PR Nightmare Forces SF Startup to Apologize

Airbnb is worth $1 billion in some circles, it can afford a $50,000 insurance policy.

The young San Francisco startup that allows users to rent out, or rent in, homes while traveling is making moves to end a PR nightmare.

A San Francisco woman's recent terrible experience with Airbnb made national headlines.

In an experience the woman identified as EJ described as being "violated" on her blog, the woman said a guest staying in her home through Airbnb broke through a locked closet and stole her camera, laptop, iPod and made photocopies of her birth certificate and social security card.

After several back and forths with the company, Airbnb publicly issued an "unconditional apology" and says it will now insure users up to $50,000 in damages.

Airbnb CEO Brian Chesky said the new program will go into effect start Aug. 15.

"With regards to EJ, we let her down, and for that we are very sorry," he wrote on the company's blog. "We should have responded faster, communicated more sensitively, and taken more decisive action to make sure she felt safe and secure.

"But we weren’t prepared for the crisis and we dropped the ball. Now we’re dealing with the consequences. In working with the San Francisco Police Department, we are happy to say a suspect is now in custody. Even so, we realize that we have disappointed the community. To EJ, and all the other hosts who have had bad experiences, we know you deserve better from us."

The guarantee will also be retroactive to hosts who reported damage before the Aug. 15 start date, which means the San Francisco woman will be covered. Meanwhile the San Francisco Police Department is investigating the alleged crime, which was turned into a Taiwanese cartoon.

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