Investment has been completed on Jun 6, 2021
- Net profit
Our team invested in Airbnb for the first time in 2017. It was one of the first private companies in our portfolio, and we watched Airbnb's turbulent transition to the public market with our investors. Its IPO was postponed several times, the company survived the pandemic with travel restrictions, the stock tumbled and then rebounded. In June 2021, the investment was successfully closed with +105% result.
Airbnb took tourism to a whole new level. If you choose to stay at an Airbnb accommodation, you get a chance of living in a local host’s house and gaining authentic experience and insight.
The company’s history dates back to 2007, a major design conference in San Francisco. Then roommates Joe Gebbia and Brian Chesky bought three air mattresses and decided to rent them in a loft.
Today Airbnb is the most popular online rental peer-to-peer lodging and experiences service around the world. Here you can rent a room or a luxury villa for a night or several months directly from hosts (more than 4M). The service charges fees on the amount booked: 3% to the host and 0% to 20% to the guest.
Airbnb is bigger than the world’s top five hotel brands put together. Its hosts have welcomed over 825M guests in more than 220 countries around the world and have earned over $110B.
Airbnb has huge potential in the growing travel and experiences market. The company estimates its total addressable market at $3.4T, including $1.8T for short-term stays, $210B for long-term stays, and $1.4T for experiences. The platform is changing consumer preferences in favor of unique accommodations and experiences, gradually capturing market share from Booking.com and hotel chains.
Now Airbnb is a leader in the short-term rentals market. The company is massively absorbing startups to secure growth points in new countries and segments. In 2017, Airbnb acquired a Canadian company Luxury Retreats. It is now Airbnb Luxe, a high-end vacation rental, where you can rent a luxury villa or house by the sea. Airbnb for Work, a search tool for business travels, is no less popular. Airbnb estimates that 500,000 companies are using Airbnb for Work to help manage their business travel.
In early 2020, when travel was suspended due to the COVID-19 pandemic, Airbnb's business took a hard hit. The company paid out $250M to support hosts impacted by cancellations. But within two months, its business model started to rebound even with limited international travel, demonstrating its resilience.
People wanted to get out of their homes and yearned to travel, but they did not want to go far or to be in crowded hotel lobbies. Stays of longer than a few days started increasing as work-from-home became work-from-any-home on Airbnb. Its platform now offers Experiences and Online Experiences: you can choose from an extensive catalog of virtual entertainment, including cooking Mexican tacos with a pro chef, meditation with a Buddhist monk, and a Harry Potter tour.
We bought Airbnb stock at $63.3 in September 2017. In December 2020, Airbnb had a successful IPO, and in June the lock-up period for this investment expired. Airbnb's shares closed at $151.32, with the result of +105%.