The Airbnb CEO has a new way of describing the current state of the tech industry. And it’s a twist on Warren Buffett’s “Skinny Swimming”
The era of “exuberance and euphoria” in the tech industry is coming to an end, according to Airbnb CEO Brian Chesky.
He has plenty of release dates to back him up.
A wave of job cuts has swept the tech industry in recent weeks. Earlier this month, Facebook’s parent company Meta announced it would cut 11,000 jobs. Amazon announced this week that it is planning mass layoffs, though it didn’t quite confirm a report that said it would cut 10,000 employees and introduce a hiring freeze into next year. And just a week after becoming Twitter’s new owner, Elon Musk fired around half of the company’s workforce, and in some cases locked them out of their corporate accounts, before receiving any official notice.
“It’s like we’re all in a nightclub and the lights just came on,” Chesky told CNN on Thursday, putting a new spin on legendary investor Warren Buffett’s famous saying about swimming and recessions: “Only when the tide goes out.” , do it and you will find out who has been swimming naked.”
In short, the music has stopped for the tech sector, where market caps plummeted after decades of low interest rates and low inflation that ended this year: a conclusion to the so-called free-money era.
Last month, JPMorgan CEO Jamie Dimon used a sports metaphor during a earnings call: “My experience in life has been that you have things like what we’re going through today, there will be other surprises. Someone will be sidelined” – in another twist on Buffett’s famous statement.
Chesky has made the media rounds to celebrate his own company’s resilience and bold plans for the future wealth on Airbnb’s new offerings amid a slowing economy. But for a man whose company survived a near-death experience when most travel ground to a halt in 2020, he had some thoughts on changes the tech sector can implement in terms of recruiting and hiring.
“Two and a half years ago, we lost 80% of our business in eight weeks,” Chesky said. “People predicted that we would go out of business.” As for his tech peers…
“I think Silicon Valley has done so many amazing things for the world, but we have to be careful about fetishizing new technology as if the new technology will solve all the problems that the last technology created,” Chesky said. “We need more diversity in Silicon Valley, but that diversity shouldn’t just be demographic diversity. We need artists, humanists in this industry.”
Unlike other tech companies, Airbnb doesn’t have layoffs. The company laid off 25% of its workforce two months into the pandemic as the entire travel industry collapsed in the face of government-mandated shutdowns and travel bans.
“We just lay down,” he added. “We rebuilt the company from the ground up and stayed very lean.” And now, according to Chesky, “let’s step on the gas, we’re not stepping on the brakes.”
said Chesky wealth that a recession could actually prove to be an opportunity for Airbnb and people looking to make extra money.
“We want to get more people to share the houses they live in, whether they’re there or not,” Chesky said in an interview with assets Trey Williams this week. “The economy will likely continue to slow down. If that’s the case, people will want to make extra money more than ever. One of the best and easiest and most straightforward ways to make extra money is [to] Take on the biggest expense of your life — for most people, it’s your home — and cover the cost by sharing it when you’re not using it.”
Either way, Chesky said, this is the “ultimate reality check” for the tech industry, and executives need to “look around carefully.”
The tech wake-up call we’re seeing now, with giants that seemed pandemic-proof now reporting lower profits and cutting costs, could also be an indicator of a looming recession. While not a recession warning per se, the layoffs prove these companies are worried — and the nightclub lights may not be turning off for a while.
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