Technology

Wednesday 20 August 2014

Airbnb in funding talks valuing it at about $10bn

Published 21/03/2014 | 08:15

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Chip Conley, Head of Global Hospitality, Airbnb.
Chip Conley, Head of Global Hospitality, Airbnb.

Online home-rental marketplace Airbnb is in advanced talks with private equity firms including TPG Capital Management LP to raise funds that would value the company at about $10bn, it is understood.

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TPG is likely to lead the funding round, which could exceed $400m.

Texas-based TPG recently made a large investment in ride-sharing company Uber, another major player in the burgeoning sector known as the sharing economy.

Airbnb, whose website rental listings range from private rooms to manors and islands, has become one of Silicon Valley's most successful start-ups in the five years since it was founded by a trio of graduates from the Rhode Island School of Design and Harvard.

But its foray into the hospitality business has been met with controversy in critical markets like New York state, which prohibits renters from subletting their homes for less than 30 days if they are not present. The company remains locked in a legal battle with New York Attorney General Eric Schneiderman, who subpoenaed Airbnb for information about its hosts in the state last year to determine which were in violation of state law.

The San Francisco city attorney's office has also looked into the legality of such short-term rentals after coming under pressure from tenant advocates, who say the proliferation of Airbnb rentals has sapped the rental housing market of supply and driven up rent prices.

A valuation of $10bn would make Airbnb worth more than Hyatt Hotels Corp, which has a market value of $8.43bn, and Wyndham Worldwide Corp, valued at $9.39bn.

 

Reuters

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