Airbnb has recently decided to go public. Their most recent private valuation for the company was $18 billion, after it raised $2 billion in debt at the beginning of the year. With that being said, how does Airbnb plan on valuing their company in its Initial Public Offering?
The vacation rental online marketplace company plans to price at $44 to $50 per share in its IPO, which gives it a valuation of up to $35 billion on a fully diluted basis. According to a new filing submitted to the Securities and Exchange Commission, Airbnb is looking to raise about $2.5 billion, while existing investors are looking to sell off $96 million worth of stock.
Comparably, the company’s valuation back in 2017 was sitting at $31 billion. Since the company took a big hit in the early months of 2020, their private valuation was adjusted due to these issues. Interestingly, at the suggested share price they are seeking in their IPO, the company has the potential of being worth more than they ever have.
Back in May, the company was forced to reduce their staff by about 25% but incurred a strong recovery later in the year with a surge in rentals in rural areas to get away from big cities and the coronavirus.
Will you be looking to score some Airbnb shares?
I am not a financial advisor and my comments should never be taken as financial advice. Investments come with risk, so always do your research and analysis beforehand.