Airbnb, the popular accommodation rental marketplace, recently filed with the U.S. Securities and Exchanges Commission (SEC) for a long-awaited initial public offering. The company is looking to go public 12 years after its founding and a whopping $6.4 billion in equity and debt financing raised over the years.

Airbnb had a rough year, especially in the early months of the coronavirus pandemic that widely dwindled its business. It’s such that the company resorted to raising $2 billion in urgent debt and equity funding in April this year to cushion the financial woes that the coronavirus pandemic brought to its business. 

In recent months, Airbnb has gradually recovered and even reported a profit of $219 million on $1.3 billion in revenue in the third quarter of this year, after having laid off 25% of its workforce in May.

In this article, we provide a peek into Airbnb’s finances over time.

Revenue

In 2019, Airbnb posted $4.8 billion in revenue and a net loss of $674 million in the same year. In the years before that, the company’s revenue breaks down into;

• 2018 – $3.7 billion and a net loss of $16.9 million
• 2017 – $2.6 billion and a net loss of $70 million
• 2016 – $1.7 billion and a net loss of $147 million
• 2015 – $919 million and a net loss of $135 million

After growing rapidly over the years, Airbnb’s revenue went down this year mostly due to the coronavirus pandemic, with the company posting $2.5 billion in revenue in the first nine months of 2020, compared to $3.7 billion in the same period last year. Between this year and the last, Airbnb’s losses more than doubled from $323 million to $697 million.

Over the past five years, Airbnb hasn’t posted an annual profit, contrary to previous reports of the company having done so such as one from Bloomberg in 2018 that reported the company having turned a profit of $93 million on $2.6 billion in revenue in 2017. Given Airbnb’s public numbers, the report got the company’s revenue exactly right but not its profitability status.

Founders and Investors

Airbnb CEO Brian Chesky (right) and former Chief Operating Officer Belinda Johnson (left). They’re both set for major monetary wins from Airbnb’s imminent IPO. Photo credit: “Fortune Conferences, licensed under CC BY-NC-ND 2.0

A host of shareholders including Airbnb’s three founders and a handful of venture capital firms are in line to reap big amounts from Airbnb’s public offering. Given the shareholding information provided by Airbnb in its S-1 prospectus and matching with the company’s reported share price of $34.88, its three co-founders are set to reap at least $7 billion between them from Airbnb’s IPO.

Other shareholders with stakes amounting to hundreds of millions of dollars each include venture capital firm Founders Fund and DST Global. Another venture capital firm, Sequoia Capital, whose partner Alfred Lin sits on Airbnb’s board, is set to reap nearly $3 billion from Airbnb’s IPO.

Along with founders and outside investors, other Airbnb executives, both current and former, are also set for lucrative stakes, among them the company’s former Chief Operating Officer Belinda Johnson, current board member Kenneth Chenault, and Airbnb Vice President of Luxury Jonathan Poulin.

Overview

Airbnb has long been one of the most anticipated IPO candidates. It’s one of the biggest success stories to come out from Silicon Valley, tracing back to its founding as a website for booking spare accommodation in the middle of a recession in 2008. 

Originally known as AirBed & Breakfast, the company evolved from a website offering short-term living quarters and breakfast for guests seeking alternatives to hotels to now a major rental marketplace globally with over 2.9 million hosts.

Airbnb was notably incubated by Y Combinator, the famed startup accelerator that’s churned out many big success stories. The startup accelerator scored its first IPO exit when Dropbox went public in 2018 and is now set to score two more being Airbnb and the food delivery company DoorDash.

Given recent reports, Airbnb is likely hold its public offering before the end of this year.

Photo: Airbnb co-founder Nathan Blecharczyk by World Economic Forum is licensed under CC BY-NC-SA 2.0

Share this...

Facebook

Pinterest

Twitter

Linkedin

Whatsapp

Email

Print