Airbnb survived Covid, but the crisis mode in “sharing” economy stays

In this weekly series, CNBC takes a look at companies that made the inaugural Disruptor 50 list, 10 years later.

It’s hard to think of a more quintessential story in disruption than Airbnb — the company made CNBC’s Disruptor 50 list eight times, more than any other company in the last decade, prior to going public at the end of 2020.

And years from now, it’ll be hard to imagine how any company, much less a travel company, made its market debut at the height of a global pandemic the way Airbnb did.

To get through the crisis, the company laid off about 25% of its workforce — about 1,900 of its 7,500 employees — and raised $2 billion in a combination of equity and debt to shore up its balance sheet. The equity portion of the deal valued Airbnb at $18 billion, nearly half of what the company was worth in 2017. At the time, Airbnb also decided to “pause” activities that did not directly support the core of its host community, such as transportation and Airbnb Studios, and scaled back its investments in hotels and luxury properties. 

But as Sequoia Capital partner Roelof Botha told CNBC’s Deirdre Bosa just months before the IPO — after a company that once topped the Disruptor 50 list had just fallen to No. 41 due in large-part to the pandemic — “like all businesses that involve human interaction, the sharing economy took a huge hit when Covid emerged and shelter-in-place was enforced … but people are itching to get out of their homes.”

His thesis was validated when Airbnb shares ended up 112% on its first day of trading, blowing past the market caps of giant travel industry incumbents like Booking Holdings, Expedia, and hotel chains like Marriott and Hilton.

In 2022, it has been a different story, with Airbnb shares negative on the year, but the stock has held up better than other growth-oriented companies and the overall tech-heavy Nasdaq Composite, which is down about 12% year to date.

“When we started Airbnb, it was about belonging and connection. This crisis has sharpened our focus to get back to our roots, back to the basics, back to what is truly special about Airbnb — everyday people who host their homes and offer experiences,” said co-founder and CEO Brian Chesky in a letter to his employees on May 5.

Airbnb implemented measures to keep its guests and hosts happy, but the result was a wave of criticism for seemingly every step it took. Airbnb has also teamed up with rival Vrbo, owned by Expedia, to combat the issues.

Problems are recurring for other notable Disruptor 50 companies in the gig economy such as Uber, which has also struggled with user satisfaction, as well as supply and demand imbalances amid the pandemic.

Just weeks ago Chesky, who is now on a nationwide tour of Airbnb stays in an effort to “improve the experience” for customers,…