Airbnb CEO Brian Chesky on the company's expansion beyond vacation rentals

My next guest is a business leader who is all too familiar with the trend of travel cutbacks, the CEO of leading vacation rental site Airbnb. Brian Chesky joins Top Story tonight. Brian, thank you for being here. Thank you for talking to us. You deal with Americans every single day who are trying to spend money. What is the state of the economy right now? Well, I can't speak for the entire economy, but I can speak for the economy of Airbnb. And it's quite resilient, and it's actually quite strong. What we are seeing is that there's more last minute travel. So there's fewer people are pre-booking, although we do have a feature called Reserve Now Pay Later, so maybe that's offsetting it. But in Milan for the Olympics, initially we thought bookings would be down. It just turned out people pushed the bookings back. We're now expecting for the World Cup to have the largest event in Airbnb history. It's in 17 cities in three countries, and we're actually expecting a lot of travel. So maybe perhaps counter to the broader narrative that we're actually seeing pretty healthy growth in the United States. Brian, but at the same time, I know your business is expanding here, right? You guys are doing stuff like groceries. You're trying to find new clientele in other spaces. If business is so good, why are you trying these other spaces? Well, you could say that's because business is so good and we can expand. People want more from Airbnb. We spent 17 years or 16 years being kind of just one thing for people, which is a home, but our guests have told us that they want more. They said they love our homes. They love kitchens in their homes, but they like to have groceries in their ride. They say sometimes Uber is not as reliable in some cities and they want someone to pick them up at the airport. They say they get to a city early. They don't want to carry their luggage around. They want luggage storage. They want to rent a car. They want to do it through Airbnb. Some people say, hey, I'm on Airbnb, but I want a boutique hotel so we can offer that. So we're really responding to what people are asking for. Yeah, no, it's great. That is true. Sometimes when you get to Airbnb, it's nice to have the groceries already there. Take us back to the beginning, right? How did you convince people to sort of open up their homes and rent them out? Well, the history is important. We started in 2008 during the Great Recession. And so that was probably a clue that many people were struggling to pay rent. They're struggling to pay their mortgage. They were losing their homes. And ultimately, I think a lot of people turn to Airbnb to earn extra income. I mean, I started the company with my co-founder because we couldn't afford to pay rent. A design conference came to San Francisco. All the hotels were sold out. We didn't have any beds. We had three airbeds. We pulled them out of the closet. We called the airbed a breakfast. So I think, you know, the other point is rising inflation may also attract hosts. And we're seeing a lot of people becoming hosts. And the fastest growing demographic of hosts are Gen Zers, young people. A lot of young people are becoming hosts. Maybe it's because there's economic uncertainty. There might be other reasons why. So I think economic uncertainty attracts a lot of people to want to find new ways to make supplemental income. And hosting is a great way to do that. Are you using AI right now? How is it part of your business? It's kind of top to bottom we're using it. And it augments people for the most part rather than replacing them. 60% of our code is now authored by AI. But engineers work with the code and they're prompting it and they're checking it. Our customer service, you know, 40% of contacts are now resolved by AI assistant. This isn't as we replace the people, but allows our human agents or real agents to be able to handle more complex topics and more trust and safety incidents. Many of our features we announced, we now use AI to summarize information. There's a billion reviews in Airbnb. That's a lot of reviews to read. AI can summarize them and point you to the right reviews. So I think of AI as something that amplifies Airbnb. But ultimately, you know, Airbnb is a deeply analog idea, you know, traveling, staying in the real world, meeting people, having memorable experiences. This could have existed a long time ago and will exist a long time from now, irrespective of AI. You made some recent headlines when you warned that pure people managers will not survive the AI era. Explain what you meant by that. And do you see AI taking any more jobs at your company? Yeah, what I meant by that is that, you know, at a lot of large companies, there are layers of middle management that aren't close to the work, and their job is to manage people. And in the future, of course, there'll be people managers, but a pure people manager, as in somebody who's not steeped in the work, is not going to be as valuable. The reason why is the following. A lot of managers' jobs were communication. They were coordination. They were moving information throughout the company. The AI now moves information faster than people. So ultimately, you want people to be closer to the information. Additionally, managers aren't just going to be managing people, they have to manage agents. And so I think you're going to see these hybrid managers of managing people and agents. And so people are calling them like player coaches. And so ultimately, I just think all leaders got to be a little more hands-on and manage not just the people, but manage people by managing the work that the people do. Now, this is probably, if you work at a small business, you would probably have no idea what I'm talking about. If you're in a large corporation, thousands of people, you probably know what I mean. And ultimately, I don't think this is necessarily bad for people. If they're willing to get their hands dirty, willing to use AI tools, I think they'll be okay. As far as will AI replace jobs at Airbnb, I think it will replace tasks more than replace jobs. And I think most of the people's jobs will change. I don't know anyone's job that won't change. My job will change. But I do anticipate that people will remain having jobs. They're just going to have different jobs than before. But I expect us to be hiring a lot in the future. Congress, as you know, is investigating a number of companies that are using Chinese AI models. Does your company use Chinese AI models? And are you concerned about data privacy? Three things. Number one, yes, I'm concerned with data privacy. Privacy and data security is one of the most important things at Airbnb. I think we have a great track record of data privacy and security. Privacy companies rate us very, very highly. That's number one. Number two, I've said in the past that we have used open source Chinese models. But here's the key. All data is vaulted and secure. No company or country has access to Airbnb data. It's vaulted. With regards to what we're currently doing, I'm in direct contact with the Congressional Committee. And I promised, we've said that we would like to be in direct contact with them and answer all their questions one-on-one directly before we answer questions publicly. So I will definitely comment more after they had an opportunity to hear from us. And I want to cooperate and I want to tell them everything we're doing. Are you finding that AI, that Airbnb, I should say, the growing sector in Airbnb, is it still sort of private homeowners, or is it people that want to use Airbnb as an investment model, or even large companies that said, listen, wow, you can make a profit off this? It's still primarily individuals. Let me give you some stats. Eighty-seven percent of hosts on Airbnb, that's five and a half million, eighty-seven percent have one or two listings. The number we asked people, what is your profession if you're not full-time? One in four people are retirees. The other top five job occupations are, I think, healthcare, government workers, manufacturing, healthcare, and I think retail. So those are the top professions. Now, there are property management companies, but it's overstated. Another thing that's overstated is how many Airbnbs are in a city. We surveyed people, and the average person thinks around 20 percent of the homes in a typical city are on Airbnb. In most places, it's like one to two percent, and many of them are people renting occasionally. So I think Airbnb is not as big as people perceive in their own city. That's just what the data says. Before you go, I'm just curious, what's the craziest Airbnb you have ever come across or heard of on your site? Well, there's a lot of them. The dog B&B, which is a giant dog that you stay in, you enter through the rear, and you sleep in the mouth. That's pretty unusual. Somebody built a giant potato in Idaho that you can sleep inside of. I guess Airbnb, you can get the traditional, and you can get the unique, and there's some never imagined on Airbnb. Brian Chesky just gave me some ideas for our next family vacation, so I thank you for that. We thank you for joining Top Story and answering all our questions. Thank you very much.