Ex-Airbnb exec returns to hotels
Conley brings back insights learned at startup
“At some point I realized I wanted some space back in my life.” Chip Conley, on his decision to leave Airbnb
“Is it too cold?” Sprawled in a turquoise velvet chair, Chip Conley fiddled with the temperature controls for the hotel room at Laurel Inn in San Francisco’s Presidio Heights neighborhood.
He pulled over a small round ottoman and put up his feet, clad in tri-tone oxfords from Baja California, where he lives halftime, when he’s not at his Potrero Hill house. Many hotels save money by omitting comfy details like this, he said. But to stay fresh, hotels need to cater to evolving tastes for “unique and flavorful lodgings” that feel more homelike — a penchant propelled in part by his former employer, Airbnb, for which he still consults.
Despite his affable demeanor, Conley viewed by some as the hotel industry’s Darth Vader: He crossed enemy lines four years ago to join a startup that is upending the traditional hotel business. Now, several months after leaving Airbnb, he has plunged back into the hotel world, bringing some of the lessons learned as the company’s global head of hospitality and strategy. At Airbnb, Conley traveled
the globe as the company’s main liaison to its million hosts and helped them act more like hoteliers, providing a smoother experience and consistent standards for things like cleaning.
Conley, 56, is a guy who worries about details while also heeding the big picture. That stood him in good stead when he built San Francisco’s Joie de Vivre from a decrepit Tenderloin motel into the world’s second-largest boutique-hotel company, eventually selling the management company and brand to the family behind Hyatt Hotels in 2010 for an undisclosed sum, while retaining ownership stakes in 16 hotels (that’s now down to eight).
And it informed his tenure at Airbnb, where he started as a part-time consultant to CEO and co-founder Brian Chesky, who quickly piled on more responsibilities.
Twice the age of most of his cohorts, Conley felt like both a mentor and an intern at the same time. “I was a babe in the woods,” about technology and how to scale globally, he said. But he was also the only person at the then-350person company who came from the hospitality or travel industry.
Conley ducks questions on Airbnb controversies, such as its impact on tight housing markets, the sometimes hostile reception from cities and neighbors, and its recent deal with San Francisco — forged after a judge forced it to the negotiating table — to help register its hosts after years of fiercely resisting the idea.
The one hot-potato issue he’ll discuss is its impact on hotels.
With more than 3 million listings worldwide, Airbnb dwarfs the world’s biggest hotel chains. Marriott has about 1.1 million rooms; Hilton has 774,000. The startup can continue to grow far more rapidly than its brick-and-mortar rivals since it simply has to sign up more hosts, rather than actually build rooms.
That has hotels rattled. The American Hotel and Lodging Association, an industry trade group, discussed a multipronged campaign to thwart Airbnb at its November meeting, according to the New York Times.
But Conley thinks Airbnb is expanding the travel market, appealing to people who wouldn’t travel or would take much shorter trips if it didn’t exist. He points to Smith Travel Research’s reports that Airbnb impact on hotels is fairly negligible. Of course, there are other reports from the likes of Morgan Stanley that say Airbnb poses a threat to traditional hotels.
If anything, it’s boutique hotels in residential neighborhoods that are most challenged by Airbnb, Conley said. “Now they have competition in the neighborhood that didn’t exist before. Neighborhood hotels need to reinvent themselves to be the best of both worlds.”
Case in point: The Laurel Inn, a 49-room hotel in an upscale residential neighborhood, 28 percent owned by Conley, felt generic and dated, like a motor inn. With his suggestions, the rooms were renovated to appeal to the same folks who like staying in private homes through Airbnb. Already relatively large at 400 square feet, many now feature kitchenettes and dining areas, eclectic art from local artists; and other personal touches. There’s a book club in collaboration with a nearby Books Inc. and savings for extended stays.
Another strategy hotels can take is to offer Airbnb-style lodgings alongside traditional offerings, he said. Europe’s Room Mate Hotels now offers shortstay urban apartments through a brand called Be Mate. AccorHotels, Europe’s largest hotel group, bought London’s OneFineStay, an upscale version of Airbnb.
Despite stepping down from Airbnb in January, Conley still puts in 20 to 30 hours a month as a strategic consultant to the cofounders and other top executives. Why leave one of the tech world’s hottest startups?
“It was only supposed to be 15 hours a week: mentor Brian, create a hospitality ethos,” he said. “It quickly turned into a lot more, creating learning and development, head of strategy, head of business development. Fifteen hours a week quickly became 15 hours a day.”
While he loved his time at Airbnb, he had never wanted a job, he said, and he has no regrets about exiting before its potential, hotly anticipated initial public offering, date still unknown. It wasn’t the money but the challenge that drew in him, he said.
Leaving before his four-year anniversary “meant I was making a lifestyle choice and giving up some compensation, some vesting,” he said. “But at some point I realized I wanted some space back in my life.”
He’s now plunging into myriad projects, personal to professional. He’s learning to surf and writing his fifth book, “Modern Elder,” about how people can stay relevant after age 45. He’s also updating a previous book. He gives speeches to groups like Stanford Medical School and the Milken Summit. With an ownership stake in seven Joie de Vivre hotels, including the Laurel Inn, plus two others, he’s lending a hand with them, bringing to bear insights he gained at Airbnb.
“Boutique hotels helped pave the way for Airbnb because they sent the message that predictability as defined by Sheraton and Holiday Inn-type chain motels was waning in importance for travelers,” he said. “They showed people willing to be more adventurous in where they’d stay.”
On the other side, “if there’s one thing Airbnb has proven, it’s that people want to ‘live like a local’ ” he said, making air quotes.