Fortune

Coping With a Bad Trip at Airbnb

FOR AIRBNB, HALLOWEEN STARTED OUT FESTIVE—AND QUICKLY TURNED FRIGHTENING.

Inside the company’s San Francisco headquarters on the morning of Oct. 31, employees wore costumes and smiles. Cofounder and CEO Brian Chesky was grinning in chef’s whites, handing out “Chesky’s Chips” cookies to staffers. One of tech’s best-known CEOs was role-playing as a pastry chef in a nod to an upcoming product launch—a new category of “Experiences,” centered around cooking, that travelers could book through Airbnb.

But even as they snacked, employees were hearing about an exposé published earlier that morning, one that was inching closer to virality with each furious retweet. The website Vice had uncovered an Airbnb scam that spanned at least eight cities and nearly 100 listings. A shady management company was relying on fake identities to con guests, booking them in attractive-but-phony listings and then redirecting them to flophouses. The article illustrated how easy it was to exploit Airbnb’s lax oversight and how little Airbnb did to help victims, logistically or financially. The reporter, Allie Conti, had been ensnared in the scam; she would later tweet that the FBI had contacted her about her article but that she “still [hadn’t] been able to have a meaningful conversation with a human being at Airbnb.”

The news would get far grimmer before Halloween was over. Just before 11:00 p.m. in Orinda, Calif., an affluent Bay Area suburb, inside a home booked through Airbnb, gunfire erupted during a party, leaving five dead and four others injured. The gathering had been promoted on social media as a “mansion party”; more than 100 people were present when police arrived. The home’s owners did not hide their frustration. “Airbnb does not release the customer information before they really book, so we have no way to know [their intentions],” Michael Wang told the San Francisco Chronicle. His listing included a guest limit and an explicit prohibition against parties, Wang continued, “but people lie.”

Concerns about fraud and safety have shadowed Airbnb throughout its rise. But the shooting and the Vice article, both widely picked up by other news outlets, dragged those issues into the foreground at a particularly inopportune time: Just six weeks earlier, Airbnb had announced its intention to go public in 2020.

With trust plummeting among investors and customers, Airbnb’s leaders scrambled. Over the ensuing week, while in New York City for a conference, Chesky canceled meetings and cleared his

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