Why trade Airbnb’s IPO with Capital.com?

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How to trade Airbnb’s IPO

As soon as Airbnb has listed its shares through an initial public offering, Airbnb stocks will become available for trading with Capital.com. You can trade Airbnb shares through contracts for difference (CFD) and speculate on Airbnb’s value without the need to own the asset itself.

After a series of lacklustre IPOs (think Uber or Lyft), it’s hard to feel confident about Airbnb’s valuation – not to mention its share price fluctuations post-IPO. By choosing CFDs, you can profit from ANY movement in Airbnb’s stock price: you can either hold a long position (speculating that the price will rise) or a short position (speculating that the price will fall).

Another advantage of trading Airbnb’s IPO with CFDs is leverage. Trading with leverage means that you can open significantly larger positions with a smaller amount of initial capital. However, while leverage provides the opportunity for big profits, it can also result in bigger losses.

Airbnb IPO date:
When will Airbnb go public?

Despite all the media hype about Airbnb going public this year, we still don’t have an exact IPO date. Recently the company has said that it might wait until 2020, although in April, Airbnb’s co-founder Nathan Blecharczyk confirmed that the company is taking steps to be ready to go public this year.

The market is already oversaturated with giant IPOs, and maybe it’s a smart decision that Airbnb has decided to wait until the end of the year. The ‘no rush’ approach might be also caused by the company’s strong financial position and the fact that it doesn’t need an immediate cash injection to stay afloat.

What is Airbnb's valuation?

Airbnb hasn’t officially filed papers for an IPO yet. According to the most recent internal estimates, Airbnb is likely to be valued at $38 billion, which supersedes the previous valuation of $31 billion.

For now, if this valuation remains unchanged and when the Airbnb listing is confirmed, the company will enjoy one of the world’s largest market caps within the online travel and accommodation industry. Just for quick reference: Booking.com takes the lead with $80 billion, followed by Expedia and TripAdvisor having $18 and $7.4 billion respectively.

Why is Airbnb going public?

Good question! The majority of companies go public with the aim of raising capital. With Airbnb it seems that it needs neither the immediate funds nor the reputation boost, so why is it thinking about an IPO?

Airbnb profits are stable. Even though it is a private company, and we don't have exact financial metrics, TechCrunch reports that the company earned more than $1 billion in revenue in Q3 2018. Furthermore, Wall Street analysts predict that Airbnb's revenue will continue its steady growth from $3.8 billion in 2018 to $8.5 billion in 2022.

Commenting about the Airbnb’s IPO plans, Mr. Blecharczyk added: "We have not decided if we will go public in 2019, and our focus is on building a 21st-century company, and we're all committed to that goal".

What is Airbnb?

Founded in 2008, Airbnb is the world’s most popular travel accommodation marketplace, empowering millions of people all over the world to monetise and unlock their homes, allowing them to become hospitality entrepreneurs in the process. The company’s people-to-people platform delivers benefits to all its members, including guests, hosts, communities and employees.

Airbnb Fast Facts

6M+ Airbnb listings worldwide
100K Cities with Airbnb listings
191+ Countries with Airbnb listings
500M Airbnb guest arrivals
2M+ People staying on Airbnb per night

What is Airbnb’s business model?

In order to stay competitive in the hotel industry, the company is currently working on diversification of its offering and including some complimentary travel services.

According to Brian Chesky, the company’s CEO, Airbnb platform is opening a studio for streaming and creating original travel content. A small part of its business is dedicated to restaurant and experience bookings. The ‘Experiences’ segment offers travellers over 25,000 local activities to choose from.

By 2022, new company’s activities, including experiences, transportation and other segments will take up a significant portion of its business. Still, Airbnb’s major revenue comes from helping travelers to book privately owned apartments online. The key drivers of Airbnb’s market success include competitive pricing, an extensive global presence and advanced user experience.

Who owns Airbnb?

The company doesn’t have one single owner. Most of the Airbnb stock belongs to the company’s founders, Nathan Blecharczyk, Joe Gebbia and Brian Chesky, who launched the business in 2008.

Besides, the company has many private investors, including Sequoia Capital, CapitalG, TCV, FirstMark and Manhattan Venture Partners among others. All in all, Airbnb has 53 investors, who gave $4.4 billion in funding.

What is an IPO?

An initial public offering is the process by which a company lists its shares for public trading. The company decides how many shares it is going to offer, and an investment bank typically estimates the initial price of the stocks based on supply and demand. After the company’s shares are listed on the stock exchange under a particular ticker symbol, these shares can be publicly traded.