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AirBnB: A Pre-IPO Juggernaut

Among our many offerings at Iron Edge VC, one of the more recognizable names is AirBnB. The company’s basic business model, that which enables homeowners to earn income as small-scale hoteliers, is well-known across an enormous worldwide demographic. But the company, founded in 2007, has expanded in less widely understood ways as its valuation has soared steadily to approximately $31 billion. Aside from private residences, AirBnB provides leasing services for commercial properties. They have also established AirBnB Lux, taking their residential model to a higher level by curating and offering rentals of very high-end homes (think penthouses instead of apartments, or mansions instead of houses). With AirBnB Select, the company sets apart the properties owned by “superhosts” — homeowners who have earned exceptionally good reviews and high response rates by providing hotel-standard amenities.

Perhaps most exciting among AirBnB’s expanded product line is “AirBnB Experiences”. Launched in 2016, AirBnB Experiences gives an added level of service wherein the company integrates with restaurants, entertainment venues, sports stadiums, and other such vendors across the globe in order to make available a wide array of memorable activities. These opportunities range from surfing to mountain climbing to social impact experiences and way beyond. According to AirBnB CEO Brian Chesky, the “experience economy” is growing and will soon become “massive”. He adds that the AirBnB Experiences product is growing at a rate ten times faster than the AirBnB Homes product. Read that last sentence again… this is particularly noteworthy because the Experiences product is like a whole new (and enormously successful) company within an already familiar name!

Clearly, AirBnB is comprehensively reinventing the hospitality industry by creating a single source that satisfies all travel needs from the simplest to the most elaborate. AirBnB has been through eleven rounds of financing with the world’s most successful and respected venture capital outfits since 2009. The most recent round was in December, 2016. That there has been no need for more financing in over eighteen months suggests that the company is in excellent fiscal health.

In a May 30, 2018 interview at Recode’s Code Conference, Chesky stated that AirBnB will be “ready to IPO” in 2019, but the final decision to do so will depend on an IPO’s benefit to the company and to investors. He then shared that he has had many conversations with others who have had good experiences with the process, including Facebook CEO Mark Zuckerberg, who is a “big proponent” of going public.

At Iron Edge VC, we are more than proud to have AirBnB as one of the companies available to our members. If you’re interested in this opportunity, please let us know. Shares are available on a first-come, first-served basis.

All Our Best,

Paul Maguire, Managing Partner, and The Iron Edge Team

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Paul Maguire

Founder And Managing Partner