I want to tell you the story about the timeI almost got kidnapped in the trunk of a red Mazda Miata. It's the day aftergraduating from design school and I'm having a yard sale. And this guy pulls upin this red Mazda and he starts looking through my stuff. And he buys a pieceof art that I made. And it turns out he's alone in town for the night, drivingcross-country on a road trip before he goes into the Peace Corps. So I invitehim out for a beer and he tells me all about his passion for making adifference in the world.
Now it's starting to get late, and I'mgetting pretty tired. As I motion for the tab, I make the mistake of askinghim, "So where are you staying tonight?" And he makes it worse bysaying, "Actually, I don't have a place." And I'm thinking, "Oh,man!" What do you do? We've all been there, right? Do I offer to host thisguy? But, I just met him -- I mean, he says he's going to the Peace Corps, butI don't really know if he's going to the Peace Corps and I don't want to end upkidnapped in the trunk of a Miata. That's a small trunk!
So then I hear myself saying, "Hey, Ihave an airbed you can stay on in my living room." And the voice in myhead goes, "Wait, what?"
That night, I'm laying in bed, I'm staringat the ceiling and thinking, "Oh my god, what have I done? There's acomplete stranger sleeping in my living room. What if he's psychotic?" Myanxiety grows so much, I leap out of bed, I sneak on my tiptoes to the door,and I lock the bedroom door.
It turns out he was not psychotic. We'vekept in touch ever since. And the piece of art he bought at the yard sale ishanging in his classroom; he's a teacher now.
This was my first hosting experience, andit completely changed my perspective. Maybe the people that my childhood taughtme to label as strangers were actually friends waiting to be discovered. Theidea of hosting people on airbeds gradually became natural to me and when Imoved to San Francisco, I brought the airbed with me.
So now it's two years later. I'munemployed, I'm almost broke, my roommate moves out, and then the rent goes up.And then I learn there's a design conference coming to town, and all the hotelsare sold out. And I've always believed that turning fear into fun is the giftof creativity.
So here's what I pitch my best friend andmy new roommate Brian Chesky: "Brian, thought of a way to make a few bucks-- turning our place into 'designers bed and breakfast,' offering youngdesigners who come to town a place to crash, complete with wireless Internet, asmall desk space, sleeping mat, and breakfast each morning. Ha!"
We built a basic website and Airbed andBreakfast was born. Three lucky guests got to stay on a 20-dollar airbed on thehardwood floor. But they loved it, and so did we. I swear, the ham and Swisscheese omelets we made tasted totally different because we made them for ourguests. We took them on adventures around the city, and when we said goodbye tothe last guest, the door latch clicked, Brian and I just stared at each other.Did we just discover it was possible to make friends while also making rent?
The wheels had started to turn. My oldroommate, Nate Blecharczyk, joined as engineering co-founder. And we buckleddown to see if we could turn this into a business.
Here's what we pitched investors: "Wewant to build a website where people publicly post pictures of their mostintimate spaces, their bedrooms, the bathrooms -- the kinds of rooms youusually keep closed when people come over. And then, over the Internet, they'regoing to invite complete strangers to come sleep in their homes. It's going tobe huge!"
We sat back, and we waited for the rocketship to blast off. It did not. No one in their right minds would invest in aservice that allows strangers to sleep in people's homes. Why? Because we'veall been taught as kids, strangers equal danger.
Now, when you're faced with a problem, you fall back on what you know, and all we really knew was design. In art school,you learn that design is much more than the look and feel of something -- it'sthe whole experience. We learned to do that for objects, but here, we wereaiming to build Olympic trust between people who had never met. Could designmake that happen? Is it possible to design for trust?
I want to give you a sense of the flavor oftrust that we were aiming to achieve. I've got a 30-second experiment that willpush you past your comfort zone. If you're up for it, give me a thumbs-up. OK,I need you to take out your phones. Now that you have your phone out, I'd likeyou to unlock your phone. Now hand your unlocked phone to the person on yourleft.
That tiny sense of panic you're feelingright now --is exactly how hosts feel the first timethey open their home. Because the only thing more personal than your phone isyour home. People don't just see your messages, they see your bedroom, yourkitchen, your toilet.
Now, how does it feel holding someone'sunlocked phone? Most of us feel really responsible. That's how most guests feelwhen they stay in a home. And it's because of this that our company can evenexist. By the way, who's holding Al Gore's phone?
Would you tell Twitter he's running forPresident?
OK, you can hand your phones back now.
So now that you've experienced the kind oftrust challenge we were facing, I'd love to share a few discoveries we've madealong the way. What if we changed one small thing about the design of thatexperiment? What if your neighbor had introduced themselves first, with theirname, where they're from, the name of their kids or their dog? Imagine thatthey had 150 reviews of people saying, "They're great at holding unlockedphones!"
Now how would you feel about handing yourphone over?
It turns out, a well-designed reputationsystem is key for building trust. And we didn't actually get it right the firsttime. It's hard for people to leave bad reviews. Eventually, we learned to waituntil both guests and hosts left the review before we reveal them.
Now, here's a discovery we made just lastweek. We did a joint study with Stanford, where we looked at people'swillingness to trust someone based on how similar they are in age, location andgeography. The research showed, not surprisingly, we prefer people who are likeus. The more different somebody is, the less we trust them. Now, that's anatural social bias. But what's interesting is what happens when you addreputation into the mix, in this case, with reviews.
Now, if you've got less than three reviews,nothing changes. But if you've got more than 10, everything changes. Highreputation beats high similarity. The right design can actually help usovercome one of our most deeply rooted biases.
Now we also learned that building the rightamount of trust takes the right amount of disclosure. This is what happens whena guest first messages a host. If you share too little, like, "Yo,"acceptance rates go down. And if you share too much, like, "I'm havingissues with my mother,"acceptance rates also go down. But there'sa zone that's just right, like, "Love the artwork in your place. Comingfor vacation with my family." So how do we design for just the rightamount of disclosure? We use the size of the box to suggest the right length,and we guide them with prompts to encourage sharing.
We bet our whole company on the hope that,with the right design, people would be willing to overcome the stranger-dangerbias. What we didn't realize is just how many people were ready and waiting toput the bias aside.
This is a graph that shows our rate ofadoption. There's three things happening here. The first, an unbelievableamount of luck. The second is the efforts of our team. And third is theexistence of a previously unsatisfied need. Now, things have been going prettywell.
Obviously, there are times when thingsdon't work out. Guests have thrown unauthorized parties and trashed homes.Hosts have left guests stranded in the rain. In the early days, I was customerservice, and those calls came right to my cell phone. I was at the front linesof trust breaking. And there's nothing worse than those calls, it hurts to eventhink about them. And the disappointment in the sound of someone's voice wasand, I would say, still is our single greatest motivator to keep improving.
Thankfully, out of the 123 million nightswe've ever hosted, less than a fraction of a percent have been problematic.Turns out, people are justified in their trust. And when trust works out right,it can be absolutely magical.
We had a guest stay with a host in Uruguay,and he suffered a heart attack. The host rushed him to the hospital. Theydonated their own blood for his operation. Let me read you his review.
"Excellent house for sedentarytravelers prone to myocardial infarctions.
The area is beautiful and has direct accessto the best hospitals.
Javier and Alejandra instantly becomeguardian angels who will save your life without even knowing you. They willrush you to the hospital in their own car while you're dying and stay in thewaiting room while the doctors give you a bypass. They don't want you to feellonely, they bring you books to read. And they let you stay at their houseextra nights without charging you. Highly recommended!"
Of course, not every stay is like that. Butthis connection beyond the transaction is exactly what the sharing economy isaiming for.
Now, when I heard that term, I have toadmit, it tripped me up. How do sharing and transactions go together? So let'sbe clear; it is about commerce. But if you just called it the rental economy,it would be incomplete. The sharing economy is commerce with the promise ofhuman connection. People share a part of themselves, and that changeseverything.
You know how most travel today is, like, Ithink of it like fast food -- it's efficient and consistent, at the cost oflocal and authentic. What if travel were like a magnificent buffet of localexperiences? What if anywhere you visited, there was a central marketplace oflocals offering to get you thoroughly drunk on a pub crawl in neighborhoods youdidn't even know existed. Or learning to cook from the chef of a five-starrestaurant?
Today, homes are designed around the ideaof privacy and separation. What if homes were designed to be shared from theground up? What would that look like? What if cities embraced a culture ofsharing? I see a future of shared cities that bring us community and connectioninstead of isolation and separation.
In South Korea, in the city of Seoul,they've actually even started this. They've repurposed hundreds of governmentparking spots to be shared by residents. They're connecting students who need aplace to live with empty-nesters who have extra rooms. And they've started anincubator to help fund the next generation of sharing economy start-ups.
Tonight, just on our service, 785,000people in 191 countries will either stay in a stranger's home or welcome oneinto theirs. Clearly, it's not as crazy as we were taught.
We didn't invent anything new. Hospitalityhas been around forever. There's been many other websites like ours. So, whydid ours eventually take off? Luck and timing aside, I've learned that you cantake the components of trust, and you can design for that. Design can overcomeour most deeply rooted stranger-danger bias. And that's amazing to me. It blowsmy mind. I think about this every time I see a red Miata go by.
Now, we know design won't solve all theworld's problems. But if it can help out with this one, if it can make a dentin this, it makes me wonder, what else can we design for next?