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10 March 2017

Airbnb clears $1bn in series F round

The round, which reportedly included Alphabet's CapitalG unit, boosted Airbnb's overall equity funding to $3.4bn and values it at $31bn.

Author: Robert Lavine, News Editor

US-based short-term accommodation marketplace Airbnb has closed a $1bn series F round that, according to reports in September, included internet and technology conglomerate Alphabet, CNBC reported yesterday.

Airbnb has not disclosed the identity of the investors in the round, which numbered 40 according to a regulatory filing, but CNBC reported that it valued the company at $31bn.

A report in September stated that Alphabet subsidiary CapitalG, then known as Google Capital, was co-leading the round, which had then reached $555m out of a targeted $850m, with growth equity firm Technology Crossover Ventures.

Airbnb runs an online and mobile platform that enables users to lease out or rent properties over short periods, with the company taking a cut of the payment. It has since expanded into local tourism services under the Experiences banner as well as travel booking.

The company has also asked consulting firm McKinsey & Co to research the long-term rental market, the Sydney Morning Herald reported yesterday, citing two people familiar with the matter. A move into that section of the market would pit it against the likes of Craigslist and Gumtree.

A person close to Airbnb told CNBC the company entered profitability in Q2 2016 and expects to record positive full-year EBITDA (earnings before interest, tax, depreciation and amortisation) in 2017.

However, the company is still facing regulatory battles in several cities in addition to complaints from local residents that it is aiding gentrification in their areas. A study released by trade body the American Hotel & Lodging Association this week has claimed it makes a hefty part of its revenue from commercial renters.

However, the extra funding in the series F round increased Airbnb’s overall equity funding to $3.4bn since it was founded in 2008.

General Atlantic, Hillhouse Capital, Tiger Global Management, Temasek, Kleiner Perkins Caufield & Byers, GGV Capital, China Broadband Capital, Horizon Ventures, Wellington Management, Baillie Gifford, T. Rowe Price and Fidelity Investment all backing its last round, a $1.5bn series E in 2015.

TPG, Dragoneer Investment Group, DST Global, Founders Fund, Firstmark Capital, Sequoia Capital, CrunchFund, Andreessen Horowitz, General Catalyst Partners, Y Combinator and SV Angel are also past investors.

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