Finally, Airbnb IPO Will Signal a New Era of Accounting and Accountability

If market conditions line up and Airbnb indeed goes public, I’m certainly not alone in salivating about the prospects.

No, I’m not talking about from an investor standpoint. I’m skeptical about chatter predicting that Airbnb is set for a blockbuster IPO when none of the financials or pricing have yet to be officially revealed. After all, a blockbuster debut, even if it were to happen, could head south in a Nasdaq minute.

But Airbnb trading on the stock exchange would usher in a new era not only for the dozen-year-old lodging company, but also for the online travel industry as a whole.

For example, when I reported a year ago that Airbnb Beat Expedia in Booked Room Nights, and that the transition was unpublicized but still a watershed event, the only reason we knew about the milestone was because the Wall Street Journal had obtained privately held Airbnb’s first quarter of 2019 financial results.

Assuming Airbnb indeed obtains its stock symbol, starts releasing quarterly results, and conducts earnings calls with analysts, Airbnb will have to disclose metrics such as gross bookings, revenue, and profits or losses on a GAAP basis.

I especially look forward to Airbnb having to be transparent about marketing spend, litigation, acquisitions, and impairment charges.

Can Airbnb really live up to its previous narratives about needing to spend less than its peers on marketing through Google because of the strength of the Airbnb brand? If Airbnb can indeed chart a pathway to liberation from Google, then that could provide momentum and learnings to competitors such as Expedia Group, which see reduced reliance on Google as an imperative.

Google Maneuverings

As The Information reported, Airbnb has ceased its Google advertising — for now, at least — as CEO Brian Chesky hopes to to tout a marketing advantage and generate publicity through product launch announcements, among other means. In random searches of Google’s vacation rental offering, it appears as though Airbnb has likewise dropped out as a participant even though it’s free for vendors  — and Booking Holdings has jumped back in after a prolonged absence.  Not that Google vacation rentals was a huge difference-maker for Airbnb, but its absence in the prouduct reflects the company’s overall Google intentions, and changing competitive dynamics.

A public-company Airbnb might spur companies like Booking Holdings to be more transparent in releasing additional metrics about their short-term rental business so investors could more accurately size up the two companies, and others, on a mangoes to mangoes basis. With both Airbnb and Vrbo reporting a surge in bookings, Booking Holdings may feel compelled to provide more such elucidations as it took the unusual step earlier this month of disclosing that 40 percent of new bookings in the second quarter were for alternative accommodations, and that was an increase.

A Distraction and No More Hiding

Being a pubic company will be a distraction for Airbnb, after years of being shielded as a private unicorn, and conducting earnings calls will be a challenge for Chesky, as it would be for any first-time public company CEO.

It would be interesting to see, when sparring with financial analysts about Airbnb’s earnings and forecasts, how Chesky would explain recent statements such as: “We didn’t start this company to get into the real estate industry,” given the bevy of quasi-hotels on the platform.

Or this utterance: “Our mission is not merely about travel. When we started Airbnb, our original tagline was, ‘Travel like a human.’ The human part was always more important than the travel part. What we are about is belonging, and at the center of belonging is love.”

The latter quote sounds too kumbaya for an earnings call. Very fluffy indeed.

Briefly

MakeMyTrip Wants Travel Agents to Leverage Digitalization

With Goldman Sachs forecasting increased online adoption among India’s travelers, MakeMyTrip is launching a travel agency portal, myPartner, to expand product distribution, and enable offline travel agents to get online. Tripadvisor recently did something similar, and Booking.com and Expedia have long offered their content through global distribution systems. Mass travel agent adoption is highly unlikely, though. ET Hospitality World

Despegar Gets Acquisitive With Discounts in Mind

Latin America’s Despegar went shopping in its two key target markets, Mexico and Brazil, and found some seeming bargains. Despegar negotiated a 58 percent discount off the initially agreed upon $136 million for the still-pending acquisition of Mexican travel agency Best Day, and bought Brazilian payment platform Koin likewise at what a Despegar official called a “significantly” reduced valuation. Skift

Omio Gets $100 Million in Financing to Navigate the Pandemic

Multimodal-booking company Omio, which itself is a byproduct of the GoEuro-Rome2Rio merger about nine months ago, secured about $100 million in convertible debt to get through the pandemic, and browse for acquisitions on the cheap. It’s hard to picture the terms of the investment being cheap for Omio, however. Skift

Domio Gets Booted From Airbnb

Short-term rental platform Domio, which operates or manages quasi hotels, saw its accounts and listings suspended from Airbnb for allegedly using fake host names, and other misleading practices. We’re betting this Airbnb suspension will be temporary, and Domio will get back in good standing. Skift

Vacation-Shaming During the Pandemic

In an era not too long ago, travelers could be carefree about sharing their vacation photos on social media. But first came a backlash against taking flights on gas-guzzling airplanes, and even more recently some vacationers are getting flack about traveling during the pandemic. On Scott’s Cheap Flights’ Facebook community pages, you have to pledge not to engage in bullying to get access. Sign of the times. USA Today