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Q&A Tech

Getting to know Airbnb and Uber: Q&A with Brad Stone

The Upstarts is an illuminating new book documenting the culture, practices and impact of Airbnb and Uber. Author and Bloomberg journalist Brad Stone speaks to Courier.

10 Feb 2017

You wrote about about Amazon in your last book. To what extent did that experience influence Upstarts?

Oh, significantly. I’ve been circling tech for about 20 years, and been building this mosaic of Silicon Valley.

Airbnb and Uber are without doubt the twin successes of the latest wave, raising a ton of money, and hitting these [regulatory] roadblocks.

How do these founders contrast with the first wave of tech founders?

These CEOs are completely different, and they have to be. I’ve met a lot of them as part of my job at Bloomberg. Mark Zuckerberg (Facebook), Bill Gates (Microsoft), Larry Page (Google); they’re all quite geeky and introverted. Brian Chesky (Airbnb) and Travis Kalanick (Uber) are charismatic: great speakers and storytellers. They’re going city-by-city fighting entrenched industries.

They both appear to have taken the position of ‘apologise after rather than ask first’. How important has that been?

Absolutely. Don’t forget Airbnb is illegal in New York. But both took that approach when they were small and able to fly under the radar. Then they simply got too big to keep that strategy, and it resulted in conflict with various interests. But they wouldn’t have launched if they asked for permission.

Is there something inherently different about these companies?

In many ways, they’re not at all different. The folks at Airbnb and Uber are complete disciples of Jeff Bezos. They worship Amazon. Uber, for example, has 14 cultural values that are very similar to Amazon’s 14. Even the idea of losing money to build scale was pioneered and legitimised by Bezos.

They’re different in that Airbnb and Uber are hyper local. They simply need a lot more people on the ground.

Like Google, Twitter and Facebook, Uber and Airbnb appear keen to promote the idea they are ‘benign’ platforms.

There’s a grand history in Silicon Valley of companies like Craigslist and Google not taking responsibility for buyers and sellers or people posting content. The difference here is there are instances of people dying as a consequence of the services offered by Airbnb and Uber, so it’s not just ‘disappointing people with a bad experience’. They realised the benign platform position wasn’t going to fly and they had to take more responsibility.

The caricature we often have of these two guys is Kalanick as belligerent, and Chesky as a lot softer. Are these fair?

It’s true to some extent. Chesky is friendlier and he certainly has the personality of someone in the hospitality industry. He believes in the value of shaking everyone by the hand and smiling as an approach to break down barriers, even with enemies. Kalanick is certainly hard-driving, confrontational.

Were there any key incidents that altered the trajectory for both of them?

For Airbnb, I think it was when the Samwer brothers in Germany [the Rocket Internet founders] began cloning Airbnb, and Airbnb quickly realised it had to get professional very quickly and start building a network. That was huge.

As for Uber, it was also reactive. Lyft had the idea that anyone with car and a driving licence could offer ride sharing. Uber then came out with UberX which was very different to what Lyft had been doing. That’s now the majority of its business, but it hadn’t pioneered it. To make it happen, that was pure Kalanick.

Do you think both have the personalities to lead their companies for a long time?

Quite possibly. But they have their limitations and need to adapt in their own way.

With Kalanick, we saw an example of his personality recently with the controversy around him being on Trump’s business council. He’s totally rational, logical, principled and argumentative. He’s got a perfect case in thinking it’s better to have a seat on that council to influence rather than be outside. But he missed the emotional aspect; the extent his mere presence there would obviously upset drivers and customers.

As for Chesky, his instinct is to be nicer and talk to cities. But what’s coming up for Airbnb is a more organised and serious challenge from hotels and cities. He will have to be willing to be (and be seen to be) more pugnacious against these forces.

Could Uber or Airbnb be disrupted?

Airbnb is probably pretty well protected. It’s got that benefit of network effect on a global scale. Uber is different. There’s no guarantee they will lead in driverless cars. They want to pioneer it but they could take a big hit if Google, General Motors, Didi [Chuxing, China’s answer to Uber] or anyone else gets there first.

Overall, do you think these companies provide an economic and social net positive?

They’ve created opportunities and given people options. A lot of US cities are very poorly served by public transport. If you’re African American, you often just can’t get a cab. And a lot of people have been able to get a revenue stream from driving or letting out their home they wouldn’t otherwise be able to. Families can afford to take holidays which they wouldn’t have before.

But there is a risk of real damage to our cities from both of them. You probably don’t want your neighbour to become a youth hostel. The treatment of drivers is a concern and we still don’t know the impact of Uber on cities and traffic.

It’s complicated, but overall, I think I’m optimistic about their long-term impact. We have to see if they deliver their promises on reducing traffic and bringing better experiences to cities.

 

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