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 12:30 PM
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
Harvey Hernandez and Cindy Diffenderfer (Patrick McMullan/Getty; iStock)

Harvey Hernandez’s former partner seeks to put NGD Homesharing in receivership

Harvey Hernandez’s former partner seeks to put NGD Homesharing in receivership
Miami Beach Mayor Dan Gelber and 1531 Stillwater Drive (Getty, Zillow)

Miami Beach slashes fines for illegal short-term rentals

Miami Beach slashes fines for illegal short-term rentals
Opera Tower (Wikipedia, Airbnb)

Opera Tower condo association sues Airbnb amid short-term rental crackdown

Opera Tower condo association sues Airbnb amid short-term rental crackdown
An illustration f Mayor of Miami Beach Dan Gelber (Credit: Nicholas Hunt/Getty Images)

Miami Beach to allow short-term rentals in condos, hotels

Miami Beach to allow short-term rentals in condos, hotels
The appeals court \rejected Miami Beach’s petition to overturn a ruling that determined that the city’s exorbitant fines for short-term rental violators ran afoul of state law (Airbnb, iStock)

Miami Beach racks up another court loss over short-term rental enforcement

Miami Beach racks up another court loss over short-term rental enforcement
Rafael Serrano and 3098 Alton Road

Appeals court rules Miami Beach cannot shut off water for nonpayment of short-term rental fines

Appeals court rules Miami Beach cannot shut off water for nonpayment of short-term rental fines
Miami Beach Mayor Dan Gelber (Credit: EVA MARIE UZCATEGUI/AFP via Getty Images)

Miami Beach shuts down short-term rentals due to coronavirus

Miami Beach shuts down short-term rentals due to coronavirus
Harvey Herndandez

Airbnb settles litigation with Miami development group alleging fraud

Airbnb settles litigation with Miami development group alleging fraud
arrow_forward_ios

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

Loading...