Airbnb Confidentially Files to Go Public, Could Hold IPO By Year End

Airbnb Confidentially Files to Go Public, Could Hold IPO By Year End

After postponing plans to file for an initial public offering earlier this year in the wake of the coronavirus pandemic, Airbnb yesterday announced it has confidentially filed with the Securities and Exchange Commission to go public.

In 2017, Airbnb CEO Brian Chesky said his company was halfway through a two-year plan to go public, while the company said in September 2019 that it expected to become a publicly traded company "during 2020". But it goes without saying that the pandemic-driven collapse in vacation travel has hit the company hard: it shored up its finances in April by raising $1 billion, and let go of 25% of its staff a month later.

The comeback for travel following the first peak of the pandemic was faster than expected, though, helping keep Airbnb's plans for a public market debut moving ahead.

"Airbnb has been one of most eagerly awaited IPOs among the tech unicorns, likely to be valued at a staggering US$38bn".

However, there have been signs of recovery in the sector as the number of bookings were off 30 percent in June from a year earlier, the Bloomberg report said, compared with a 70 percent year-over-year decline seen in May. "Because of this, we need to make more fundamental changes to Airbnb by reducing the size of our workforce around a more focused business strategy".

United States stock markets have surged in recent months, with the benchmark S&P 500 index hitting a record high this week.

"While it's risky for any company in the travel industry to be going public this year, there's growing evidence investors think tech platforms are going to control a larger portion of the economy, Sundararajan said", Carville and Tse add. The ban is an extension of an already existing rule Airbnb implemented in late 2019, and represents the company's latest attempt to alter its business in the face of the coronavirus pandemic. In that economic damage, Airbnb's valuation dropped from Dollars 31 billion to USD 18 billion.

Coming into its IPO, Airbnb has raised $5.4 billion, according to Crunchbase, from investors that include Andreessen Horowitz, Manhattan Venture Partners, Sequoia Capital, TCV, Firstmark and Altimeter Capital.

IG will be offering a 'grey market' before the IPO is held, enabling you to speculate on Airbnb's share price before it lists.