Airbnb and Other Unicorns Suffer by Staying Private, High-Profile Tech Investor Argues
Skift Take
Would Airbnb and Uber, for example, be truly better off as public companies? It's unclear because they both have access to tons of money already. But they would both certainly be better equipped to spin their own narratives.
As Airbnb mulls executing an initial public offering next year, tech investor Bill Gurley argued that Airbnb and other unicorns suffer by remaining privately held.
"Once you get to a certain size, you can't be a thorn in Expedia and Priceline's ass, and not expect them to turn around and talk and come after you," said Gurley, a general partner a Benchmark Capital, referring to the battle between Airbnb and Booking Holdings over which company has the most alternative accommodations listings and consumer demand.
Over the years, Benchmark has invested in Twitter, Uber, Snapchat, Instagram, OpenTable, Zillow, Glassdoor and many others, although it has not been an investor in Airbnb or any of the online travel agencies.
When companies stay private or transition from a publicly held company back to the private sector, executives often say that there are great advantages to building and running companies outside the glare of quarterly earnings calls.
But in a one-on-one interview with Skift while attending the Phocuswright conference in Los Angeles Wednesday, Gurley argued that Airbnb and its co-founder and CEO Brian Chesky are suffering because the company is privately held.
"All these entrepreneurs love to tell you how wonderful it is to be private and that they have advantages," Gurley said. "Chesky's getting hurt right now because he's private. And Morgan Stanley's brought this report out and said we think the world is like this. And (Booking Holdings CEO Glenn) Fogel has the microphone because he's in public and he can probably state it, and you're sitting over there private not sharing anything and you're taking the brunt of these blows."
Private companies lose out in controlling their own narrative, Gurley said. "So this is one of those things where these companies think that they can just hide forever. And no, the war of words is coming at you. And if you choose to be quiet, it's going to be told by other people."
Gurley was speaking before becoming aware that Airbnb responded to the Morgan Stanley report that showed that Airbnb's growth was s
