IPO Report: Airbnb IPO raises at least $3.5 billion, challenging DoorDash and Snowflake for largest IPO of the year

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Airbnb Inc. pulled off one of the largest initial public offerings of 2020 despite a pandemic that laid waste to much of the travel industry.

The lodging-booking platform priced its initial public offering at $68 a share Wednesday, the Wall Street Journal reported, well above its most recent target range of $56 to $60, which it had already revised upward. At its IPO price, Airbnb ABNB, is expected to raise at least $3.5 billion with an initial market capitalization topping $40 billion.

That would top Airbnb’s opening act on the 2020 IPO train, DoorDash Inc. DASH, +85.79%, which began trading Wednesday morning, and Snowflake Inc., both of which raised $3.36 billion before overallotments and private placements, according to PWC data. The only offering this year to top Airbnb was of a different sort: Bill Ackman’s $4 billion special-purpose acquisition company, or SPAC.

Airbnb shares are expected to make their debut Thursday on the Nasdaq Global Select Market, trading under the symbol “ABNB.”

The San Francisco company had planned to go public in the spring but was stunned by the COVID-19 pandemic and the subsequent travel restrictions that followed. It has since seen a rebound in its business, which allows people to rent out their homes or apartments online. Airbnb’s third-quarter revenue bounced back to $1.34 billion from $334.8 million in the second quarter. The company attributed its comeback to the strength of domestic travel, short trips and long-term stays as restrictions loosened.

But travel, and therefore Airbnb’s business, may be affected in the short term as coronavirus cases rise again, a perfect example of a risk factor the company listed in its prospectus: that the COVID-19 pandemic “will continue to materially adversely impact our business, results of operations, and financial condition.”

See: 5 things to know about Airbnb as it goes public

Airbnb was founded in 2008 after its co-founders rented out room in their San Francisco apartment the previous year to help pay their rent, and the company has raised $6.5 billion from investors including Sequoia Capital, Founders Fund and DST Global. The IPO will be led by Morgan Stanley and Goldman Sachs, along with more than 30 other underwriters, and they will have access to an additional 5 million shares that could drive the total raised higher, as eventually happened with Snowflake. 

Airbnb’s public offering will come the day after the big stock-market entrance of DoorDash, which saw a first-day pop of 85% Wednesday. Other tech companies that IPO’d during this roller-coaster of a year for the stock markets and beyond include Asana Inc.  ASAN, -2.34%  and Palantir Technologies Inc.  PLTR, -6.86%. Roblox  RBLX, , Affirm AFRM, and Wish  WISH, are also expected to go public by the end of the year.