Airbnb
Airbnb expects to file for an IPO in 2020 [Credit: USA Today]

Airbnb sets 2020 as target for initial public offering

US: Airbnb, the world’s largest broker of private lodging for tourists, has announced in a brief statement that it expects to become a public trading company in 2020.

The home-sharing firm, which claims to have seven million listings in over 100,000 cities on its platform, had looked set to go in for an initial public offering (IPO) this year but this has now been held back for next year. Its previous valuing was recorded at $31bn two years ago.

However, it has yet to clarify if it has filed its S-1 IPO documentation which would present financial information for potential investors to analyse ahead of an offering.

Airbnb’s announcement comes a matter of days after the parent company of office-share provider WeWork, We Company, revealed it had had to delay its IPO after its $47bn valuation by the principal investor, SoftBank, was met with questions by a number of potential investors in the firm.

In the past twelve months, Airbnb has accelerated efforts to diversify from its core home-sharing business.

In November last year, it launched its Backyard project, which builds new homes to be operated as short-term rentals, and CNBC is reporting that prototype testing will get underway before the end of 2019.

In April, Airbnb officially acquired hotel booking service HotelTonight, at a time when the likes of Marriott and Four Seasons are verging towards the rental market, with the former in particular launching its ‘Homes & Villas by Marriott International’ platform.

The company is also focusing on the luxury end of the market by partnering with RXR Realty to operate apartment-style suites under a master lease model at New York’s iconic Rockefeller Center, and rebranding its top accommodation tier as ‘Luxe’.

Its overall aim is to become an all-in-one, end-to-end travel portal for travellers to book whichever accommodation they desire in whichever location they want.

This week, Airbnb also revealed it had generated more than $1bn in revenue for Q2 of this year although it gave no details about whether this led to an overall profit.

A number of tech-focused startups hoping to go in for an IPO this year have faced issues over proving their profitability potential to prospective investors, such as Uber and Lyft, but market analysts believe Airbnb will fare better.

Kathleen Smith, principal at Renaissance Capital, told Reuters: “I think it’ll be a whole different reception for Airbnb, assuming that they can show they’re a profitable business without having to lose money on marketing.”

Airbnb did not disclose any details about how it will list its shares, though these are expected to be revealed closer to the time of the IPO.

For more information, visit the Airbnb website here.

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