In case you missed this last summer, my heart goes out to “EJ” and Troy whose homes were trashed by AirBnB “guests.” If you’re not familiar with those events, have a look at those links to catch up. Some of the thoughts expressed here were part of comment threads I participated in on TechCrunch. I’ve edited this post slightly for grammar and republished with a new title that I think matches the content better as well as refining the final 2 questions; the content remains materially the same, including my somewhat controversial “boy” comments. Any apparent flip flops in position are accidental.
I’m interested in the curious response by the CEO of AirBnB. Why is Brian Chesky handling this so ineptly? TechCrunch is asking some great questions finally (albeit a few months too late after hyping the shit out of the company because let’s face it Paul Graham’s a pretty important guy in Mike Arrington’s world). This will have a major impact on revenue and valuation so it’s worth a question: Who is responsible for these mistakes? In this case I don’t blame the CEO.
When you hand a kid (and let’s face it, a 20 something is still a kid, especially this generation who is over parented), who has ZERO management experience of a business, the checkbook and they keys to the car, don’t be surprised if they take it for a drive.
The AirBnB crisis and the Facebook privacy incidents was/are a fully avoidable situations, they are not “Black Swan” events. These are crises borne of incompetence fueled by inexperience and financed by arrogance.
You can’t realistically expect a 20 something boy to actually think ahead to how his system can be abused or how his users privacy can be violated. He doesn’t have the life experience to do it. He’s never managed a business. He’s learning on the job. He’s focused on valuation. He’s focused on “making it big”. You can’t realistically expect a 20 something boy to be compassionate to his customers and know how to handle a major PR crisis—most can’t even treat a girlfriend compassionately.
The same situation is happening at Facebook. Mark Zuckerberg’s a smart guy, but over and over again he persists in violating his customers’ privacy needs and this will impact his valuation at some point in the future. Is Mark accountable for these decisions? I argue No, because like Brian Chesky, he’s like a child-simply in over his head. Maybe also arrogant to believe he is special and that he doesn’t need experienced leadership–though at least Sheryl Sandberg has some voice in Facebook, she doesn’t appear to be able to keep the company from sticking its foot in its mouth.(May 2012 edit: as I re read this post on the eve of Facebook’s IPO; I have to say that my opinion of Mark has evolved. I still believe he is young, but he also appears to be learning very quickly and from all accounts is dedicated to learning how to be a CEO. Whether it’s seeking out experienced advice, or a preternatural maturity, he appears to be leading the company in a Gates/Jobs way that happens once in a generation and as a result I believe him to be an outlier. I will also add that I now would hold him responsible for major decisions since he holds 57% of the voting stock and appears to be firmly in control.)
edit: just read Paul Graham’s reponse to Mike Arrington and it only proves my point–Brian Chesky is not getting good advice. Here’s the investors’ response on all things D: “Not overly concerned.”
My point: Just because Mark Zuckerberg and Brian Chesky are smart guys with a great idea doesn’t make them great operators. Not saying you need to bring an army of MBAs either; but surely, you can do better. Next time, we all hope you’ll consider the value of experience, maturity, and dare I say, judgment, when managing your portfolios.
This leaves me with 2 questions:
- Did the board of AirBnB not warn Brian Chesky of the risks of operating without a risk management/crisis PR plan, or did AirBnB refuse that advice? If the former, should founders get to claw back shares when investors “fail” at their jobs? If the latter, should Chesky have been replaced?
- How should companies with young male technical founders compensate for potential downsides of arrogance, naivete, and lack of empathy?