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First published in Great Britain in 2017 by Bantam Press

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Corgi edition published 2018

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Copyright © Brad Stone 2017
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About the Author

Brad Stone is senior executive editor of global technology at Bloomberg News. He is the author of the New York Times bestseller The Everything Store: Jeff Bezos and the Age of Amazon, winner of the 2013 Financial Times and Goldman Sachs Business Book of the Year Award. He has covered Silicon Valley for nearly twenty years, writing for Bloomberg Businessweek, the New York Times, and Newsweek. He lives in San Francisco.

About the Book

Ten years ago, the idea of getting into a stranger’s car, or walking into a stranger’s home, would have seemed bizarre and dangerous, but today it’s as common as ordering a book online. Uber and Airbnb are household names: redefining neighbourhoods, challenging the way governments regulate business and changing the way we travel.

In the spirit of iconic Silicon Valley renegades like Steve Jobs and Bill Gates, a new generation of entrepreneurs is sparking yet another cultural upheaval through technology. They are among the Upstarts, idiosyncratic founders with limitless drive and an abundance of self-confidence. Young, hungry and brilliant, they are rewriting the traditional rules of business, changing our day-to-day lives and often sidestepping serious ethical and legal obstacles in the process.

The Upstarts is the definitive account of a dawning age of tenacity, creativity, conflict and wealth. In Brad Stone’s highly anticipated and riveting account of the most radical companies of the new Silicon Valley, we find out how it all started, and how the world is wildly different from how it was ten years ago.

ALSO BY BRAD STONE

The Everything Store
Gearheads

Upstart

Preface to the New Edition

THE FIRST TWO decades of the twenty-first century witnessed the birth of a remarkable new species of technology company: Startupus rapidus. These were firms that, in the span of a few short years, raised billions of dollars, spread around the world at startling speed, and showered their founders and earliest backers with unimaginable wealth.

These companies, chief among them the ridesharing firms Uber, Lyft, and Didi Chuxing and the home-sharing service Airbnb, confronted stodgy regulators, outdated laws, and antiquated ways of doing business. It would not be an exaggeration to say that these internet insurgents helped to transform the way we now travel inside and between cities. That is why I titled the original edition of this book The Upstarts: How Uber, Airbnb and the Killer Companies of the New Silicon Valley are Changing the World.

While these businesses remain some of Silicon Valley’s most promising still-private startups, the enduring nature of nonfiction book publishing makes writing about subjects that have yet to blossom into full-blown corporate adulthood a complicated affair. There was extra peril chronicling the kind of mutating technology companies profiled here – particularly their hard-driving, risk-addicted founders. Dramatic arcs can shift direction. Narratives change. What goes up often comes down.

Three weeks after the publication of this book, the hashtag #deleteUber started trending on Twitter. All of the early missteps made by Uber’s founder and CEO Travis Kalanick – many of them depicted in the following pages – had created a perception, especially among urban liberals, that Uber was an unethical company. In the wake of the 2016 presidential election, that reputation became toxic. Uber’s longtime critics seized on what they viewed as the company’s support of the Trump administration’s immigration policies to champion a boycott of the service. The #deleteUber wave gathered steam and then took on extra momentum when an exposé of sexual harassment inside the startup was published online by a former Uber engineer named Susan Fowler.

That was the beginning of Uber’s year of discontent: a nearly uninterrupted stream of bad news, boardroom drama, and revelations about abhorrent behavior by top executives, culminating in the ouster of Kalanick in June 2017. It was a stunning fall from one of the highest pinnacles of the business world.

Kalanick’s ouster triggered a debate in Silicon Valley and elsewhere over the kinds of leaders we want at the top of our most powerful institutions. Will they predominantly be men who are disciples of the cold, heartless algorithm, who prioritize growth, winning, and wealth creation at all costs? Or would the downfall of Kalanick usher in a new era, one in which the watchwords are empathy,ethics, and opportunity for all?

Now, at the very beginning of 2018, these questions dominate the intersecting worlds of media, technology, and politics. That is why I’ve retitled the updated and expanded edition of this book The Upstarts: Uber, Airbnb and the Battle for the New Silicon Valley.

Uber and its ilk were fighting for the souls of the world’s cities. But all along, there was a separate battle over theirs.

Introduction

IT WAS THE beginning of something remarkable. Nearly two million people poured into Washington, DC, the week of January 19, 2009, for the inauguration of President Barack Hussein Obama. But not everyone there was just bearing witness. Among the throngs that gathered to brave the mid-Atlantic-winter chill, two groups of young entrepreneurs from San Francisco were on the verge of not just watching history but making it.

The three founders of a little-known website called Airbedandbreakfast.com decided to attend at the last minute. Brian Chesky, Joe Gebbia, and Nathan Blecharczyk convinced a friend, Michael Seibel, the CEO of the streaming-video site Justin.tv, to go with them. They were all in their midtwenties and had no tickets to the festivities, or winter clothes, or even a firm grasp of the week’s schedule. But they thought they saw an opportunity. Their company had limped along for over a year with little to show for it. Now, the eyes of the world would be on the nation’s capital and they wanted to take advantage.

They found a cheap crash pad in DC, an apartment in a drafty three-floor house near Howard University that, like so many other homes during that desperate time, was in foreclosure. The rooms were unfurnished save for a pullout sofa, which the three founders gave to Seibel. At night they crowded onto the hardwood floor on airbeds (naturally) along with their host, the manager of a local restaurant.

Their host was actually a tenant waiting for his inevitable eviction. He lived in the basement apartment and had used the AirBed & Breakfast website to rent out the empty first floor and, to three other guests, his own bedroom, living room, and walk-in closet. Sensing a promotional opportunity, Chesky e-mailed the staff of Good Morning America about the closet, and a producer promptly included it in a roundup of unusual accommodations for the inauguration.¹

By day the founders and Seibel passed out AirBed & Breakfast flyers at the Dupont Circle Metro station. ‘Rent your room! Rent your room!’ they cried to the bundled-up commuters, who mostly ignored them. At night they met other AirBed & Breakfast hosts in the city, attended any inaugural parties they could get into, and answered multiple e-mails from a disgruntled customer – the guest in the basement bedroom. The woman had driven her Volkswagen bus from Arizona to DC with her support dog, a Chihuahua, and she apparently wasn’t too keen on the crowded accommodations. In a barrage of messages to the company’s e-mail account that week, she complained that she was certain she smelled marijuana, that the juice she’d left in the fridge had been taken, and that the house didn’t comply with Americans with Disabilities Act regulations.

At one point she threatened to call the police. The founders of the company sat just a few feet above her head, trying as best they could to assuage the anger of one of their few actual customers.

On the day of the inauguration, the group awoke at 3:00 a.m. to try to claim a good viewing spot in the National Mall. They walked two miles to get there, buying warmer coats, hats, and face masks at a kiosk in front of a Metro stop along the way. By 4:00 a.m. they had found a space on the green in the area open to the general public, a few football fields away from the presidential podium.

‘We just kind of sat back to back in the middle of the Mall and tried to stay warm,’ recalls Brian Chesky, now the billionaire CEO of that once-fledgling company, Airbnb. ‘It was the coldest morning of my life. Everyone cheered when the sun came up.’

Garrett Camp and Travis Kalanick also attended the festivities that week, and their experience was nearly as ignominious. A friend on the inaugural committee, the investor Chris Sacca, had convinced them to come. Kalanick, a Los Angeles native who had recently sold his startup to the web infrastructure company Akamai, made a twenty-five-thousand-dollar donation to the inaugural committee and split the expense with Camp. They were both in their early thirties, full of optimism about the coming transformative effects of technology despite the meltdown of the global economy. They were largely ambivalent about politics but didn’t want to miss a historic moment or, just as urgently, a seminal party.

They were also unprepared for the trappings of a presidential inauguration. A few days before the event, they flew to New York City and went shopping for tuxedos at a Hugo Boss outlet. Wary of looking like twins, Kalanick went with a bow tie, Camp a regular tie.

The night before the inauguration, they ended up stranded in a line outside the Newseum, trying to get into a party hosted by the Huffington Post. It was windy and cold and they had only one wool hat between them, which they took turns wearing, ten minutes each, back and forth, while frantically texting one of the party’s hosts, asking to be allowed inside.

On the big day, instead of waking up early like the Airbnb founders, Camp and Kalanick woke up late. Kalanick had rented a swank home near Logan Circle on the vacation-rentals website VRBO but it was a few miles away from the Mall, and no taxis were readily available. They ended up sprinting down the wide DC avenues for thirty minutes, side by side. When they finally got to their seats, perched with Sacca and his high-powered Silicon Valley friends above the inaugural platform, the sweat on their bodies cooled, giving way to an unbearable chill.

‘By the end of the day, I was definitely sort of pre-hypothermic,’ Kalanick recalls. ‘Everyone was like, “What’s wrong with you?” and I’m like, “I’m frozen.”’ Camp adds, ‘I grew up in Canada. I’ve been very cold. But that was one of the coldest experiences in my entire life.’

At the time, Camp had been trying to get Kalanick excited about a business idea he was developing that would allow anyone with a smartphone to call a black town car with a click of a button. Kalanick had been interested but not particularly enthusiastic, conceding that it was a good idea, just not necessarily a big one. Yet here was concrete evidence that such a service was needed. A car that could be summoned on demand from a phone, Camp noted, could be vital in big cities when other transportation options were unavailable.

‘See?’ Camp said to Kalanick as the crowd chanted ‘O-bam-a! O-bam-a!’ and the world waited for the new First Family to take the stage. ‘We really need this.’

Even back then, Camp was calling this proposed service by a name the world would soon know well: Uber.

That was eight years ago.

Much has changed since then – the president, for starters. But few changes have been as profound as those that were ushered in by those two groups of entrepreneurs sitting anonymously in the crowd that day.

They had plenty of help. The late Apple co-founder Steve Jobs introduced the first iPhone seven months before Obama’s inauguration. Two months after it, Jobs announced that the iPhone would run software programs, called mobile applications, or apps, from other companies. Other significant technology trends were converging at the same time. The social network Facebook, founded in a Harvard dorm room in 2004, was skyrocketing in popularity and persuading internet users to establish their identities online. The search giant Google was making it easier for other companies to integrate its mapping tool, Google Maps, into their own apps and websites. Computers and phones were getting cheaper and more powerful. Broadband internet use was skyrocketing.

All these intersecting trends produced the biggest tectonic shift in computing history since the invention of the web browser. In the span of ten years, a majority of the people in the modern world started to run large portions of their lives online, mostly through the slender slabs of plastic, glass, and silicon that they could hold in their hands and slip into their pockets.

The juggernauts Uber and Airbnb did not generate this technological wave, but more than any other companies over those eight years, they rode it and profited from it. The two companies, both in San Francisco, their headquarters only a mile apart, are among the fastest-growing startups in history by sales, overall market value, and number of employees. Together they have scrawled in the annals of entrepreneurship the most memorable stories of a third phase of internet history – the post-Google, post-Facebook era of innovation that allowed the digital realm to expand into the physical one.

They have attained these heights despite the fact that their businesses own little in the way of physical assets. Airbnb can be considered the biggest hotel company on the planet, yet it possesses no actual hotel rooms. Uber is among the world’s largest car services, yet it doesn’t employ any professional drivers or own any vehicles (save for a small, experimental fleet of self-driving cars). They are the ultimate twenty-first-century internet businesses, bringing not only new opportunities but new kinds of risks, often poorly understood, to those who provide and utilize their services.

Uber, as the world well knows, allows anyone to summon a vehicle with ease, track its progress on a virtual map, and then ride with a driver whose reliability is illustrated by a one-tofive-star rating. The rider pays without the awkward exchange of cash or the time-consuming swipe of a credit card. The brilliance of this seamless transaction is so widely accepted in the LCD-lit halls of Silicon Valley that it inspired a surge of similar businesses in the fields of food delivery, package pickup, babysitting services, and so on.

Airbnb has extended the experience of traveling abroad well beyond the manicured realm of the hotel and the central tourism district. The concept was simple: Allow anyone to make a spare couch, unused bedroom, vacant in-law apartment, or empty second home available to a traveler on a short-term basis. This idea was not necessarily novel (VRBO, HomeAway, Couchsurfing, and Craigslist did it first), but the elegance of the solution was unrivaled. Carefully selected photographs and reviews from previous transactions introduce the host and the guest to each other before they meet in person. Like Uber, cash is deleted from the equation; Airbnb collects the transaction fee from the guest when the lodging is booked and remits it to the host, minus its cut, after the stay is complete.

During those eight years, the two companies etched their brands into popular culture. Their names are nouns and occasionally verbs, used by retirees looking to earn extra money, millennials seeking authentic travel experiences, and young people who have no interest in owning expensive assets like cars. Uber has become a staple of rap songs (Drake: ‘’Bout to call your ass a Uber, I got somewhere to be’) and late-night monologues (Jimmy Kimmel: ‘About a quarter of Uber drivers are over fifty and many are much older than that. I guess you could think of it like Miss Daisy driving you’).

Airbnb has drawn plaudits from President Obama himself. ‘I just want to brag on Brian just for one second,’ he said at a press event with Chesky in Cuba on March 21, 2016, during the first trip to Cuba by an American president in over eighty years. ‘He’s one of our outstanding young entrepreneurs who had an idea and acted on it.’

The companies’ stories are different in many ways but similar in a few crucial ones. Their founders’ original motives were not stated in high-minded terms, like Google’s (‘Organize the world’s information and make it universally accessible and useful’) or Facebook’s (‘Make the world more open and connected’). Camp, Kalanick, and their friends wanted to ride around San Francisco in style. Chesky and his cohorts were looking for a way to make some extra cash when a conference came to town.

Both startups offered age-old ideas (share a vehicle, rent your home) with new twists and ended up fostering a remarkable degree of openness among people who had never previously met. In a previous decade, most of us would have stayed far away from someone’s private car or unlit home, scared by headlines about crime and by our mothers’ earnest warnings to avoid strangers. Airbnb and Uber didn’t spawn ‘the sharing economy,’ ‘the on-demand economy,’ or ‘the one-tap economy’ (those labels never quite seemed to fit) so much as usher in a new trust economy, helping regular folks to negotiate transportation and accommodations in the age of ubiquitous internet access.

The nearly simultaneous emergence of both companies has been striking. For most of its first year, Airbnb was a side project that many dismissed as wildly outlandish. Why would a sane person ever want to sleep in a stranger’s bed? Eight years later, investors valued the company at thirty billion dollars, more than any hotel chain in the world. Those founders who slept on the hardwood floor in Washington, DC? They are worth about three billion dollars each, at least on paper.²

Uber’s potential was underestimated even by its own creators, who saw the service as a useful tool in San Francisco, a city whose cab industry badly underserved the needs of a booming business capital. But the startup exploded out of San Francisco and into New York, Los Angeles, Chicago, London, Paris, Beijing, and nearly every other major city. Early adopters raved about it to friends, who then signed up. As the company introduced less expensive varieties of the service, substituting regular cars for town cars and carpools for individual rides, many people came to rely on it. Uber’s valuation in late 2016 was sixty-eight billion dollars, more than any other privately held startup company in the world. Kalanick and Camp have an estimated net worth of more than six billion dollars each.

Both companies’ journeys have been marked by nearly nonstop controversy. In many cities, Uber sidestepped laws requiring professional drivers to undergo rigorous training sessions, submit to fingerprint-based background checks, and acquire expensive, government-issued chauffeur licenses. It has encountered fierce resistance from taxi companies and lawmakers and been the focus of violent protests. Cabbies have shut down the Autobahn in Berlin, blockaded the roads around Orly Airport in Paris, beaten up Uber drivers in Milan, and menaced Uber employees in Mumbai. There are fresh battles every month, exacerbated sometimes by the startup’s own flat-footed moves and relentless grow-at-all-costs mentality and other times by the fiery resentment of incumbent taxi companies that have watched their businesses change with breathtaking speed. Uber is also the target of hundreds of lawsuits, many of which concern the legal status of its drivers, who are designated by the company as contractors, not employees. They get to set their own hours but enjoy none of the security of permanent employment.

Airbnb’s rise has been just as eventful. The company encountered laws in, among other cities, New York, Barcelona, Amsterdam, and Tokyo designed to thwart illegal hoteliers and limit the number of nights per year that people could rent out their homes. Lawmakers, activists, and hotel unions have criticized the company for worsening the housing shortage in desirable urban areas, driving up housing costs, and skirting hotel taxes. In late 2016, Airbnb actually sued New York City and its hometown, San Francisco, over legislation that threatened the company and its hosts with thousand-dollar fines every time a prospective host posted a listing on the service that violated the cities’ short-term-rental laws.

Together, these companies have come to embody a new business code that has forced local governments to question their faithfulness to the regulatory regimes of the past. Taxi medallions, municipal licenses to operate a cab, were an early twentieth-century invention meant to prevent an excess of cars on clogged city streets and assure riders that drivers were trained and vetted and knew how to navigate the city. Zoning laws and hotel and guesthouse ordinances kept commercial activity out of residential neighborhoods and ensured that hotel rooms were up to safety code. Airbnb and Uber substituted the self-policing tools pioneered by internet marketplaces like eBay – riders graded their drivers and guests evaluated their hosts, and vice versa.

Uber and Airbnb have also come to represent, at least to some, the overweening hubris of the techno-elite. Critics blame them for everything from destroying the basic rules of employment, exacerbating traffic, and ruining peaceful neighborhoods to bringing unrestrained capitalism into liberal cities. Some of that is overheated, but there were consequences to their approaches that even Uber and Airbnb did not anticipate.

At the center of this maelstrom are the young, wealthy, charismatic chief executives: Travis Kalanick and Brian Chesky. They represent a new kind of technology CEO, nothing at all like Bill Gates, Larry Page, and Mark Zuckerberg, the awkward, introverted innovators who typified the previous generation of tech leaders. Instead, they are extroverted storytellers, capable of positioning their companies in the context of dramatic progress for humanity and recruiting not only armies of engineers but drivers, hosts, lobbyists, and lawmakers to their cause.

Both were relatively unknown before moving their startups into the global business vanguard. Yet both have demonstrated extraordinary levels of ambition and boldness and a willingness to bet big despite the prospect of humiliating failure.

So how did it all happen? How did they maneuver past entrenched, politically savvy incumbents to succeed where others had failed and build large companies in a staggeringly short amount of time? How much of their success was luck? What does it take to survive and thrive in modern Silicon Valley?

These were questions, I judged back in 2014, that were ripe for exploration in a book. But the practical question was this: Would the startups cooperate with such an in-depth project? At most Silicon Valley tech companies, the time and public images of the top executives are obsessively guarded. Uber and Airbnb had graduated into this secretive sanctum.

The only way to find out was to ask.

Living up to its mission to foster hospitality, Airbnb promptly invited me to discuss the project. I met Brian Chesky at his company headquarters at 888 Brannan Street in San Francisco, a lavishly renovated former battery factory. The entrance to the building is majestic, with a five-story open atrium that is both striking and impractical; one three-story stretch of wall is furnished with a variety of plants that need almost constant care. Airbnb occupies several floors that have inspirational sayings etched on the walls and conference rooms decorated to look like exotic home rentals on the site.

I met Chesky in the Founders’ Den, a wood-paneled hold-over from a previous tenant, a paper-distribution company. Four brown leather armchairs surrounded a circular coffee table that sat on an oriental rug. It was an anachronism from the 1950s amid the splendor and excess of San Francisco’s twenty-first-century internet boom. Across the street, cranes were assembling new high-priced condominiums.

Chesky is five foot nine and fit from a regular workout regime. He spoke quickly, with spasms of tension occasionally passing over his mouth, and related the history of his company’s meteoric rise in terms of the moments of its most dramatic adversity.

Early in Airbnb’s history, he said, ‘It felt like the world was against us and everyone was laughing at us.’ The startup persevered through widespread rejection by investors, battled a ruthless European rival, and survived a deluge of negative publicity around the early destruction of one of its hosts’ homes by an unruly guest. ‘No one believed in us. We were insecure and had no idea what we were doing,’ he told me.

More recently, the primary adversaries have become regulators and housing activists. Some of them are looking to score political points by vilifying a high-profile target; others are legitimately worried about Airbnb’s impact on housing affordability. Unlike his friend Travis Kalanick, Chesky presents himself as a sympathetic ally of those in the latter category. ‘We want to enrich cities. We don’t want to be an enemy of affordable housing,’ he said. ‘I think we can be on the right side of the argument. We let many of our users stay in their own homes. This is why we were founded. If I didn’t need the money to pay rent, we wouldn’t have started the company.’

As for the book project, he was game. Over the ensuing year, I spoke to Chesky, his co-founders, and top Airbnb executives. The company’s PR representatives were helpful though understandably nervous about the outcome, soliciting questions for interviews ahead of time, sitting in on conversations, and taking copious notes.

Then there was the monumental challenge of obtaining the cooperation of the famously combative Travis Kalanick, known as a contrarian who advocated fiercely for his company’s interests. He did not disappoint. ‘I came to this meeting out of respect for you and your work,’ he said when we met for dinner in March 2015 at the Burritt Room and Tavern in San Francisco’s Mystic Hotel. ‘But I’m going into it thinking, There’s no way in hell I’m cooperating with a book about Uber right now.’

Kalanick had endured a year of negative press over Uber’s tactics toward rivals, its ambiguous impact on cities, and its tense relationship with drivers. David Plouffe, Obama’s former campaign manager and at the time Kalanick’s chief of media relations, came along for the dinner and wore the bemused smile of someone witnessing a journalist’s suicide mission.

Despite the inauspicious start, Kalanick seemed willing to listen. He asked what he had to gain by cooperating. ‘If you want people to embrace a radical future in which they give up their cars,’ I argued, ‘you have to allow journalists to explain and demystify your story. If you want to change the way cities work, Uber must be understood.’

It didn’t work. ‘You have to inspire me!’ he said. ‘Tell me what we have to gain!’ He was forthright and transactional; in other words, Travis being Travis.

At some point during the rye whiskey cocktails and flat-iron steaks with garlic-paprika fries, he seemed to warm briefly to the cinematic potential. ‘You’d start this story with a city council meeting,’ he mused. ‘The city council people are sitting up in front of the room and they are misinformed. They are thinking mostly about where their next campaign contribution comes from. There’s an Uber rep there, but he is basically alone, trying to describe an unfamiliar and strange technology to people who have no understanding of it.

‘The Uber guy has a lobbyist, but the lobbyist is also working for the other guys on the side. Finally, you have the big taxi guys there, and they have the city council locked up and paid for.

‘Then, meanwhile, you’d cut to the taxi guys at the airport. They are all waiting there for hours, playing cards or whatever, for the chance to pick up one fare. And there’s an Uber recruiter there, and he is surrounded, explaining this new system to the drivers …’ Kalanick caught himself and trailed off. ‘Anyway, that’s how you’d start the movie.’

On the street after dinner, he said again, ‘You have to inspire me,’ as if I hadn’t just spent two hours laying out my best arguments. Then he and Plouffe took off on foot, back to the office.

Six months passed, and despite my repeated entreaties, I didn’t hear anything. But then, after I’d talked to dozens of regulators, competitors, and current and former Uber employees, a new Uber PR executive somehow convinced Kalanick to cooperate. I eventually spoke with two dozen different Uber executives from all periods of the company’s brief history and had another few hours of Kalanick’s time to complement several interviews I had conducted with him over the course of my five years as a writer for Bloomberg Businessweek.

The result is this book. It is not a comprehensive account of either company, since their extraordinary stories are still unfolding. It is instead a book about a pivotal moment in the century-long emergence of a technological society. It’s about a crucial era during which old regimes fell, new leaders emerged, new social contracts were forged between strangers, the topography of cities changed, and the upstarts roamed the earth.

CHAPTER 1

THE TROUGH OF SORROW

The Early Years of Airbnb

THE FIRST GUEST to use Airbedandbreakfast.com was Amol Surve, a recent graduate of the Biodesign Institute at Arizona State University.¹ He arrived at his rental late in the afternoon on Tuesday, October 16, 2007, fifteen months before Barack Obama’s historic inauguration, and was greeted at the door by the site’s twenty-six-year-old co-creator Joe Gebbia, who politely asked him to remove his shoes.

Gebbia gave him a tour of unit C on the top floor of 19 Rausch Street, a narrow, side-street row house in San Francisco’s chaotic South of Market neighborhood. It was spacious, with three bedrooms, two bathrooms, a comfortable living room, and, up the main flight of stairs, a roof terrace overlooking the golden city, which was undergoing its own momentous reinvention. At the time, the two men had no way of knowing that over the next few years, this apartment would be ground zero for a worldwide social movement and global business phenomenon called the sharing economy.

Surve, a native of Mumbai, India, had used the internet to rent an airbed for eighty dollars a night during the World Design Congress, a biennial conference held by the International Council of Societies of Industrial Design, or ICSID. All the hotels in the city that week were either booked or too expensive for Surve, so he hadn’t expected much. But what he saw in his temporary home was promising. There was a shelf full of design books and a comfortable couch in the living room. He was invited to help himself to cereal and milk in the kitchen in the morning, and there was a small bedroom with an inflated airbed, sheets, and blankets. His hosts were surprisingly thoughtful; Gebbia presented him with a small bag that contained, among other things, the house rules, a Wi-Fi passcode, a city map, and some loose change for the neighborhood homeless population.

But by far the most surprising thing Surve saw that first afternoon was an image on Gebbia’s laptop – a picture of Amol Surve himself. Gebbia and his roommate and business partner, Brian Chesky, were putting together a presentation about their new home-sharing service for a pecha-kucha (Japanese for ‘chatter’), an event in which a series of designers present their new product ideas by showing twenty slides apiece and discussing each slide for twenty seconds.

As the very first guest of this new service, Surve had been included in the presentation. His stay hadn’t even begun yet and here he was, grafted into chapter 1 of what his hosts were clearly hoping would be a very long story. ‘It was very strange,’ Surve says years later.

Surve was happy just to have a comfortable place to sleep, but he ended up getting an education in the Silicon Valley startup scene as well. He spent lots of time that week on the couch with Gebbia and Chesky, talking about design and examining Apple’s new device, the very first iPhone. Surve hadn’t even heard of Steve Jobs, let alone the iPhone, and he was totally unfamiliar with the litany of motivational Jobs sayings that Gebbia and Chesky frequently quoted, such as ‘We’re here to put a dent in the universe.’

With another guest staying at Rausch Street, Kat Jurick, Surve attended the pecha-kucha, and later in the week, Gebbia took him on a tour of the city, showing him sights like the famous winding block of Lombard Street and the farmers’ market outside the Ferry Building. Gebbia, who liked to exhibit his design sensibilities with stylish items like colorful sneakers and trendy, oversize eyeglasses, sported an aviator hat with furry ears in the fall chill.

After the conference, Surve had an extra day in the city and wanted to see the famous d. school – the Institute of Design at Stanford University. Chesky wanted to see it too, so he offered to drive. At Stanford, the pair sat in the front row at a free lecture given by the Italian designer Ezio Manzini and afterward introduced themselves to Bill Moggridge, a co-founder of Ideo, the iconic design firm, and chairman of that week’s design conference.

It must have been an unusual sight: Moggridge, who passed away in 2012, was over six and a half feet tall. Chesky, who had the beefy frame of a hockey player and was a workout fanatic, was nine inches shorter. Staring up, the fast-talking Chesky launched into a description of AirBed & Breakfast, suggesting it could be the official accommodation for the Industrial Designers Society of America. As part of his impromptu pitch, he introduced Surve as the first guest, and Surve was once again conscripted into the story. Surve remembers Moggridge nodding without comment and looking skeptical.

Chesky would later say that AirBed & Breakfast was a lark and something of a side project at the time, but Surve remembers his new friend vibrating with enthusiasm for the idea on the forty-five-minute drive back to the city. ‘Amol,’ Chesky told him in the car, ‘we have to put a dent in the universe with this concept.’

Brian Chesky grew up in an eastern suburb of Schenectady, New York: Niskayuna, a town no one had heard of located outside a city most people couldn’t find on a map. His family was solidly middle class and lived in a five-bedroom Colonial house with a dog and a large backyard. His mom and dad, descendants of Italian and Polish immigrants, respectively, were social workers who doted endlessly on Chesky and his younger sister, Allison. When they weren’t at their jobs (where they occasionally bent protocol by inviting the individuals and families they counseled into their home), they spent their time catering to their children. ‘We had no life,’ says Brian’s vivacious mother, Deb. Adds his father, Bob, ‘Some people invest in their career. We invested in our kids.’

From a young age, Chesky gravitated toward drawing, paying frequent visits to the Norman Rockwell Museum, about an hour’s drive from his town. His parents marveled at his ability to sit and draw for long periods, and teachers favorably compared his style to Rockwell’s and made heady predictions about his future. ‘Your son is going to be famous one day,’ one told them.

He also played hockey and imagined himself as the next Wayne Gretzky. He was quick and agile and drew recognition around the region. But after he broke his collarbone twice, his high-school coaches finally decided that he was too short and not strong enough to have a real future on the ice. His parents seemed to agree. ‘He was too small to be a star,’ says Deb.

Unwilling to accept defeat, Chesky started working out and lifting weights, chugging creatine-and-egg-white shakes and adding muscle.

During his college years, he joined the bodybuilding-contest circuit, oiling up and flexing onstage in front of cameras and crowds at national bodybuilding competitions. ‘I did this before I realized the consequences of the internet,’ he said later, sheepish about the photographic evidence from that period of his life.²

Chesky’s friend and co-founder Joe Gebbia was born in Atlanta, Georgia, the youngest child of two self-employed sales reps who worked with independent health-food supermarkets across the south. With his older sister he would accompany his father on long road trips into Alabama, Tennessee, and South Carolina, peddling fruit and organic juices and sticking around after meetings to help store owners restock their shelves. Like Chesky, Gebbia straddled different worlds growing up. He played tennis and basketball and ran track and field but also studied the violin until deciding that all he wanted to do was play jazz piano like his idol Dave Brubeck.

Then one summer in the middle of high school, Gebbia took art classes at Valdosta State University in Georgia and decided that he really wanted to be a painter. ‘You’ve got something there,’ noted an instructor who admired his work, and he suggested Gebbia apply to one of the top art schools in the country, the Rhode Island School of Design. Gebbia spent the following summer taking classes at RISD and was enthralled by the majestic French and Neocolonial buildings clustered on the banks of the Providence River. Gebbia enrolled at RISD in 2000, a year after Chesky.

They met in classes and at student events and found each other easy collaborators. Chesky ran the school hockey team, the Nads (‘Go, Nads!’), while Gebbia managed the basketball team, the Balls (‘When the heat is on, the Balls stick together’). Running a RISD sports club was more a marketing challenge than a competitive one; the way they tell it, the teams cared less about winning than about using the games as excuses for campus high jinks.

Both gravitated toward the study of industrial design and the idea that they could make things that were as iconic and affordable as the classic Eames lounge chair. ‘You can live in a world of your own design,’ their professors insisted. ‘You can change the world, you can redesign it.’³ The department pounded a kind of practical idealism into the students’ heads; during one field trip, they were taken in buses to the city dump and driven through the caverns of trash so they could see where wasted effort ended up.

Chesky and Gebbia teamed up one summer to work on a project for the hair-dryer maker Conair and on another idea that bodybuilder Chesky dubbed the Chesky Solution. He had a notion to use PalmPilots and other mobile gadgets, along with body sensors, to track people’s health. Neither project went anywhere, but the duo solidified their friendship during long creative brainstorming sessions. ‘Everything for me came together because we had such a fun time working on that project,’ says Gebbia, who was always on the lookout for a business partner. ‘Our ideas were so original, and different than everybody else’s.’

Chesky was selected by his classmates to give the commencement address in 2004. In a video of the speech, he can be seen storming onto the stage to Michael Jackson’s ‘Billie Jean.’ Full of charisma and confidence, he strips off his graduation robe to reveal a white sport coat and matching tie, does a few dance moves, and flexes his muscles. Then he cracks up the audience for the next twelve minutes. ‘Parents, I want you to know that investing in us is better than any stock on the market,’ he said presciently. ‘Sure, you spent a hundred and forty thousand dollars so we could paint with Jell-O and roll around in Silly Putty. But more important, you knew we needed to be inspired and we found plenty of it here at RISD.’

Before Chesky left town to go back to Niskayuna, Gebbia took him for pizza and shared a prediction: One day, they would start a company together and someone would write a book about it. ‘I saw this gift he has, to be able to get people excited,’ Gebbia says. ‘I would have felt incomplete if I didn’t express to him what I was feeling.’

After graduation, Chesky spent a few months living at home, then he decamped to Los Angeles, moving in with former classmates in a Hollywood apartment amid the tourists and costumed panhandlers a few blocks from Grauman’s Chinese Theatre. His parents, still doting, bought a Honda Civic from an L.A. dealer and had it delivered to him at the Los Angeles airport.

He was living his college dream. He had a real job, earning forty thousand dollars a year as a designer for the consultant shop 3DID in Marina del Rey, working on toys for Mattel, guitars for Henman, medical equipment, footwear, dog toys, and handbags. ‘When you are a designer at school, especially an industrial designer, you just dream of getting something on the shelf,’ Chesky says.

But somehow that first job never quite matched his expectations. There was a ninety-minute commute each way in the suffocating gridlock on the I-405. Most of the projects he worked on never made it to stores or, if they did, ended up in landfills.

In 2006, Chesky’s firm was invited to participate in the Simon Cowell-produced reality-TV show American Inventor. His team was tasked with aiding a husband and wife with their concept for a bacteria-free toilet seat, called the Pureflush. The couple was competing against a dozen other inventors for a million-dollar grand prize. Chesky and his colleagues from 3DID were there to help them conceptualize the product and produce a prototype.

The episode aired on May 4, 2006. Chesky’s presence was largely edited out of the show, but you can see the future billionaire sitting quietly with colleagues in design reviews. In retrospect it is easy to see why the experience might have propelled Chesky farther down the path of youthful disillusionment. The husband, a part-time magician with a volcanic temper, started screaming when 3DID revealed its mock-ups of the toilet seat.

‘This one is way too small. That one is obviously way too big! End of story! This bullshit stops right here!’ he yells in the episode, to the shock of the designers (and, no doubt, the delight of the show’s producers). ‘You are not here to make it better! You are here to take our dreams and put them in physical form!’⁴

For Chesky, that unhinged criticism was cutting. At the time he was obsessively following the story of the fantastically successful founders of the video-sharing site YouTube; he was spending hours on the site as well as watching Steve Jobs’s keynote presentations and the television film Pirates of Silicon Valley. This was a universe where new things really did change reality. ‘I got kind of obsessed,’ he says. ‘I was living vicariously, escaping to a world where someone could build something and actually change something. I was not doing that. I was sitting in a dark office making stuff for closets and landfills.’

By early 2007, Chesky was antsy. He had moved to a two-bedroom apartment in West Hollywood with four friends and cut his hours at the firm to focus on making his own furniture. He designed a fiberglass chair with curves inspired by the hood of a Corvette Stingray, as well as a portion-control plate, a dish with an elevated center that could hold only a moderate-size, three-ounce piece of meat.⁵ Desperate to start something of his own, to make a mark and see his name in lights, he toyed with creating a design firm called Brian Chesky Inc.

Pirates of Silicon Valley,