American vacation rental online marketplace Airbnb eyes $30 billion IPO valuation

GLOBAL – Airbnb, an American vacation rental online market place, is hoping to have a valuation of US$30 billion in the IPO slated in the latter part of 2020 where it aims to raise about US$3 billion, Nairametricshas reported.

The announcement follows a commitment by Airbnb to invest US$1 million through 2020 to promote and support community-led tourism projects in Africa.

The commitment aims to empower communities through home sharing and to promote people-to-people tourism that benefits local families and their communities.

A US$30 billion valuation would be substantially higher than the US$18 billion valuation that Airbnb was valued at in April when it raised $2 billion in debt from investors.

The valuation if successful would also be more that the company’s most recent independent appraisal of the fair market value of its stock which pegged its worth at around $21 billion.

According to a Reuters report, Airbnb plans to use the present leverage of its business, after it recently rebounded in revenues after the COVID-19 pandemic took its toll on the hospitality industry.

Through its online marketplace, Airbnb allows individuals to let out their apartments or spare rooms to intended guests, at prices often lower than hotels.

Airbnb makes a cut of 3% commission of every booking from those individuals listing their apartments on Airbnb’s platform, and between 6% and 12% from guests that book via its platform.

In Africa where it is increasingly expanding its presence, hosts using its platform are reported to have earned $400+ million dollars in 2019, with $260M in South Africa alone.

The ripple effect of the activity of the Airbnb community resulted in an economic impact of US$678 million, supporting over 22,000 jobs in the continent.

The company, is predicted to be one of the biggest U.S. stock market listings anticipated this year, amid an impressive number of IPOs, which include the likes of data analytics firm Palantir Warner Music Group, and data warehouse company Snowflake.

Sequel to the IPO valuation, the online home rental company disclosed in August, that it had filed confidentially for an IPO with U.S. authorities.

Airbnb present strategy is to make its filing publicly available next month, after the U.S presidential election, which is scheduled to hold November 3, and is targeting an IPO sometime around December.

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