Oof! Airbnb valued at $100bn as IPO share price doubles in Nasdaq trading frenzy

Shares in Airbnb more than doubled in price to start trading at $146 on Thursday as the home-rental platform’s blockbuster stock market flotation drew strong interest from UK retail investors.

Co- founder and CEO Brian Chesky was momentarily rendered speechless as he was presented with news of the 120% surge on the final $68-a-share valuation. 

He told Bloomberg TV: “Oof. That’s the first time I’ve heard that number.. that’s, um.. I don’t know what else to say.. I’m humbled by it.”

The early trading frenzy saw prices hit $163 before easing back to settle at around $150, marking the biggest opening surge of the year. It put the company’s valuation at around $100billion - making it the biggest online travel company in the world. Market leader Booking.com is valued at $86 billion.

Airbnb is now also among the most valuable tech listings in history and one of the three biggest IPOs of 2020.

Investor interest, already sky-high, was further stoked by the bumper IPO debut of Deliveroo rival DoorDash, which saw its shares rocket 85% on launch 24 hours earlier.

Airbnb started off in 2008 as an idea from its founders puzzling over the shortage of hotel rooms in their home city of San Francisco. It now employs around 5,600 staff and last year had more than 2 million people staying at host homes in more than 220 cities every night.

The start-up was battered by travel restrictions and overnight stay bans early in the pandemic which saw revenue slide by $1.2bn and losses more than doubled to $697m. Today’s price is an eye-watering leap from a valuation of $18billion in April. 

Bulls on Airbnb, however, praise its unique business model of sharing properties between owner and renter. Unlike Booking, it has no major rivals and thus a hugely dominant brand position.

UK retail investors have expressed a lot of interest in the float, according to Hargreaves Lansdown.

The platform’s head of external relations said it was the fourth most viewed stock by its clients today: “It’s a great example of how a company worth billions can grow from a simple idea.”

Many of HL’s clients have reaped huge returns from investing in US tech giants this year and are hoping for more gains from the market newcomer.

However, some fund managers fear tech companies are now fully valued and will now plateau.