Chip Conley tries to make sure that guests using the online room rental service have a smooth stay as the company tries to become full-fledged hospitality business.
If Chip Conley misses anything about staying at hotels, it’s room service. Waiters delivering pasta dinners to guest rooms is a dying convenience because hotels lose money doing so.
“Guests who use room service love it, but its future is not looking good,” Conley says.
In April, Conley, a hotel industry veteran, traded “institutionalized” amenities like room service for apartment rental website Airbnb. His job is to make sure Airbnb users are happy whether they rent someone’s college crash pad, a cozy condo or a seaside mansion in Hawaii.
Conley’s hiring is intended to enhance Airbnb’s appeal at a time when it is trying to become a full-fledged hospitality business. To get to the next level, the company has to ensure a certain level of comfort — or at least set realistic expectations — for guests and hosts.
Conley and his hospitality team in San Francisco and Ireland must keep close tabs on Airbnb’s 800,000 hosts, who range from people who rent out extra rooms in their homes to mini real estate moguls who list a number of apartments. Hosts are supposed to stick to nine standards including accuracy of their online listings and keeping homes tidy.
Earlier this year, Conley embarked on a 17-city world tour training hosts on what he calls, the “five moments of truth” for Airbnb travelers. It hammers home the importance of impressing guests as soon as they step in the door and being responsive to their questions and needs.
Still, problems may pop up. When guests complain that a place they’ve rented doesn’t accurately match up with what they see online, Airbnb’s around-the-clock customer service troubleshoots the problem (at least in theory).
In a worst case scenario, people can be moved to a new place or get a refund. Earlier this year, when a New York customer returned home to find an orgy underway in the apartment she rented out, Airbnb took immediate action to ensure the apartment owner had a safe place to stay, reimbursed her for property damage and kicked the Airbnb guest off the service for good.
“The truth is on a peak night this summer we had 450,000 people staying on the site on any one night — it’s like the city of New Orleans,” Conley says. “Will there occasionally be activities that are abhorrent on the site? Yeah, but I’m really proud of our trust and safety team.”
Scenarios like drug-fueled destruction, prostitution, and theft also happen, but they’re infrequent, he argues. For one, Airbnb’s host guarantee, a $1 million policy covering damaged property, is used only one out of every 62,000 times someone stays at an Airbnb listing, the company says.
This week, Airbnb is having 1,400 of its top hosts fly to San Francisco for a three-day conference Conley and Chesky created to recognize and educate hosts. At the event, Conley plans to unveil tools that will help hosts better understand the supply and demand for rooms in their cities.
By the end of the year, Airbnb will roll out a partnership with the widely-used corporate expenses service Concur, so business travelers can more easily expense Airbnb stays. The partnership is one piece in Conley’s larger business travel strategy. Roughly 10% of all Airbnb guests are business travelers, but Conley wants that share to double in the next 12 months.
Conley, 54, has decades of experience to draw from. In 1987, he started Joie de Vivre, a group of boutique hotels that expanded to more than 30 properties before he sold most of the business in 2011. (He still owns 18 hotels.) He also collected several hospitality awards along the way.
Among associates and friends, Conley is known as a sharp entrepreneur who brings his big-hearted philosophy to the office.
“Chip reminds me daily that businesses can be run with soul,” says Joe Gebbia, an Airbnb co-founder and chief product officer.
Zappos CEO Tony Hsieh, who wrote the foreword to Conley’s first book, “Peak,” about lessons culled from his experience at Joie de Vivre, said: “In the business world, there’s this common wisdom that to run a company, you have to choose to run it like a non-profit or a soulless business. Chip has proven you don’t have to choose either approach.”
For three years after selling most of Joie de Vivre, Conley channeled his energies into other ventures: the bestselling self-help book “Emotional Equations” and Fest300, an online guide to the world’s best festivals. He also got more involved with Burning Man, the annual seven-day festival in Nevada’s Black Rock Desert, and co-founded its board.
Then in spring of last year, Airbnb CEO Brian Chesky came knocking. Chesky, who co-founded Airbnb with Gebbia and chief technology officer Nate Blecharchzyk in 2008, had already found success in legitimizing couch surfing as an alternative to staying at a hotel.
The company, valued at $10 billion in its latest round of funding, currently lists over 800,000 places to rent online in 34,000-plus cities. This week, Airbnb introduced Pineapple, a quarterly travel magazine that is distributed to 18,000 Airbnb hosts for free.
Chesky wanted Conley’s advice on how to be an effective, long-lasting CEO. (“And here I am, this old guy who had been a CEO for a long time,” Conley quips.) He also had ambitions of taking Airbnb from a tech company that connected hosts and travelers to a full-fledged hospitality business — something Conley knew a lot about.
When Chesky eventually asked him to consider a bigger company role over an arm-wrestling match, Conley agreed. He liked the idea of helping hosts, or what he calls, “micro-entrepreneurs,” make a living by opening their homes to strangers.
“It’s one thing to jump in a cab or shared car service and go for a 10 minute drive,” he says. “It’s a whole different thing to stay in someone’s home for a few days.”
With his job, Conley aspires for the loftiest of goals. At the startup’s annual executive retreat in Sonoma earlier this year, Chesky asked him where he wants to see Airbnb in 10 years. Conley’s response? I’d love to see us win the Nobel Peace Prize. (Yes, seriously.)
His rationale is that Airbnb is helping with cross-cultural understanding. By staying in someone’s home rather than the local Holiday Inn, guests are being thrust into a different world.
“A lot of times, we tend to villainize the other,” Conley says. “But when people are traveling, getting to know others and turning strangers into friends, we create a world where there are a lot fewer people who seem alien to us.”