I am absurdly lucky even to be writing this email. Ten years ago we started Airbnb. Joe and I couldn’t pay rent, so we created the first AirBed & Breakfast and invited three people we’d never met to stay in our home. People said our idea would never work – “Strangers will never trust one another!” A decade later, people have checked into an Airbnb nearly 300 million times.
I was thinking about the next ten years of Airbnb when I received a phone call I’ll never forget. A close advisor told me that now was the time to “institutionalize your intentions so that even as you grow, you can minimize what conflicts with your vision.” It made me realize that we should write down what we want to institutionalize before it’s too late. So I asked myself, if Joe, Nate and I were gone tomorrow, what would we want the world to know about Airbnb’s intentions?
Airbnb is still young, and the cement hasn’t hardened. We are now big enough where anything is possible, but not so big that change would be nearly insurmountable. We can still be radical, and it couldn’t come at a more perfect time in the world. People are increasingly living in digital bubbles, trust in institutions is at a record low, and companies realize they have a greater responsibility to society.
It’s clear that our responsibility isn’t just to our employees, our shareholders, or even to our community – it’s also to the next generation. Companies have a responsibility to improve society, and the problems Airbnb can have a role in solving are so vast that we need to operate on a longer time horizon.
Technology has changed a lot in my lifetime, but how companies run has not. Companies face pressures based on legacies from the 20th-century, and the convention is to focus on increasingly short-term financial interests, often at the expense of a company’s vision, long-term value, and its impact on society. You could say that these are 20th-century companies living in a 21st-century world.
We want to design a company to meet the unique needs of the 21st-century. We want Airbnb to be a 21st-century company with two defining characteristics:
- We will have an infinite time horizon.
- We will serve all of our stakeholders.
I know that a lot of companies are thinking about being long-term oriented, but an alternative way of thinking about it is being infinite. Being an infinite company is an idea that my friend, author Simon Sinek, has been discussing with me. Simon explained that a company’s purpose is to advance its vision, and since a vision is a mountaintop you never quite get to, you should have an infinite time horizon. But many companies are designed to be finite. Finite companies are focused on beating their competitors and appeasing short-term interests. But business is not finite. Unlike sports, there is no time clock, so there can be no winning or losing – there is merely surviving and innovating to endure. This doesn’t mean that meeting clear goals isn’t important or that you should lose your sense of urgency and avoid tough decisions. Short term success is still important so long as it advances your vision. As Simon put it, it means that your focus should be on getting to the mountaintop, not the rest stop on the way up the mountain.
We think that a company should survive to see the next century, not just the next quarter. A 21st-century company should eventually become a 22nd-century company. By having an infinite time horizon, a company can be more audacious, take more responsibility for what they make, and create more lasting change.
- We are instituting many actions to begin to put this ideal into practice, starting on February 22, where we’ll be announcing the next chapter to empower a host-led world with some substantial improvements to our service that set us up for an infinite time horizon.
What is the purpose of a company? I would say its purpose is to realize its vision. But even this is no longer enough. We must realize our vision and ensure our vision is good for society. This means that we must have the best interest of three stakeholders in mind: Airbnb the company (employees and shareholders), Airbnb the community (guests and hosts) and the world outside of Airbnb.
To be a 21st-century company, we must find harmony between these stakeholders. For example, Airbnb the company must remain values-led, leading with boldness and compassion, while also building a highly valuable business. Airbnb must treat hosts in our community as partners and make guests feel like they belong. All the while, Airbnb must serve and strengthen local communities, while expanding diversity and acceptance in the world. Serving stakeholders means being honest about where we need to improve because we know we are far from perfect. One area we are focused on is making sure that, in markets that are significantly housing constrained, the Airbnb community is helping people stay in their homes and share their communities and not negatively impacting housing.
- To begin measuring how well we are serving all stakeholders, in March, we’ll release Airbnb’s first Annual Stakeholder Report. This report will explicitly identify the criteria by which we want to hold ourselves accountable to our stakeholders. In the same way that a company’s annual report facilitates the evaluation of its financial performance for shareholders, what we measure and talk about must indicate progress towards our effort to become a 21st-century company.
Part of designing a 21st-century company is designing a Board of Directors that can help us implement our 21st-century vision and institutionalize our intentions. I am proud to announce that we will be adding Ken Chenault to our Board of Directors as our first non-affiliated independent director. Airbnb is built on trust. As the CEO of American Express, Ken has built one of the most successful trust-based companies in the world. It is a company that has endured and innovated for nearly 168 years. Ken and I spent time talking about the 21st-century model and in particular the role of trust as the infrastructure for such a model. Ken also believes deeply that, now more than ever, companies need to stand for values, character, and competence. As he says, “I think corporations exist because society allows us to exist. Corporations are not entitled to exist. So I think we have a responsibility and an obligation to help improve society.”
Ten years after we started Airbnb, I have often thought, how could an idea like millions of strangers sleeping in each other’s homes ever work? The truth is that we, Airbnb the company, did not do most of this. Our hosts, and the broader Airbnb community, created most of this. And they have taught me two things: people are fundamentally good, and we are 99% the same.
If people are good and mostly the same, then we should be able to offer more than people sleeping in one another’s homes. We imagine a world where every one of us can belong anywhere. A world where you can go to any community and someone says, “Welcome home.” Where home isn’t just a house, but anywhere you belong. Where every city is a village, every block a community, and every kitchen table a conversation. In this world, we can be anything we want. This is the magical world of Airbnb. We will probably never fully realize this vision, but we will die trying.
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