Airbnb is now worth over $100bn as share price soars

Airbnb raised $3.5 billion from an initial public offering (IPO) that widely exceeded heightened expectations and made it the largest IPO of the year.

The vacation rental online marketplace tripled its IPO price of $68 to reach $149 on its first trading day, valuing the company at around $100 million. This is a huge leap from its valuation high of $31 billion in a 2017 financing round. At its current trading valuation, Airbnb is worth more than Uber, and more than Marriott and Hilton combined.

This valuation is rather different from the position of the company some months ago where it said it was laying off nearly 2,000 employees, or about 25% of its workforce, due to the impact of the coronavirus on its business.

Airbnb had already raised $2 billion in funding to try to provide additional cash during the current economic slowdown due to the epidemic but this was not enough hence the laying off of staff.

Related story: Airbnb bans house parties worldwide

However CEO Brian Chesky said in an interview with CNN’s Poppy Harlow, there are “two explanations” for the company’s stronger position today: one is that “people still do yearn to travel,” and the other stems from advice from his father.”I’m also reminded of something that my dad used to tell me growing up — and I had to tell myself this a lot during the depths of our dark days. He said that things are never quite as good as they seem and as bad as they seem. You kind of have to remind yourself of that to find the midpoint between these highs and lows,” said Chesky.

With the success of the IPO and subsequent trading, the three co-founders Brian chesky, Joe Gebbia and Nathan Blecharczyk have now increased their net-worth. Mr Chesky who holds about 11% of the company’s stock, is now worth $11.4 billion while Nathan Blecharcyzk (chief strategy officer) and Joe Gebbia (chief product officer) who each own just under 10%, are worth $10.3 billion each

All three sold 517,241 shares in the IPO, generating an estimated $22 million in cash after taxes each.

Other notable investors in Airbnb include hedge fund Sequoia Capital, which will own 16.5% of the company after the IPO