WILL AIRBNB GO PUBLIC
Posted on 08/17/2016
Airbnb is poised to become the world’s fourth-largest online-travel intermediary by the end of this year, as its popularity continues to grow amongst leisure travellers and it develops a growing demand from the business sector.
Research firm Phocuswright, estimates that Airbnb, which doesn’t disclose bookings or revenue figures, likely generated about US $7.5 billion in gross bookings in 2015, and will probably surpass the annual bookings of European OTA eDreams Odigeo this year.
eDreams Odigeo’s five brands, which include Opodo, Travelink and Go Voyages, generated €10.7 ($15.5) billion in bookings for the year ended March 31.
In 2017 Phocuswright expects that Airbnb will trail only Expedia Inc., Priceline Group and China-based Ctrip in annual gross bookings. Expedia and Priceline generated US$61 billion and $56 billion, respectively, in gross bookings last year.
The Airbnb concept has proved immensely popular. Almost one in three US travellers stayed at a home-based unit last year, up from about one in 10 in 2011, according to Phocuswright.
Airbnb’s growth disproves the claim within the hotel industry that recent consolidation amid OTAs has given Expedia and Priceline too much sway over accommodations pricing and distribution, wrote Doug Quinby, Phocuswright vice president of research.
Hotel industry lobbyists last year criticized Expedia’s acquisition of Orbitz Worldwide because it gave Expedia and Priceline control over about 90 per cent of the OTA market in the US.
“Three guys without a lick of travel industry experience got together and have managed to create the fourth-largest online travel intermediary, just as OTA consolidation accelerated,” wrote Quinby.
“So who says you can’t build an online travel company today?”
Bloomberg News reported earlier this month that Airbnb has filed documentation indicating that it was raising US $850 million in a funding round that would value the 9-year-old company at about $30 billion, Airbnb refused to comment on any funding efforts.
Priceline’s market value is about $69 billion, while Expedia’s is about $17 billion.
Airbnb earlier this year also reportedly received a $1 billion credit line from a group of lenders that included Bank of America, Citigroup and JPMorgan Chase and Morgan Stanley.
Some analysts have said the debt indicates that the company may be preparing to go public.