The increasing value and reach of San Francisco-based Airbnb is making it increasingly likely that the company will go public sometime soon, a new report says, as investors in the home-sharing network begin to look for a return on their money.
Aibnb is currently the third most valuable privately held company, behind San Francisco-based ride hailing service Uber and Chinese smartphone maker Xiaomi Corp.
“Those venture funds are going to want the return on that investment, and since it’s unlikely that Airbnb might be bought by another company at its now incredibly lofty valuation, an IPO is the likeliest eventual exit,” Business Insider reports.
“So while it’s unlikely that will happen in 2017, an eventual IPO is probably not far off.”
Business Insider goes on to posit that Airbnb’s business model, successful negotiation of regulatory clashes in individual markets, and whopping valuation all make it a rich candidate for going public sooner rather than later.
Airbnb did not respond to a request for comment from the Business Times on Friday. Airbnb has said it expects to see $10 billion in revenue in 2020, and its market capitalization is bigger than both Hilton and Marriott International (NASDAQ:MAR).
Still, a funding round and employee stock sale last June valued the company at as much as $30 billion was said at the time to be designed to help it avoid going public just yet, the Wall Street Journal reported.
The Business Times reported on the initial fund raising. But citing people familiar with the matter, the paper reported that the $750 million funding push is crucial to helping Airbnb stay a privately held company for as long a possible. A separate deal will let investors buy $200 million of stock from Airbnb employees.
Source: Biz Journals