Should Airbnb Be More Cautious Now?

One of the world’s leading tech unicorn, Airbnb, has done it again. After last year’s massive fundraiser of $1.5 Bn, Airbnb is planning to raise another $850 Mn.

Jet-Set To The Top

The San Francisco-based startup raised $1.5 Bn last year, which was one of the largest VC rounds in the history. Now with the announcement of raising $850 Mn more, it will reach a valuation of $30. This will make Airbnb the fourth most valuable tech unicorn in the world.

But Cannot Afford to Throw Caution to the Wind

Raising funds at this late stage is okay but Airbnb must not throw caution to the wind. It has been delaying its IPO just in the bid to keep the company private. But it has to be careful about its capital aggregation. It’s a double-sided sword as too much or too less equity will put investors in danger if the company’s valuations were to drop suddenly.

Keeping It A Private Affair

The investors of the company are engaged in a buyback program right now; they are buying back around $200 Mn worth of stocks from its employees.  It is a common practice among such late-stage companies who are still trying to remain listed as private limited. With this buyback, the employees are being offered liquidity options.

Although Airbnb is a current darling of VC investors and seems to be doing great, Brian Chesky (CEO) and his team need to take into account the dynamic market conditions and at the same time, protect its investors from any sudden fluctuations. How high will it soar from here on? We guess only time will tell.

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