Airbnb is now the latest in a long line of disruptive startup companies that have gone to become multi-billion dollar enterprises and now are wishing to go public.
The firm noted its desire for an Initial Public Offering (IPO) earlier this week, having confidentially signalled its intent to do so with the United States Securities and Exchange Commission.
“Today, Airbnb confidentially submitted a draft Registration Statement on Form S-1 to the Securities and Exchange Commission (the ‘SEC’) relating to the proposed initial public offering of its common stock,” explained a recent press release from the company.
“The number of shares to be offered and the price range for the proposed offering have not yet been determined. The initial public offering is expected to take place after the SEC completes its review process, subject to market and other conditions,” it adds.
As The New York Times has noted, an IPO could prove difficult to pull off, especially as Airbnb will need to convince investors to purchase stock in a company which is built around home rentals.
Like many firms, Airbnb has suffered as a result of the COVID-19 pandemic, as well as people being under lockdown or told to work from home. Added to this was the company providing revised projections for its earnings in 2020, which now are half of the initial $4.8 billion before the coronavirus upended everything.
That said, prior to the pandemic, Airbnb was privately valued at $31 billion, which means there is still considerable value to be had in the post-COVID-19 era, whenever that happens.
While a precise date for the IPO has not been mentioned yet, another interesting element to all this is what will be uncovered as the company prepares to go public. The most infamous case to date is WeWork, which suffered heavily after stating its intention of an IPO, as more information regarding its inner workings were found.
Hopefully the same thing does not happen here, as Airbnb can ill afford it given the struggles that COVID-19 has already added.