Airbnb was once a scrappy startup fighting for legitimacy in a hospitality industry dominated by hotels and established travel brands. 

The idea of strangers sharing their homes with other strangers was a bold one — but it quickly ran into the problem of trust. In the summer of 2011, guests who had booked through the platform vandalized a host’s apartment. The story went viral, and within days, it appeared that Airbnb’s entire reputation could collapse. A hashtag even began trending on Twitter, now X: #RIPAirbnb.

Brian Chesky, who co-founded Airbnb in 2007 and was its CEO from the start, calls this the crisis that would define him. In a recent interview with CNBC’s Leader’s Playbook, Chesky says that the incident “was our moment of truth.”

“I wrote an open letter to the community, I apologized to the woman who this happened to,” he said. “We took a lot of responsibility.”

At the time, Airbnb had no insurance or formal protection policy for damages. So homeowners who listed their properties were taking an enormous leap of faith with little to no safety net. Chesky realized that the company’s promise extended far beyond convenience or novelty — it hinged on trust. Without it, people would never open their doors. 

Following the incident, Chesky introduced a $50,000 Host Guarantee to cover any damage caused by guests. It was a bold financial risk for a young startup, but it symbolized transforming a liability into a strength. Over time, that guarantee expanded into what is now a $3 million Host Guarantee, a generous protection policy in the home-sharing industry.

“We took our Achilles heel and made it a strength,” Chesky told CNBC Leader’s Playbook. “And that moment I realized, that’s what a leader is. A leader steps up in times of crisis. They’re decisive. You’re not just seeking consensus. You have to have the courage to make a defining decision that’s going to chart your way forward. And that was really the moment I became a CEO.”  

By taking decisive action and centering his decisions around the needs of his community, Chesky embodied a principle that would guide Airbnb’s future — trust must always come before profit. This philosophy later shaped many of Airbnb’s most important choices. For example, the startup enforced verification standards for hosts and booking guests starting in 2023, asking for photos of government IDs. 

“As a platform that works to build trust, the identity verification process is a foundational aspect of what we do,” Nabarupa Banerjee, Airbnb’s Director of Trust, wrote in a press release. 

Chesky is also known for popularizing a “founder mode” style of management, in which founders interact with employees across the organization, not just their direct reports. He said last year that he is a hands-on manager with 40 to 50 employees. 

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