Here’s “The Best Advice I’ve Ever Received”

A single piece of advice from an investor helped Airbnb CEO Brian Chesky grow his company from a struggling startup to an industry behemoth worth about $70 billion.

That’s according to Chesky himself, who told attendees at a recent Stanford Graduate School of Business event that it was “the best advice I’ve ever received.”

The advice: “Focus on 100 people you love instead of trying to make a million people kinda like you,” Chesky said.

It came courtesy of Paul Graham, co-founder of tech startup accelerator Y Combinator, who advised Airbnb co-founders – Chesky, Joe Gebbia and Nathan Blecharczyk – to focus on building their business with a small audience of potential customers.

Such a recommendation “actually contradicts almost everything everyone says,” Chesky said.

For early Airbnb, that meant creating guest experiences that were different from staying in a hotel or sleeping on the couch. The trio took their research seriously, even hiring a Pixar storyboard artist to help them plan what five-star stays would be like from check-in to check-out, Chesky said.

It also meant figuring out what would make hosts happy and comfortable at the same time. Shortly after founding the company, the co-founder trio visited a group of Airbnb rentals in New York to personally photograph the listings and better understand the perspectives of the hosts, Chesky said on the LinkedIn co-founders’ Masters of Scale podcast Reid Hoffman in 2017.

The small group of people who loved the Airbnb experience, guests and hosts alike, became the company’s “marketing arm,” Chesky said at the Stanford event.

In his estimation, the strategy worked. In its first decade, Airbnb grew larger than Hilton, which was founded in 1919 and currently has a market cap of $36.43 billion. Much of that early growth came from word of mouth, Chesky said.

Unfortunately, Graham also gave the Airbnb co-founders the “worst advice” they’ve ever received, Chesky added — that they need to move to Mountain View, California, where Y Combinator is based, in order to be successful.

“You don’t have to move [to Silicon Valley]’ said Chesky. “You can be anywhere.”

Airbnb is still based in San Francisco today, but Silicon Valley has seen a brain drain of tech companies in recent years, with notable companies like Oracle and Hewlett-Packard Enterprise relocating their headquarters out of California in 2020.

According to Inc. magazine, San Francisco was only the fifth best city in the US to start a business this year, largely due to the high cost of living. Austin, Texas topped the rankings, followed by Salt Lake City and Raleigh, North Carolina.

Chesky has also championed the idea of ​​working from home more broadly, at least since the start of the Covid-19 pandemic — or, as one might expect from Airbnb’s CEO, working from home.

“I guarantee you that a lot of these CEOs who are calling people back to the New York City office are going to the Hamptons for the summer or are traveling to Europe in August,” Chesky said on The Verge’s Decoder podcast earlier this month .

DON’T MISS: Do you want to be smarter and more successful with your money, your work and your life? Sign up for our new newsletter!

Get CNBC’s free report, 11 ways to tell if we’re in a recession, Here, Kelly Evans reviews the top indicators that a recession is imminent or has already begun.