Sleeping in other people’s beds has turned out to be a goldmine for rental startup Airbnb. The controversial Silicon Valley company has raised another half a billion dollars from investors at a price that values the company at $30bn.
The company is expected to file a notice with the securities and exchange commission (SEC) on Thursday, according to Fortune, which first reported the news.
At $30bn, Airbnb is worth more than Hilton Hotels.
The company signed off on a $1bn debt deal to fund new services in June. Executives have told investors the firm will be profitable in 2016, though it operated at a loss of about $150m last year.
Airbnb’s business model depends on local authorities allowing it to operate outside of the laws that control hotels. The strategy is a controversial one: in New York City and San Francisco it is embroiled in legal disputes with municipal governments. The latter voted to fine the company $1,000 a day for every unregistered host.
But the service is popular with users and often undersells hotels or has rooms available during events and conferences where bulk sales have filled all the conventional hotels. The hotel industry, upset with the interruption to its regular course of business, has asked Washington to intervene.
A source told Fortune that the company’s cash on hand was plentiful, but that it viewed the new money was “insurance” against future endeavors. With $1.55bn in the bank, its insurance policy would seem large enough to support a serious expansion or a major legal pushback.
Early-round investors are poised to benefit greatly from the company’s size increase; Sequoia Capital and Ycombinator were the company’s “seed round” investors. More recently, Airbnb’s success has attracted financial institutions, notably JP Morgan Chase. Peter Thiel’s Founders Fund is also an investor.
This article was written by Sam Thielman in New York, for theguardian.com on Thursday 22nd September 2016 23.17 Europe/Londonguardian.co.uk © Guardian News and Media Limited 2010
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