Airbnb confidentially files to go public

Home-share startup saw revenues plunge after pandemic hit

Airbnb's Brian Chesky (Getty)
Airbnb's Brian Chesky (Getty)

Airbnb has confidentially filed to go public, following a dramatic dip in revenue as a result of the pandemic.

The home-share startup announced the move in a statement on its website Wednesday, noting that the number of shares to be offered and the price range for the proposed offering are yet to be determined.

“The initial public offering is expected to take place after the SEC completes its review process, subject to market and other conditions,” the statement said.

Airbnb, which was founded in San Francisco in 2008, has been under pressure to go public since it announced its intention last September. However an initial IPO target date of March 2020 came and went as global travel ground to a halt, wiping out much of Airbnb’s business.

Instead, CEO Brian Chesky bought more time by securing $2 billion in debt and equity from Silver Lake and Sixth Street Partners. But the funding came at a price. Airbnb was most recently valued at $18 billion, down from an earlier valuation of $31 billion. In May, Airbnb laid off nearly 2,000 employees — roughly a quarter of its staff — after revenue dried up.

At the time, Airbnb also said it expected its 2020 revenue would be less than half what it was in 2019. Airbnb generated $4.8 billion in revenue last year. This month, Bloomberg reported the company’s revenues fell in the second quarter by almost 70 percent.

Airbnb’s business appears to have roared back to life in recent weeks, as travel resumed. Between May 17 and June 3, bookings topped last year’s volume, according to research firm AirDNA. As of June 17, bookings were up 20 percent year over year.

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The company’s public offering will be closely watched: In addition to its falling revenues, Airbnb has a long trail of regulatory disputes it’s been working to address ahead of its debut. Earlier this year, the company reached a settlement with New York City over a longstanding data-sharing dispute. As part of the agreement, Airbnb agreed to hand over listing information about its hosts on a quarterly basis.

Ironing out those disputes has been a key part of Airbnb’s IPO preparation. In the wake of WeWork’s failed IPO last year, well-funded startups have faced scrutiny over everything from finances to board diversity. The embattled co-working firm filed a prospectus last August, revealing massive losses and a host of governance issues. The IPO was called off in September.

Airbnb did not indicate whether it would pursue a traditional IPO, direct listing or deal with a blank-check company or special purpose acquisition company (SPAC).

Chesky previously indicated that Airbnb had been approached about a deal with a blank-check company or SPAC. “We’re looking at everything,” he said at a Reuters even last month. “So I probably shouldn’t speculate too much on it.”

At the same event, Chesky said Airbnb had to put its IPO on ice because of the pandemic.

“We had a bit of fire-fighting to do. We’ve now kind of dusted that off,” he said. “And we’re back to working and being prepared.”

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