Upcoming IPOs:
Airbnb

During The New York Times Dealbook Conference Brian Chesky, Airbnb’s CEO, stated the intent of his company to go public in 2020. This news comes at the tail of intriguing financials posted by The Information recently. According to their sources, Airbnb’s losses rose by 58%, mostly due to increases in Marketing spend, in the first quarter of 2019.

Here’s what we know

Below is the allegedly quarterly performance of Airbnb as reported by The Information. The aggregation at this level shows an acceleration of Sales & Marketing spend causing the hike in operational losses for the period. Overall, Total Costs & Expenses grew by 46% in the Year on Year quarterly analysis.

As the article acutely explains: “Airbnb boosted investment into sales and marketing to $367 million in the first three months of this year, a 58% increase from the same period last year, according to figures viewed by The Information. The spending increase was bigger than for any other category, such as product development, which grew by 51%. Operations and support, which includes customer service, climbed 30%.”

Airbnb IPO prospects rely on an excellent gross profit margin

During his conversation at The New York Times Dealbook Conference Chesky spoke to the “continuum” of tech companies. That’s an important differentiation. Airbnb mimics the operationally lean approach of a pure software/tech company, as opposed to so-called tech-enabled companies which may have to incur in higher capital expenditures and higher marginal costs of acquiring and servicing new customers.

Especially noteworthy is Chesk’y assessment of gross profit margins. As noted by Business Insider and The Information’s article, Airbnb is in very good company in that aspect with a rosy 67% gross margin similar to that of Microsoft (69%) with also a very “capital-light” business and low marginal costs. All those performance indicators position Airbnb as a highly anticipated candidate for a 2020 direct listing, since according to Chesky, Airbnb “doesn’t not need to raise new money” and has more cash in the bank than it has raised to date (over $3.2B with the latest round valuing the company at $31B according to The New York Times.

An Olympic signal

Airbnb has reportedly secured a $500M sponsorship agreement with the IOC, the organizer of the Olympic games, according to Forbes and the Financial Times. The agreement will make Airbnb a Worldwide Olympic Partner for the events happening in the next nine years: Tokyo 2020, Beijing 2022, Paris 2024, Milan 2026, Los Angeles 2028.

This is yet another unequivocal signal that Airbnb is likely to announce more details around their IPO very soon. This sponsorship will increase the visibility of the brand and it could indicate the proximity of the two main events: Airbnb’s IPO and the start of the 2020 Tokyo Olympic Games which start July 24, 2020, and end August 9, 2020.

Seize the opportunity

If you are considering investing in the peer-to-peer lodging giant, Invertidos has secured access to their equity in the secondary market. Please contact us here to learn more about how you can capitalize on this low risk, high return operation.

Upcoming IPOs – Airbnb

During The New York Times Dealbook Conference Brian Chesky, Airbnb’s CEO, stated the intent of his company to go public in 2020. This news comes at the tail of intriguing financials posted by The Information recently. According to their sources, Airbnb’s losses rose by 58%, mostly due to increases in Marketing spend, in the first quarter of 2019.

Here’s what we know

Below is the allegedly quarterly performance of Airbnb as reported by The Information. The aggregation at this level shows an acceleration of Sales & Marketing spend causing the hike in operational losses for the period. Overall, Total Costs & Expenses grew by 46% in the Year on Year quarterly analysis.

As the article acutely explains: “Airbnb boosted investment into sales and marketing to $367 million in the first three months of this year, a 58% increase from the same period last year, according to figures viewed by The Information. The spending increase was bigger than for any other category, such as product development, which grew by 51%. Operations and support, which includes customer service, climbed 30%.”

Airbnb IPO prospects rely on an excellent gross profit margin

During his conversation at The New York Times Dealbook Conference Chesky spoke to the “continuum” of tech companies. That’s an important differentiation. Airbnb mimics the operationally lean approach of a pure software/tech company, as opposed to so-called tech-enabled companies which may have to incur in higher capital expenditures and higher marginal costs of acquiring and servicing new customers.

Especially noteworthy is Chesk’y assessment of gross profit margins. As noted by Business Insider and The Information’s article, Airbnb is in very good company in that aspect with a rosy 67% gross margin similar to that of Microsoft (69%) with also a very “capital-light” business and low marginal costs. All those performance indicators position Airbnb as a highly anticipated candidate for a 2020 direct listing, since according to Chesky, Airbnb “doesn’t not need to raise new money” and has more cash in the bank than it has raised to date (over $3.2B with the latest round valuing the company at $31B according to The New York Times.

An Olympic signal

Airbnb has reportedly secured a $500M sponsorship agreement with the IOC, the organizer of the Olympic games, according to Forbes and the Financial Times. The agreement will make Airbnb a Worldwide Olympic Partner for the events happening in the next nine years: Tokyo 2020, Beijing 2022, Paris 2024, Milan 2026, Los Angeles 2028.

This is yet another unequivocal signal that Airbnb is likely to announce more details around their IPO very soon. This sponsorship will increase the visibility of the brand and it could indicate the proximity of the two main events: Airbnb’s IPO and the start of the 2020 Tokyo Olympic Games which start July 24, 2020, and end August 9, 2020.

Seize the opportunity

If you are considering investing in the peer-to-peer lodging giant, Invertidos has secured access to their equity in the secondary market. Please contact us here to learn more about how you can capitalize on this low risk, high return operation before it goes public.