Short-term rental site Airbnb has lowered its internal valuation to $26 billion, a 16 percent drop, as business continue to be hammered by lockdowns, Reuters reported, citing sources familiar with the matter.
At its most recent funding round of $1 billion in September 2017, Airbnb had a valuation of $31 billion, the source said. Chief executive officer Brian Chesky reportedly held a staff meeting on Thursday (April 12) to inform people of the news, the source said.
A source told Reuters last week that Airbnb was in talks with lenders about getting an extension of its $1 billion debt facility.
The company was also in talks with investors to consider a late-stage funding round, the Financial Times reported.
Bookings were off up to 90 percent in particularly hard-hit regions, data from independent monitoring firm AirDNA indicated.
Chesky also made a point of telling staff that other travel booking services were suffering from a downturn due to the coronavirus. The market capitalization of Expedia was down 58 percent, Hilton, 44 percent and Booking.com 37 percent.
Internal forecasts anticipate the company will get back up to its 2019 revenue levels by January 2021. In 2019, Airbnb posted $4.8 billion in revenue, up 35 percent year-on-year, the source said.
As a way to solidify the platform for reopening properties after the pandemic, Airbnb said on Monday (March 30) that it was putting aside $250 million to help hosts forced to give full refunds due to COVID-19 cancellations.
The Silicon Valley startup unicorn was founded in 2008 by Brian Chesky, Joe Gebbia and Nathan Blecharczyk. The company indicates that it has 4,500,000 listings in over 65,000 cities in 191 countries. Airbnb has raised $4.4 billion in 15 founding rounds.
Airbnb hosts looking for alternatives to their usual operations while the coronavirus stalls the economy have begun listing their properties on other rival sites like Willow and Trulio, a move that could spell trouble for Airbnb.
The pandemic and other setbacks this year could delay its initial public offering (IPO) until 2021.