I'm surprised actually a little bit how much the tech community's embraced fitness. I mean, like when I came to Silicon Valley, I was like slightly self-conscious about like wearing long sleeve shirts because I thought if I wear those shorts, people think I'm a meathead and therefore an idiot. And people just didn't really lift weights in like 2007, 2008.
And I really think that like everyone's come around probably to just the science that like nutrition and weightlifting is good. It's good for longevity. It's good for your mind. You'll live longer. You'll feel better.
The co-founder and CEO of Airbnb in the Rerum waiting room. We're bringing in the TV ped, great to see you again. How are you doing?
Hey guys, good to see you. Thank you for having me back on.
Of course, you're welcome anytime. It's great to be here with you. First, kick us off with the news. You've been acquiring talent, building the roster. You have a new CTO. How did it come about? Tell me about this person.
Yeah, so like you know, obviously a couple years ago, I started asking around like who are some of the best leaders in AI? And I started meeting people and one of the names that came up over and over was this guy named Ahmad Al-Dahle and he was a head of generative AI at Meta. We met and I just was completely blown away by him. You know, not only was he at Meta and he essentially created, led the team that created the Llama models, been downloaded a billion times. There's been over 60,000 derivative models. But he was also at Apple. He actually joined Apple out of college. Worked on the original iPhone in 2005. Led a lot of the multi-touch technology. He led the autonomous technology group that was the self-driving car project at Apple. So, he was somebody at the frontier. He really understood both frontier technology, but he also understood that like kind of Apple design craft, which I think Airbnb also is really passionate about. And we just really hit it off, became friends, and as my current CTO, we were talking about handing the baton to somebody. We thought it would be really great.
Yeah. How are you thinking about design in the era of generative AI? These apps are amazing and the fun and the models like you see the benchmarks, you use the models and it's magical. It's like you know we created fire. And then one rough edge, one button that doesn't quite work the way you expected it. I was lamenting the fact that I was using Claude and I couldn't get a deep research report to read it out loud to me. That feature is in one app and there's different features there. How do you...
Yeah, it feels very notable that even in all the leading LLMs, there's still so many rough edges in the product.
Part of that is like a new product paradigm. We're kind of figuring out what the edges are. But...
Yeah, maybe there's all sorts of metaphors. You know, I remember when I was a kid, I had, I think I got like a Compaq computer and I was running MS-DOS and we're kind of more in the MS-DOS phase of AI. You know, I don't, I think, not to belittle the interfaces, but the chatbot is not the end state interface. The current chatbot is not the end state interface for AI. I mean, think about your phone and your app. Do you want to chat to get the weather? Do you want to chat to like do most of the functions? The answer is no. And so, I think the future AI interface will have a reference to chat, but it's probably going to be much more visual. Most people aren't completely text-based. And I do think there's been a, it's kind of like we've been iterating the engine of the car, but we haven't really redesigned the car. And so the chatbot is really a pre-AI interface that we've plugged onto this incredibly powerful engine.
And so I think what we're trying to do is think through like where can we take this interface? What is the like multi-touch reference for an age of AI? And we're not going to do this overnight. But I really think the models are even more powerful than people realize. In a year or two, we really want to like skate to where the puck is going and do something really, really cool. So I totally agree with you. And I think the other thing I'd say is like I'm on the board of Y Combinator and I think the last I checked 87% of the companies are enterprise companies per batch.
People aren't... Oh, we go and we meet with every batch and to have them on the show and we're always trying...
Hey, we want every consumer company to come on because often times...
Yeah. Often times they give you...
And the interesting thing is all of them, all these founders started doing consumer businesses. You ask them, they're doing Minecraft servers and flipping sneakers and stuff. So, they actually have some consumer DNA, but they end up really...
So, you're bringing up a really good point. I joined YC in 2009 and that was not like two years after the iPhone was introduced and almost every startup was a consumer company and enterprise is awesome and I think it makes complete sense why AI is starting with enterprise because the models are not cheap to run. You can basically vertically integrate any business and completely automate the workflow. It's going to revolutionize how we do work. But the point is that the biggest prize is consumer because that is what's going to reach daily life for billions of people. And I think a lot of people are a little bit, a lot of entrepreneurs are afraid to go into consumer. That's the biggest thing we've heard. They're afraid, partly they're worried that like OpenAI or Google are going to like essentially eat their lunch and vertically integrate. The other concern is consumers just hard. You know, it's a little bit more of a hit-driven business. Distribution's a little more mature because of the app store. There's not really new distribution channels in the same way. At the same time, we are in the midst of a revolution. And more than just a couple chatbots have to be the way that you interface with the world. And I also, this might be self-serving to say, but I also believe this independently. I don't think we're going to use just one agent. I don't think we don't have just one person in our life. I don't think we're going to have just one agent in our life. I don't think we'll use thousands, but I think there's going to be some level of specialization that's going to help. And we like, there's going to be too much specialization where I wouldn't download that agent or use that agent. But I think even if you want a meta orchestrator whether it's Claude or Gemini or ChatGPT, specialization is going to help even within consumer. So we want to do some really cool stuff within traveling and living.
Yeah. What advice do you give to the 13% of Y Combinator founders that are going after consumer at least for now or at least in this moment? Is it hey keep your burn really low, run a ton of experiments, stick it out because it feels like part of the reason why 87% wind up in enterprise is because businesses are just throwing money at them, they're saying yeah you're doing consumer but if you come solve this one really small problem for me and build this API for me I'll give you a contract. I'll be your first customer. It's very easy to get the money flowing on the business side potentially. But how can you actually make it as a consumer founder when there is a big prize but it might be a harder road?
Yeah. So many thoughts here. I mean one of the things that Paul Graham taught us and Gary Tan teaches which I think is very effective is use other companies as your early adopters. Hence why a lot of companies go into enterprise. If you have an AI company don't go to like Boeing to try to use your service. Go to a young startup and work your way up to the large companies. And so they've developed this incredible ecosystem where thousands of companies are adopting each other's tools and they bootstrap each other. And that's actually been part of the explanation for why Y Combinator has so successfully created so many enterprise companies. But when I was in Y Combinator, we got everyone to use Airbnb. And so in other words, like we have a huge alumni network. I would tell people that are going into consumer, number one, don't be afraid to do AI consumer. It might fail, but like investors aren't going to hold it against you that a startup failed. They're gonna like a founder who's failed is more fundable the next time than someone who's never started unless they really blew it because you have experience. And I think that's what's so great about this. Number two, you got a lot of early adopters within YC who are normal people, too. They have daily life. I would agree to keep your burn rate low. I would pick a niche. I wouldn't pick a niche that's too narrow. So like maybe like AI to do something incredibly narrow is going to get really, really difficult for somebody to want to like change their workflow and behavior. But just think about all the parts of daily life that are kind of annoying. And maybe pay attention to like your sister, your significant other, your children, like whoever's in your life and just look at their life and ask like how could their daily life be a little bit easier? And I would just go for it. I mean and by the way like the app store is mature. That's a little bit of an issue. At the same time, the top apps in the app store are AI apps. So, if something is truly great and truly breakthrough, people will seek it out. And I do think my prediction is that AI is going to revolutionize consumer applications in the coming years. And they might not be apps, they might become agents. Agents might be the new apps. We have to figure out what that means. What's new platform paradigm is probably agents, not apps. But we'll see.
But ultimately, I think that's the big takeaway here. And so what we're going to do is we want to really innovate on the consumer experience. We want to integrate, we want to interface on like what does consumer interfaces look like in the age of AI. And I think they should evolve past the current design paradigm and we'll see where it goes.
Yeah, it would be, I'm not expecting to open the Airbnb app and see a blank text box purely, like there's so much more that you can do. Have you thought more about the Airbnb app is unique I think because it's not this reactive, people are opening it 10 times a day. There is an intention and there's probably a lot of value in understanding okay this person they like to travel around the holidays. They're opening the app in October. Let's think that through. Agents and LLMs can probably work through a customer's history, their preferences, just do better recommendations. What you're servicing them. How much have you thought about being proactive about reaching the customer with something that's more tailored? What's been working? Where do you see it going?
Yeah, I mean so many things. One of the other problems with consumer to keep coming back to it is there's a business model challenge, right? Like these models are not cheap. And so there's probably one of three ways you can make money in consumer. You can put ads in your chatbot. You can pay a subscription or you can do essentially transactions. Well, Airbnb luckily has the business model. We have transactions and our transactions are pretty high dollar transactions. So, we actually have the really the business model going for us. We also have a lot of data. We do about 50 billion searches a year on Airbnb. That's nothing compared to Google, but 50 billion. So, that's that number of times somebody's typing in something to an Airbnb search box. So we actually do have quite a bit of data about people, their preferences, and we can bring it in. And so in part of what we want to do is if the interface is a little more chat-like, again, won't be per se a chatbot exactly like OpenAI, but if is a little more of a turn-by-turn chat-like connection, you're going to get a lot more information from people. And I think, you know, the one benefit of the current chatbots are they have memory. And so you're putting a lot of context in the window. And I think memory, by the way, is something I think we're going to want to technically innovate on because the chatbots still are stateless. And so you're essentially the prompt is putting in this kind of, you know, obviously a lot of your memory. So I do think there's going to be an area around how can everybody understand people's preferences, learn more about you, understand what you care about, and just be really thoughtful like what's your bucket list? Who are you traveling with? One of the other things can be really good at is the majority of trips have multiple people. Most chatbots are single player mode. They have collaborative tools, but most people are not chatting with multiple people. Most people in Airbnb are searching for an Airbnb with multiple other people. So, I think another thing we really want to do is really be great at like understanding two people. They have totally different preferences. How do we help them figure out the right choices for them? So, a lot of collaboration tools I think going to be really important. But I think at our heart what we want to do is really build out these robust profiles, deeply understand people and give them what they want in the real world.
How are you thinking about the challenges of generative AI imagery in Airbnb listings? I can imagine there's sort of a risk of what is it called? Catfishing where someone takes a photo, it is their house, but they said, hey, like patch up the walls and you know, let's change the lighting and make it look a little bit warmer, a little bit nicer. And there's probably a little bit of that that's fine. You know, if you took it on a phone, you want it to look nice, but you want it to represent the actual experience. How are you thinking about the challenges with that?
Yeah. I mean, like it's really interesting, right? Like I don't know, I saw on Twitter yesterday like the Stranger Things where like you can turn your face into someone else's face. And so what this really means is the like know your customer authentication. A lot of it is like, you know, you do a selfie and an ID or you do a video. A lot of this stuff now AI can get around. And so I mean we should remember AI stands for artificial. And so we're now starting to live in a world where if you see in a screen it might be artificial. And so I think authentication is going to be critical. And one of the best authentications is in the real world. I mean we're going to be pretty soon living in a world where you don't know if something's real unless you've seen it in the real world. Unless we have authentication. One example of the way we can solve this for example is we do have a network of professional photographers over 5,000 around the world. In fact, we built an on-demand professional photography network before Uber even launched where you hit a button and a photographer shows up and takes photos of your home. An advantage of that is those photos are by Airbnb and so we took them, a customer would know those are authenticated photos from us. That's just an example of something that is possible. But I do think like solving this is this real? Is this authenticated is really important. So we're going to have to have something, we're going to have to have technology solutions for it.
Yeah. What's your latest thinking on integrating Airbnb with various LLMs? Like how are these conversations going into...
Yeah. I'm interested. I think last time I was on I said they weren't ready.
Yeah. Yeah. Um and my view, you know, we chose not to launch with ChatGPT. They launched with Expedia booking and the reason why I wasn't like, I was a huge fan of that project and gave Sam some advice on it and stuff and I think it's awesome. I would love to show up on ChatGPT. I would love to show up on Gemini. I'd love to show up on Claude. I don't, here's the thing. I don't want to be the first. I want to be the best. Like we want to have the best integration, not the first integration. There's some limitations. 90% of people book an Airbnb send a message to a host ahead of time. You have to have a verified ID. There's just some things we need in integration for Airbnb to have a really good integration. We'd love that. By the way, the traffic coming from ChatGPT converts higher on Airbnb to a booking than the traffic coming from Google search. Yeah.
So, actually various like e-commerce brands have been reporting this too like the traffic is super high intent because people are informed.
Yeah. So, I get this question asked to me often as an existential thing as in are you going to partner with them or not and are they going to kill you and is there going to be no app in the future? And my answer is there probably are no apps at some point in the future. They're probably agents. That's there's probably some platform like paradigm. We're probably designing agents. I don't know for sure. But I think that we're going to exist on those platforms. But I also think specialization is going to matter. I don't think there's just going to be a few chatbots and they do everything and you are separated from every application. That's going to be true of some apps and that's going to be true if you need like maybe a commodity, but there are going to still be reasons to work with different agents or different applications. I think some specialization will make a difference.
