbnb, and this is also true at Uber, it's a one to five star. And if nothing goes wrong, people often leave a five star. Like in Uber, if you like- The default, yeah. Yeah. You were in a car accident, five star, right? And so then I imagined, what if there was this imaginary six star that guests would leave? What would that look like? And I took one frame of the journey. So I imagine storyboarding the end-to-end Airbnb experience.

And I took one frame of the movie, the most important frame. We call this the moment of truth. It's the moment you check into an Airbnb and you find out if the Airbnb is the one that you booked. And so a five-star check-in is basically the house is exactly as you expected. There was a key code. You tap the key code in, you got in, everything worked just perfectly fine. There were no problems, five-star. So what would a six-star experience be? I think a six-star experience would be that you would walk into the house and Nicole, we'd find out like what kind of food you like. We'd find out you're a coffee or tea drinker and we'd put everything

out and we'd have a little guidebook for you and maybe some like a bottle of wine. And that would be a six-star experience. So what would a seven-star experience be? Well, seven-star experience, we'd actually surprise you at the airport. You'd send me your flight information. I'd pick you up at the airport. I'd drive you to the listing. You'd tell me you're a surfer. If I'm in a beach destination, there'd be a surfboard ready for you. I'd have a surf instructor ready to go. So what would an eight-star experience be? Well, let's take this even further. You get to the airport, and there's an elephant there, and you get on the elephant, and there's a parade in your honor. So what's a nine-star experience? A nine-star experience is the Beatles check-in.

You arrive at the airport and there's 5,000 teenagers cheering and screaming for you. It's total hysteria. And you get to the Airbnb and there's a press conference in the front lawn of your home. So what's a 10-star experience? A 10-star experience, we just take you right to space. The point of the exercise is, this is an exercise anyone can do, where you start from the mundane, you go to the crazy, you can't do the crazy, you can't do the eight, nine or 10 star, but you can do that six or seven star. So imagine, like, what is unique and true to you? I'm not much of a cook or a baker, but I do make chacho cookies. So I call them Chesky's chips. It's a recipe that's been in the family since I downloaded from Google years ago. And so I make them fresh cookies. So the point is everyone should ask themselves, like, what are the

things in their life that are special or different that they can share with somebody else? And the guests may not want it, but at least you can offer it. I also just think like lots of little touches. I think hospitality is in the details. Charles Eames, one of the great designers of the 20th century said, the details aren't the details, they make the design. And the role of a designer is that of a very thoughtful host anticipating the needs of their guests. So I like to just kind of do things that the guest wasn't expecting. And if you can imagine every couple hours, there's a small detail, something you weren't expecting, a little handwritten note, a little this, a little that. I think it's the really small things that make a big difference and really make people feel like they belong in the environment.

A little surprise and delight. 100%. So barring going to space or bringing an elephant or a press conference, what are some of the missed opportunities that you often see people make? There's a couple of really good ones. I think not putting themselves in the shoes of the guest. There's like a towel on the bed and like, okay, there's a towel, but maybe there should be like four towels because you don't want to ask for more towels and you're going to have to reuse a towel every single day. You have four coffee cups and there's a family of four, but if there's only four cups, then they've got to wash the cup every time they drink.

I can pick out a hundred little things like this. So I think trying to just do a little bit more, anticipating needs. Remember people are on vacation and trying to make their life as easy as possible. I think another thing is just be careful of too many rules and like restrictions or regulations. It got out of hand a couple of years ago.

We started seeing people giving guests really long checkout, like literally chores, strip the bed, I don't think anyone should ever ask a guest to strip their bed of their sheets, like, you know, do the dishes, take out the trash. I don't think a guest a host should generally ask this stuff. Now, if you're in a campsite, and if they don't take out the trash, bears are attracted and you can't get to the premise, then that seems kind of reasonable and just make sure they know ahead of time. But be very careful about remembering people on vacation. They're not trying to do chores on vacation. Some entrepreneurs have an instinct to roll out a feature that they think their business would want or need, but their customers don't actually want that or they aren't in touch

in the way that you are. So it falls flat. How do you think through testing these types of features or you being a host yourself and seeing that maybe it would save time to get a co-host or something like that? How do you think about testing new features at Airbnb to ensure that it's worth investing the time? That's a great question. Let me make a confession that for many years, I feel like I lost my touch, maybe before the pandemic, 2017, 2018, 19. There were many products that we launched that just didn't resonate with consumers. And what I realized is that it was partly because the people making the products were a little disconnected from the people we're making

stuff for. And this happens in a big company. You get a company and pretty soon you have meetings about meetings, right? Literally, you're so focused on the company, the organization, collaborating, people's promotions, this thing, that thing, all these issues internally. You kind of forget there's a world outside of the building and that's the reason you exist. And you exist to serve that world outside the customer, not each other. But frankly, a lot of big companies forget that. And I think there was a period where we drifted before the pandemic and we kind of a little bit forgot who we were serving and we weren't really using the product enough. And you lose your touch. It's kind of like a normal person. They sing songs about their normal life and other normal people that music resonates. And then they become really successful and they become detached and they start singing about subject matter that the original audience can't relate to. And they kind of lose relevance and they quite literally become irrelevant. And this is, I think, an analogy for entrepreneurs that you got to build products you want for yourself and you got to make sure

you're still the user. The other thing though, is the way we develop products now, Nicole, is totally different. So we just spend a lot more time and thought building products. We do a lot of research. We created a host advisory board.

A host advisory board is, I think it's around a dozen and a half hosts from different countries around the world that we preview every single new product and feature with. We get their feedback. Then we do a host early access. It's kind of like a beta testing program where we put the features out in hundreds of thousands of host hands. We do the same thing with guests. We also build a lot of prototypes. A lot of people, they like the way they build software is they do this design. They look at it on a screen.

They're like, oh, I'm like that. Now let me test it. And there's a whole bunch of craftsmanship missing, which one might call prototype, building the prototype, using it, living with it, getting feedback. And so these are the kind of things that we do. So again, we build it more with the community and we do a lot more prototyping and more validation of the concept. So you mentioned meetings on meetings on meetings. We have to talk about founder mode. Oh, yes. What a zeitgeisty moment this thing is having. Hold on to your wallets. Money Rehab will be right back.

One of the most stressful periods of my life was when I was in credit card debt. I got to a point where I just knew that I had to get it under control for my financial future and also for my mental health. We've all hit a point where we've realized it was time to make some serious money moves. So take control of your finances by using a Chime checking account with features like no maintenance fees, fee-free overdraft up to $200, or getting paid up to two days early with direct deposit. Learn more at Chime.com slash MNN. When you check out Chime, you'll see that you can overdraft up to $200 with no fees. If you're an OG listener, you know about my infamous $35 overdraft fee that I got from buying a $7 latte and how I am still very fired

up about it. If I had Chime back then, that wouldn't even be a story. Make your fall finances a little greener by working toward your financial goals with Chime. Open your account in just two minutes at Chime.com slash MNN. That's Chime.com slash MNN. Chime. Feels like progress. Banking services and debit card provided by the Bank Corp Bank NA or Stride Bank NA. Members FDIC. SpotMe eligibility requirements and overdraft limits apply. Boosts are available to eligible Chime members enrolled in SpotMe and are subject to monthly limits. Terms and conditions apply. Go to Chime.com slash disclosures for details. So recently I started looking at my wellness routine and I

wanted to see if there was any way I could enhance my results. I looked at my vitamins, and I realized they were not as clean as I had thought. The list of ingredients was long, with things like gelatin and artificial flavors, which obviously have no added value and can cause some digestive issues. After doing some research, I came across Vimergy. Vimergy makes liquid vitamins and supplements that use clean ingredients and are not loaded with unnecessary fillers and binders like citric acid. And because they're liquid, they absorb faster than tablets, gummies, and capsules. And they're much easier to take if you have difficulty swallowing your pills, which I always have. It's a whole process. I've tried putting the water in first and then the

vitamins and I don't know, it's just blech. And unlike multivitamins, you can actually customize your vitamin routine so you only take what you need and nothing you don't. They're honestly so easy to integrate into my day. I just add them into my morning juice or smoothie and at night in my tea before I go to bed. Right now, Vimergy is offering my listeners free shipping using the code MNN, and you can save up to 12% with their Mix and Save program. That's Vimergy.com, V-I-M-E-R-G-Y.com with code MNN, as in Money News Network. Try them today. I can't wait to hear what you think and more importantly, how you feel. And now for some more money rehab. Okay, so Ryan, for those who missed it, the Y Combinator speech that you gave,

the Paul Graham piece, all of it, what is founder mode? So it is really, really funny because founder mode is something Paul Graham coined, not me. It's based on a talk I did. If I can just give a little bit of backstory to answer your question, here's the best way to describe it. I had no idea when I became CEO of Airbnb how to become a CEO. I don't think anyone knows. Who does? Yeah. Exactly. Here's the funny thing I like to say, Nicole. I think you can be born a great founder, but you can't be born a great CEO. In other words, no one told me how to be a tech founder. And I kind of figured it out. And I was pretty good the day I started. Hence Airbnb. We made mistakes, but it worked out, obviously, and it grew really quickly. And so there are people that are good

founders right off the bat, because I think being a good founder doesn't require experience. But being a good CEO is to be a good leader. I just don't think leaders are born, they're developed, and they're developed through trial and error. And many of us even have made so many mistakes. And so one of the big mistakes I made was I thought what you do as a CEO is, you know, you used, I used to build the product and I thought it was my job to now hire people to do the job I used to do. And that sounds right on the surface, but I thought you hire great people and you get out of the array and the better they are, the less in their way you should be and the more authority to operate or whatever like business school term you want to use. And you basically get further and further from your team and your people and you're less in fewer of the details.

And this seems like a good idea. And it becomes devastating to an organization over time because the big lesson, and this is what founder mode means, is that leadership is presence, not absence. That just because you're present, and you're very, very involved, doesn't mean you don't trust your team. And it doesn't make you a micromanager. A micromanager is somebody who's in the details and just blindly telling other people what to do. Often people who know more about the subject matter than you do. A lot of founder mode was derived from my observations of Steve Jobs. Steve Jobs said he wanted to have the world's biggest startup. He wanted to have a giant company that felt small.

And that meant he needed to be functionally organized. He didn't have any divisions. He didn't have general managers. Everything ruled up to him. And he was in all the details. But he did not ever think of himself as a micromanager. And I've asked people who worked for him, was Steve Jobs a micromanager? And this is what they said. They said, no, he wasn't a micromanager because he was in all the details, but he didn't tell us what to do. He asked us what we think we should do. And we partnered and we would debate and argue, but it was truly a partnership. And I think that is what the founder mode is. It's about this idea that founders are in the details, and then they're told to let go of the details. They're told to let go of their company. And what ends up happening is there becomes a leadership absence. And founder mode is about more present leadership. That is at the simplest what it is. And it's not exclusively something founders could exercise. Every leader in business, in government, in a nonprofit, a community organization could have more leadership presence. It's not some exclusive founders. It's just a little more germane to founders,

because you were in the details in the first place. A lot of founders are told at all levels, once they raise money or once they reach a certain level of success, to bring in grownups to scale this thing. It's a terrible term, by the way. Right? And you tried this. I was told to do that. Right? It didn't work. And listen, you do want to bring in seasoned leaders. And at certain scale, you want to bring in executives. You don't want to bring executives when you're 10 people, but there is a stage where you want to bring in, you know, like you can call them quote unquote grownups. But the reason I don't like the term grownups is first of all, it presumes that you aren't a grownup and there's

something like infantilizing about bringing in grownups. And when the grownups come in and they think they're grownups, they think it's their job to manage you. You know the number of founders who hire executives and the executives think it's their job to manage the young, inexperienced founder? And that is BS. No, the person who writes the paycheck is managing the other person. The founder, even if they're younger,

is still managing the executive team. And the founders often find themselves apologizing for how they want to run the company. And the founders are often find themselves apologizing for how they want to run the company. And they bring in executives and executives tell them how to run the company because this is how they ran at their company. Oh, and by the way, I'm really senior and I want authority and I want decision-making rights. I remember I had a leader come to me one time and I think they said this with good intentions. I was like trying to work with this person's thing and they were like disturbed. And they were like, is this your decision or is

this my decision? That summarizes everything. And I said, it should never be either. It should never be either. I said that. I said it should never be either. And what I meant was that we are partnering. And if you think it's your thing or my thing, that's the problem. And so I'm in the details. I'm on the field with people, but it's not just my decision. I mean, yes, I do make the final decision, but I rarely am unilaterally deciding something my team doesn't agree with because if they don't agree with it, there's probably a good reason for that. So that is to me what it is. Here's another example. Most founders are engineers or a tech company or designers, or they're really good at marketing, but they know how to make something. Hence, they started the company. And so they were the chief product officer.

They were the chief brand officer. And as a company grows, they cease to be the chief product officer. They cease to be the chief brand officer. And so they go from spending their time doing something they're good at, product and marketing and brand or whatever they were good at, to now being told to focus on something they're not so good at, like capital allocation and strategy and reacting to problems. And it's actually not their strength. And so I think a lot of founders are asked to play a game that is not benefiting the company. It's not natural to them. And one day they wake up and they don't even recognize their company. It's a company that's bureaucracy. There's a lot of politics. They

basically abdicate responsibility to these executives. The executives then leave. And so then now they're stuck pursuing the strategy of a departed executive. And the new exec comes in, they want to change the strategy. And you're like bewildered. You're like, wait a second. We we you told me to go north. So I've been going north for the last five years. Now I'm told we should have been going south the entire time. So ultimately, the right way is one way and one way is your way, your way as a leader. Now you got to be curious. You got to be learning. You shouldn't be a tyrant. You shouldn't be just autocratically telling people what to do. It's not a license to be a jerk. So there's always a pendulum here. But

I think that that's not the problem. The main problem once a company gets traction is founders are systematically, unintentionally marginalized from their own companies. And that's to the detriment, not just the founder, but the company. And so they need to get back involved. They need to become present again. Great leadership is presence, not absence. And they're not doing the thing that made them successful in the first place, like their thing that they're great at.

So how do you balance being in the details, but then also scaling? It's a really good judgment call. Here's an analogy. I'm not much of a golfer. I'm very bad at golf, but I've done a couple of golf lessons. And when you do golf lessons, there's an instructor and you practice a swing and they're literally watching you after every swing. And you practice a swing and they're literally watching you after every swing.

And what you don't want to do is learn golf without a golf instructor and then develop a bad swing. Do that thousands of times and then you get an instructor and they got to correct your swing. And it's like muscle memory. And the same thing is true of a company. So here's the general philosophy. I would start very involved in the details. If you have a new leader, I would work closely with them. And like a golf instructor, I would let go over time once the organization develops its swing. So start extremely hands-on and let go over time. And this is opposite of what everyone's told. Everyone's told to hire someone and just give them room. And what happens is over time, they realize things aren't going the right direction and

then they get hands on. And if you start hands off and get hands on, now the executives think they did something wrong. Now their confidence is shaken. They feel second guess. They feel like there's been one expectation. Now there's another. So I would tell a founder, be in as many details as you can, but not more.

So I would tell a founder, be in as many details as you can, but not more. Start in the details. And when you develop muscle memory of the executive organization, then you can let go and give ground grudgingly and slowly. I really like the way that you're reframing this idea that being a micromanager is a negative connotation, but being in the details is a euphemism that is considered positive. And this happens a lot in business. Somebody might say they're too sensitive, but really, you could reframe that as being empathetic and understanding people in teams. And so there's a lot of things that do a lot of crap that you got as a founder that you can reframe as a compliment or as an

asset instead of a liability. You know, Brian, something that really resonated with me in hearing you talk about this is that being a founder is like being a parent, that you can discipline and make decisions in ways that others might not be able to. So many entrepreneurs describe their business as their baby. What do you think about that? Do you think of Airbnb as your baby? As much as I could think, I've never had a baby. So ask me if I have a baby, if I felt like they were similar. But yes, I do. And I do have two co-founders who have children. They said, yes, this is another kind of child. The difference in Airbnb is it's like a child that keeps growing, but never quite grows up. And so imagine you have a baby that one day weighs 100,000 pounds, but it's still a baby. But it's still a baby and it needs to be cared for. And it just doesn't ever quite grow up and become independent. So that's what it is. But the reason I made that reference is there's a couple of things that are different about

founders to non-founders. Number one, a founder has the moral authority. Like a founder could rename the company, right? You imagine a professional manager coming to a company and renaming the company, they would feel like they don't have the permission. And not that you should rename the company, but it's a good proxy. Do you have the permission to do that? And if you can't rename the company, you probably don't have permission to reinvent the company.

And all companies at some point probably need to be reinvented. So that's the first thing. The second thing is the founders have the passion, right? Like it's theirs. And there's something different about it being yours, where I remember an entrepreneur told me once, the founder is the upper bound of how much anyone in the company cares. No one's going to ever care more than the founder. And the more you care, the more everyone else cares. No one's going to work harder than the founder. The harder you work and the faster you work, the faster everyone else is. So you're a pace. You're a pace of passion. You're the standard for quality. You're the standard for speed and intensity. So that's

the second thing. And I think founders are unique. The third thing is founders have the skill set. If you're a professional manager, you often came into a large organization and you came in through a function. Maybe you were a finance person, engineer, a marketer, any track, customer service. And so what ends up happening is you tend to bias towards the area you're comfortable with. If you're a founder, you were a generalist. You were doing everything. Every job in the company you did before them, even though you might have done it worse because you were a generalist, you understand the job. And so you have the generalist. You were doing everything. Every job in the company you did before them, even though you might have done it worse because you were a generalist, you understand the job.

And so you have the skill set. You know how to create something, so you know how to recreate something. You know how to create something new. And so these are the three reasons, the moral authority, the passion, and the actual skill set to build and make that I think really means that the best company, I think there's an indisputable statement. Not all founders should run their companies forever. Not all founders are better than the non-founders. But the best companies in the world are founders who scale. And we see this through history, from Henry Ford to Walt Disney to then Steve Jobs, Jess Bezos, Elon Musk, you can go down the list. But Jensen Huang, like all the transformational stories,

like 90 something percent are founders continuing to run their company. There's something special. Well, you tweeted or X'd. Can I, can we just say tweeted? Yeah, just say tweeted. Right. You tweeted about the idea that founder mode is not the same for female founders. Yeah, just say tweeted. We know that it's different for female founders. I don't think that's disputable. It just is. So in a world that female founders are treated differently and have different expectations,

how can female founders do founder mode now? Yeah. I mean, let me just say. Hold on to your wallets. Money Rehab will be right back. And now for some more Money Rehab. How can female founders do founder mode now? Yeah, I mean, let me just say, you know, the founder of The Wing is a friend of mine.

Founder of Bumble is a friend of mine. I have an ex-girlfriend that was an entrepreneur. I know a lot of different people. It's a very small world. And before I answer this question, let me just say this. If you want to make the world more equal and you want to lift women up, one of the best things you can do is empower women to be entrepreneurs and support them. It just makes complete sense. And I think that we could do more to support women entrepreneurs. And one of the things people say is, oh, women need to have an easier time raising money. So we should have more female partners at investment funds.

And that's very true. But there's something we don't talk about, which is that women are oftentimes not allowed to be in charge the way men are. You're not given the same authority. And this is what I think ended up happening during 2019, 2020, 2021, 2022, there were dozens of women that were pushed out of their own company or pressured to step aside for infractions that their male counterparts weren't pressured. Like let's take Audrey Gellman, for example, was pressured over claims of discrimination, but Airbnb had discrimination claims on our platform. I

wasn't pressured to resign. And so I think that it doesn't abdicate the responsibility of the founder or say that there were things the founder shouldn't have worked on. It just means that women should not be held to a higher standard than men. They should be held to the same standard as men, and they should be given support. And one of my slight nervousness about founder mode is, will people tolerate a woman being as assertive as a man? Because part of founder mode is telling people ultimately what to do. You should listen to them. You should seek buy-in, but at some point you need to make a decision. You need to tell people what to do. And the best thing we can do for when founders is to tolerate them operating

the way we tolerate men to say that is not a male quality. That's a quality of a great leader. And women should be able to exercise those exact qualities that men are exercise. And they should not be on thinner ice. They should be held to the same standard, but not a higher standard. And we should allow them the same authority to operate as men do. And by the way, that just doesn't just benefit women. That benefits everyone. Because if you do that, you're going to double the number of entrepreneurs in the world. You also did founder mode with friends. You started the company with your buddies, Joe and Nate. There are probably more disastrous co-founder stories than not, like breakup stories and

things like that. How did you guys figure this out? So I'm on the board of Y Combinator. And the number one reason startups implode is co-founder disputes. Either the founders are fighting misalignments or like a founder is not pulling their weight. But Paul Graham used to have this saying, Paul Graham is the founder of Y Combinator, he said, startups die of suicide, not homicide. You're not killed by the market. You're often not even killed by not raising money. It's just internal dysfunction. So this is such a good question.

I think starting a company with friends is a good thing. And the reason why I think it's a good thing, a lot of people say, oh, don't mix personal and business. I think you should. Like, I think you shouldn't. I don't, maybe you shouldn't hire family members. Maybe that's the line, but I think you should hire your friends. And I think a lot of the great startups were two friends that like started a company together. And the reason why is when you start a company and your co-founders, there's going to be so much stress and pressure on the relationship that the relationship needs a really strong foundation of trust and mutual admiration. And that often is rooted in friendship. Not always. I mean, you don't want, if it's the friends and the friends don't respect each other,

and maybe those aren't good friends in the first place, but you really want that foundation. And the lesson, there's two things I did with Joe and Nate that have kept us together all these years, because the number of companies where there's three founders and no one sued each other and like no one's fought and no one's done a tell all book. It's like, it's, there should be more stories than there are. And I totally get why this happens. You add a lot of money, power, change. You know, oftentimes one person

becomes kind of the face of the company. It's hard to have two or three faces and this creates tension. So there are two or three things I did in the early days and I still do to the day. The first thing is Joni and I never tried to prioritize being right or winning an argument over the relationship. Let's say you have to make 10 decisions a day. And that's not crazy for a startup. I mean, they might be small decisions,

but founders can argue over the smallest things, like literally the smallest things. Sometimes the biggest fights are over the smallest things. If you make 10 decisions a day, Sometimes the biggest fights are over the smallest things. If you make 10 decisions a day, that's 3,000 decisions a year. That's 30,000 decisions a decade. Can you imagine the sheer opportunities for arguing? And if you win an argument, the person's pissed off. And by the 50th argument, you just can't stand each other.

So you always need to make sure that no one argument prevails over the relationship. And so you have to have a little bit of a healthy detachment and perspective to say, you know what, I know we're arguing over this, but there's about 10,000 more things. So that's number one. Number two is communication. There's this old saying somebody once said to me once, I love the saying, the absence of information is filled with dirt. And I think so many people break up over lack of communication. And I think communication is almost like, it's like being in the middle of the ocean.

You got to work hard to stay above water. Otherwise, you're at some point going to fall to the bottom of the ocean. So you've got to work hard at communication. And a lot of people say, oh, we have a great relationship, but we never talk. Well, then I guess you don't have a great relationship. So one of the things Jonay and I did is we have a standing one hour or 30 minute call every week. And sometimes it gets canceled, but we've been doing that for 17 years. I think that's really important.

There's some others, but those are the two big ones. Yeah, I think those are good decision making systems and frameworks that you guys have put into place that have obviously been really successful. If we can step back and rewind when you guys were starting and help entrepreneurs who are starting out with some money rehab, because while innovation and vision are big parts of founder mode, personal finances, less of a sexy part, but an important part of entrepreneurship too. Before Airbnb hit its stride, did you have an emergency fund in case the business didn't pan out? Did you funnel your life savings in case the business didn't pan out? Did you funnel

your life savings in the company? What would you tell somebody who's just starting out? There's always a risk that whatever I tell people will assume like they should do. And so I'm going to, I'm going to tell you what I did, but let me qualify by saying, I don't think people listening should do this. It just kind of worked out. So like all's well that ends well, I did not have savings and not only did I have savings, but I basically burned all the ships. Here's the thing. If you're young, you don't have a family, you're like in your 20s, you have limited responsibility, then I think maybe this makes sense to like burn the boat, so to speak,

and to like put everything into the company because you don't have a lot. So you don't have a lot to lose. But I think that becomes really, really perilous for obvious reasons when you are older and you have more responsibility and you have a family. And I do not recommend anyone do that. So I think I was a little crazy. I mean, to give you an example, not only do we not have any money, we funded the company on credit card debt. We had those like, you know, in like growing up, I'm kind of maybe dating myself to a younger audience. But when I was a kid in the 80s, kids had like baseball cards and they had these plastic sleeves that you could put baseball cards in these ring binders. Well, we had one of those three ring binders, those plastic sleeves.

Instead of putting baseball cards in them, Joe and I put credit cards in them because we were funding Airbnb with tens of thousands of dollars of credit card debt. We just get like a credit card or have a $5,000 max. We'd max it out, go to the next credit card. Now, it all worked out because we eventually got traction. We were able to raise venture capital. We were able to pay off our credit card debt. But I would probably be careful about doing that. I think if you're super passionate, I think the most important thing you can invest is your time. And I would try to put in as little money as possible. I think entrepreneurs raise too much money. I think entrepreneurs spend too much money. I think they probably put themselves too much in debt. And I think that, you know,

if you have trouble raising money, it might be because there's a problem with the concept. In other words, if you cannot get people to share in the financial risk of the company, then that's a sign that like you still have more work to do. Well, you guys have had incredible highs and lows. I mean, we don't need to go back to 2020, but you took a huge revenue hit there. Then you had an amazing IPO. How do you manage these extremes? I mean, going through these stressful periods of time in business and finance, how do you protect your mental health? Do you still draw? I do. I do. Is that part of your mental health? It is. I remember when I was growing up, my dad told me like something really bad happened. And he told me something I'll never forget. He said, Brian, things are never as good as they seem or as bad as they seem. And that's true,

right? Except for like that one day a year where things were exactly as they seem every other day, they were either better than they seemed or worse than they seem, but they weren't right. And so you have to remember that. And you sometimes have to tell yourself when times are good. Here's another version of it. I remember when I was starting Airbnb, I met Jeff Bezos, and I was starting to get a lot of accolades. And I was on magazine covers. And he said, Be careful. Today's poster boy is tomorrow's pinata. And he was right. You know, and you go through phases. You have good days, you have bad days.

And I think the thing to remember is to always tell yourself to have perspective. The things aren't as good as they seem. They're not as bad as they seem. They weren't as good three months ago as they were when you thought they're rotting on top of the world because if they were, why are you here now? But remember that you're going to get through this as well in your best days in your life are in front of you, not behind

you. And I think, you know, that would be the first thing. I just call that perspective. The second thing is just health. You know, people that don't sleep are going to be a lot more agitated and moody. People that don't eat well and their health physically deteriorates are not going to be able to handle this. So I think we used to all like in the last decade, glamorized sleep deprivation, for example. I think everyone's now talking about sleep health. And I don't think you need to deprive yourself of sleep every night to be an entrepreneur.

I think I was probably successful in spite of not sleeping, not because I wasn't sleeping. I don't think it made me more productive. I think I just thought I was more productive, but I was probably less productive. But I think the number one thing is the next thing I'm going to tell you, which is starting a company is really lonely. It's really lonely. You know, that old cliche, it's lonely at the top. And I never really knew what people meant. And I now understand how lonely it can be. And the journey, the more success you get, the more lonely you tend to get. And you've got to fight against that isolation. You've got to fight against that loneliness. And so there's a few ways to do that.

I think when people hear loneliness, they assume, oh, I need to have a partner, like a romantic partner. And that's only part of the problem. Frankly, some of the loneliest people in the world are married. So that's not a full solution. You need to have friends. And I think you need to have like, you know, you pick the number five, 10, 15 friends, but you need people that if you call them, you don't have to get them up to speed. If you get them up to speed, you're not maintaining the relationship, that you can confide in them. And you can't really confide in somebody you don't maintain a relationship with, because it's kind of weird to drop something on somebody you haven't talked

to in a while. So I think those friendships are really, really important. And if you're a founder, I would recommend making friends with other founders, because they'll make you realize you're not so crazy after all, that what you're experiencing is not a solitary experience. Maybe you're all crazy. Yeah. Like we're all crazy. We're all in this together and we're all crazy together. And somehow there's some camaraderie that I think ensues when you come to that realization.

I know your mom, who's a social worker, told you to optimize for money in your work. She was disappointed you went to RISD to pursue art because she thought that that was maybe the only job that would pay less than social work. Yeah. My mom was a social worker. My dad was a social worker. My mom told me one day growing up, I chose a job for the love and I got paid like not a lot of money. She used to choose a job that pays you a lot of money. And one day I said, mom, I'm going to become an artist. And she goes, oh my God, I did not think there was a profession that paid less than social work, but I think you found it. And I said, no, I promise mom, I'm going to one day make money. And she says, and I'm going to go to art school and go to design school. And she goes, oh my God, if you go to design school,

you have to make me a promise. I said, what's that promise? She said, you got to promise me that you get a real job. I said, what's a real job? She goes, a real job is the job that has health insurance. Cause you know, you got to, I'm like, a real job. I said, what's a real job? She goes, a real job is a job that has health insurance. Because, you know, I'm like, okay, fine. I'll get this real job of health insurance. So I graduate from the Rhode Island School of Design, design school in Providence, Rhode Island I went to. And I got a real job of health insurance.

And I had that job for two years. And I remember two years into the job, I was there just long enough to become miserable. And I could realize it was almost like I was in a car. This is a metaphor. And I looked in front of me in the windshield. And the road in front of me looked exactly like the road behind me. And I said, if I don't make a change, this is the rest of my life. And I thought to myself, this is not my life. I'm meant to do something different. In one day, in October 2007, my life changed forever. Because I get a call from my friend at RISD, Joe, and he tells me, Brian, come to San Francisco. Let's start a company. And

I have this impulsive moment where I go into work, I quit my job, I pack everything in the back of an old Honda Civic, and I drive up to San Francisco. I get to San Francisco, and Joe tells me the rent is $1,150 and I don't have enough money to pay rent. Well, it turns out that that weekend, an international design conference was coming to San Francisco and all the hotels in San Francisco sold out. And that's when the idea, we said, well, what if we just turned our house into a bed and breakfast for the design conference? Unfortunately, I didn't have any beds, but Joe had three airbeds. We pulled them out of the closet and we called it airbedandbreakfast.com. Now, if you told me that weekend that I would tell that story 3,000 times and that company would generate more revenue than

the GDP of Croatia, which is true, I would have thought you were crazy. But I think there's a number of lessons there. The first lesson is don't take career advice from your parents. Your parents love you. I think you should take like life advice from your parents about how to be a good person and maintaining relationships, but don't take career advice from your parents. And the reason why is your parents want to protect you, but they protect you by analogy. They say, well, lawyers have always been a stable job, so you should become a lawyer. And now AI is replacing a lot of what you need a lawyer for.

So your parents might tell you to go into something because it was always stable, but it's about to become an unstable field anyway. So I don't think you should take career advice from your parents. The second thing is I do think you should take big risks growing your life. A lot of people, like, they want to defer risk to early in your life. A lot of people, like they want to defer risk to later in their life. And Pablo Picasso had a saying, the older you get, the stronger the wind gets

and it's always in your face. The younger you are, the most possibility you have. You can start a company at any age and the best day to start a company is today. And today is always better than tomorrow. And I think you don't need experience

to start a company. And that's almost like a contradiction. I don't have an experience to be an entrepreneur. What does that even mean? Entrepreneurship is inherently a field of inexperience. And the best way to get experience is to start doing it that day. And so I think that's the second thing. The third thing is I do think starting companies with friends and not trying to do it on your own is really great. And then the fourth thing is I would do something you're passionate about. I would try to solve your own problem. And don't worry that it's a big idea. I mean, I got to tell you, renting three airbeds for a conference didn't seem like a big idea. It didn't seem like a hundred billion dollar idea at all. But if you can solve a problem in your own life

and you're kind of like other people, then you might just have solved the problem for millions of other people and they're going to pay you for that solution. So these are, I think, some lessons. And my mom, I think, would agree with me now that not that she's glad I didn't take her career advice. But you have health insurance. I do have health insurance, luckily. And I really showed my mom because now I provide health insurance for other people. That's awesome. Do you take care of them? Yeah, to the extent that they want me to, I do. And I've been incredibly fortunate financially. And I spend money, but I spend a lot of it on other people. I live in a 2400 square foot house and I own one house and I don't own

like boats or planes or anything. So my lifestyle is not modest, but it's not crazy, at least for a tech founder. But I where I do indulge is in experiences with other people. I take these epic Airbnb vacations and I bring my friends and my family and I try to try to show them a great experience. And I try to help friends and family the extent I can, experience. And I try to help friends and family to the extent I can, where I can. And I think it is quite true that you often get more joy from giving than receiving. And of course, you don't really know this until you do it. And from experiences, which is what everybody says. I mean, think about it. You're at the end of your life. What are you going to remember? You're going to probably remember the people you love and the experience you have with them. Brian, we end all of our episodes by asking our guests for

one tip that listeners can take straight to the bank. What's one thing that you've done with your money that's helped your overall financial health? It could be anything in the realm of budgeting, saving, investing. Whatever you don't account for gets out of control. I learned this at Airbnb. When you look at your finances and you spend a lot of time with it, you'd become more literate and you become more sensible. So for example, a company that doesn't have a CFO, a company that doesn't have a rhythm of looking at their financials, they tend to lose discipline. And as they lose discipline, their decision-making quality goes down. And so I think it's helpful for everyone to be on a budget, even if you don't need to be on a

budget. A lot of people are on a budget because they have to be. But even if you don't have to be, the rigor of being on a budget means that you're mindful, that you're intentional. And I think that all businesses need to operate off budgets. And if a business needs to operate off a budget, why wouldn't a person operate off a budget? And I think part of operating off a budget is having a regular rhythm of looking at your budget, looking at your spending and just paying attention. So, you know, back to founder mode, founder mode is about being in the details. I think being in the details of your spending and tracking everything, anything you're not paying attention to, it's never good. And it always feels worse than it is. You suffer more in imagination than in reality.

I agree. Money Rehab is a production of Money News Network. I'm your host, Nicole Lappin. Money Rehab's executive producer is Morgan Lavoie. Our researcher is Emily Holmes. Do you need some money rehab? And let's be honest, we all do. So email us your money questions, moneyrehab at moneynewsnetwork.com to potentially have your questions answered on the show or even have a one-on-one intervention with me and follow us on Instagram at moneynews and TikTok at moneynewsnetwork for exclusive video content. And lastly, thank you.

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