Airbnb targets as much as $33B valuation for IPO

Range is higher than expected, showing its strength in the pandemic market

National /
Nov.November 30, 2020 09:07 AM
Airbnb CEO Brian Chesky (Getty; iStock)

Airbnb CEO Brian Chesky (Getty; iStock)

Airbnb executives plan to target a higher-than-expected valuation range of as much as $33 billion for its initial public offering, which is expected sometime next month.

On Tuesday, the company will start marketing its offering to mutual funds and hedge funds, the Wall Street Journal reported. The investor roadshow will take place via Zoom meetings, rather than the usual meetings across the nation.

Companies and their underwriters typically set a relatively conservative initial offering range, leaving some room to improve before trading starts. But in the case of Airbnb, the initial range is higher than expected. People close to the company’s offering thought the offering would be $30 billion, according to the publication.

The higher-than-expected pricing may be a reflection of the short-term rental company’s rebound from the early days of the pandemic.

At the onset of the pandemic, people stopped traveling, and Airbnb’s valuation took a nosedive to $18 billion from the $31 billion mark set in a 2017 investment round. Bookings at Airbnb rebounded by summer as people preferred to stay in short-term rentals rather than hotels.

But the pandemic still pummeled the company’s finances: According to its S-1 prospectus, filed in November, bookings totaled $18 billion as of Sept. 30, a 39 percent year-over-year drop. Revenue for that period dropped 32 percent, to $2.5 billion.

Airbnb and its underwriter will set the final IPO price based on feedback from investors in the virtual roadshow. Morgan Stanley and Goldman Sachs are leading Airbnb’s IPO.

[WSJ] — Akiko Matsuda


Related Articles

arrow_forward_ios
From left: Mayor Bill de Blasio, 54 West 39th Street, 62 Grand Street, and 208 West 30th Street (Credit: Google Maps)

The Airbnb crackdown continues: City targets three more buildings

The Airbnb crackdown continues: City targets three more buildings
Mayor Bill de Blasio and Stanley “Skip” Karol, an Airbnb host (Credit: Getty Images and Youtube)

Airbnb host narrowly clears hurdle in First Amendment claim against city

Airbnb host narrowly clears hurdle in First Amendment claim against city
A West Village Airbnb listing (Credit: Airbnb)

Airbnb Luxe launched without listings in one of their biggest potential markets — why?

Airbnb Luxe launched without listings in one of their biggest potential markets — why?
Airbnb Brain Chesky and President-elect Joe Biden (Getty)

Airbnb cancels all DC-area bookings for inauguration week

Airbnb cancels all DC-area bookings for inauguration week
Damien Dwin of Lafayette Square Holding (Photos via Lafayette; iStock)

Sustainable housing is focus of Damien Dwin’s social justice effort

Sustainable housing is focus of Damien Dwin’s social justice effort
Airbnb's Brian Chesky (Getty)

Airbnb says it will ban Capitol rioters ahead of inauguration

Airbnb says it will ban Capitol rioters ahead of inauguration
Jamie Cohen and Vacasa CEO Matt Roberts (Photos via Vacasa; Bussiness Wire)

Vacasa hires new CFO to lead “next stage of growth”

Vacasa hires new CFO to lead “next stage of growth”
From left: Sanjay Banker, Francis Davidson, Satyen Pandya and Christian Hempell (LinkedIn; Skift; Sonder)

VC-backed Sonder beefs up executive suite

VC-backed Sonder beefs up executive suite
arrow_forward_ios

The Deal's newsletters give you the latest scoops, fresh headlines, marketing data, and things to know within the industry.

Loading...