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Everything to know about Airbnb’s IPO

November 17, 2020, 3:24 PM UTC

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What a saga it has been for Airbnb.

The pandemic hit travel first and foremost, leading the home-sharing company to lay off nearly 2,000 of its employees. But from the brink, the company has returned for an IPO. 

Here’s the skinny of that IPO, likely to list sometime in December.

COVID-19 hit like a truck: Revenue in the first nine months of 2020 dropped like a stone, to $2.5 billion from $3.7 billion the same period a year earlier. While Airbnb’s sales and marketing costs fell dramatically, the company piled on restructuring and borrowing costs. Net losses ballooned to $696.9 million in the same period, up over double from the same period a year prior. The company’s enviable free-cash-flow metric also turned negative in the period to $520.1 million from a positive $319.8 million.

But the company has come back stronger than many expected: Airbnb has hit profitability once again. After three quarters of straight losses, Airbnb posted net income of $219.3 million in the third quarter of 2020 as marketing costs remained low but consumers began travelling again.

Domestic is its new game plan: “Our business historically has been weighted toward cross-border travel, which accounted for 49% of nights in 2019,” its S-1 reads. But an increase in domestic travel, particularly in the U.S. and Europe, has been responsible for Airbnb’s bounceback. About 77% of bookings in experiences and stays came from domestic travel in September. “Several areas of our business have shown resilience, notably domestic travel, short-distance travel, travel outside of our top 20 cities, and long-term stays,” the filing reads.

Although bookings aren’t at 100%: Airbnb has fared better than many other travel businesses, but the company is not back to pre-pandemic times. Bookings for its stays and experiences in September still remained 28% below the same period a year earlier, while the company has fallen behind every month compared to the same period a year earlier, since March.

And Airbnb still faces legal risks: As my colleague Danielle Abril notes, Airbnb’s risk section is a compendium. Airbnb faces threats of increased regulation from governments that argue the company’s listings are driving up rental prices. (On the flipside, I’ve also heard the argument that Airbnb offers a way to revive economies during the pandemic.)

We don’t know how experiences are doing: Not so long ago, Airbnb was touting its experiences business, a key part of CEO Brian Chesky’s goal to create an end-to-end travel business. Pre-pandemic, you could make pasta in Florence or tour the desert in Oman with locals. Now, Airbnb is still offering video lessons. But the IPO filing doesn’t break out the exact figures for experiences. Last we heard—back in 2018—the numbers were small: about $15 million in revenue.

By the way, Airbnb is offering stock to hosts: As with Uber and Lyft, Airbnb is offering shares to select hosts on its platforms, namely U.S.-based hosts who have been on the platform in 2019 or 2020 or as decided by Airbnb officers and directors.

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A TALE OF TWO PAYMENTS GIANTS: While Visa’s multi-billion dollar deal to acquire Plaid is at the center of a Department of Justice lawsuit, Mastercard has gotten the greenlight to acquire Finicity, a fintech platform compared to Plaid. Though the Mastercard deal also faced scrutiny from the DoJ, there were signs regulators were going in a different direction. In its lawsuit against Visa, the DoJ revealed that it thought Mastercard had been unable to make a notable mark in Visa’s pie: “For years, Mastercard has neither gained significant share from Visa nor restrained Visa’s monopoly…For example, Visa has long-term contracts with many of the nation’s largest banks that restrict these banks’ ability to issue Mastercard debit cards.”

Lucinda Shen
Twitter: @shenlucinda
Email: lucinda.shen@fortune.com

VENTURE DEALS

- DataRobot, a Boston-based enterprise A.I. platform, raised $270 million in funding. Altimeter Capital led the round and was joined by investors including T. Rowe Price, BlackRock, Silver Lake, NEA, and Tiger. The round values the company at over $2.7 billion.  

- Strava, a San Francisco-based maker of a running app and social platform for athletes, raised $110 million in Series F funding. TCV and Sequoia Capital led the round and were joined by Dragoneer Investment Group, Madrone Capital Partners, Jackson Square Ventures, and Go4it Capital.

- Paddle, a London-based billings, subscriptions and payments platform for enterprises, raised $68 million (£52 million) in Series C funding. FTV Capital led the round and was joined by investors including  Kindred Capital, Notion Capital, and 83 North. 

- AliveCor, a Mountain View, Calif.-based provider of enterprise cardiology solutions, raised $65 million in Series E funding. Investors included OMRON, Khosla Ventures, WP Global Partners, Qualcomm Ventures, and Bold Capital Partners

- Tibber, a Stockholm-based company seeking to make electricity cheaper and greener,  raised $65 million in Series B funding. Eight Roads Ventures and Balderton Capital led the round and was joined by investors including Founders Fund. 

- HOVER, a San Francisco-based provider of visualization tools for home improvement and property insurance professionals, raised $60 million in Series D funding. Investors included Travelers (NYSE: TRV), State Farm Ventures, and Nationwide.

- ActivTrak, an Austin-based workforce analytics software company, raised $50 million in Series B funding. Sapphire Ventures led the round.

- InterVenn Biosciences, a South San Francisco-based biotech with a diagnostic for ovarian cancer, raised $34 million in a Series B funding. Anzu Partners led the round and was joined by investors including Genoa Ventures, Amplify Partners, True Ventures, Xeraya Capital, and the Ojjeh Family.

- Chooch.ai, a San Francisco-based startup computer vision startup, raised $20 million in Series A funding. Vickers Venture Partners  led the round and was joined by investors including 212, Streamlined Ventures, Alumni Ventures Group, and Waterman Ventures. Read more.

- Ferroelectric Memory GmbH, a Germany-based maker of technologies for the semiconductor industry, raised $20 million in Series B funding. M Ventures and imec.xpand led the round and was joined by investors including SK hynix, Robert Bosch Venture Capital, and TEL Venture Capital. 

- Unbound Tech, a New York-based maker of cryptographic key management, raised $20 million in Series B funding. Evolution Equity Partners led the round and was joined by investors including Innovation Endeavors, Goldman Sachs, Citi and BlueRed Partners.

- Trust & Will, a San Diego-based estate planning site, raised $15 million. Jackson Square Ventures led the round and was joined by investors including Fifth Third Capital Holdings, Northwestern Mutual Future Ventures, AARP, Rosecliff Ventures, Hack VC, and Actium Partners.

- OpenPhone, a San Francisco-based business phone app, raised $14 million in Series A funding. David Sacks of Craft Ventures with participation from Slow Ventures, Kindred Ventures, Y Combinator, Garage Capital, and Chapter One Ventures.

- Gretel, a San Diego, Calif.-based maker of an API for anonymizing data, raised $12 million in Series A funding. Greylock led the round. Read more.

- Levels, a New York-based maker of a wearable that tracks blood sugar levels, raised $12 million in seed funding. A16z led the round and was joined by investors including Marc Randolph (co-founder of Netflix), Dick Costolo (former CEO of Twitter), Michael Arrington (Founder of TechCrunch), and Matt Dellavedova (NBA, Cleveland Cavaliers).

- Arrikto, a San Mateo, Calif.-based machine learning development startup, raised $10 million in Series A funding. Unusual Ventures led the round. Read more.

- Troy Medicare, a Charlotte, N.C.-based provider of a Medicare Advantage plan, raised $10 million in Series B funding. AXA Venture Partners led the round and was joined by investors including Sunwater Capital.

- Amicus.io, a Charlotte, N.C.-based fintech company with a philanthropic platform, raised $8.7 million in Series B funding. The FR Group led the round and was joined by investors including the Wells Fargo Startup Accelerator.

- Nymbl Science, a Denver-based provider of a fall prevention solution in the healthcare space, raised $4 million in Series A funding. Cobalt Ventures led the round.

- Terra Kaffe, a New York-based maker of an espresso machine, raised $4 million in seed funding. The Seed Lab led the round.

- SeeTree, a Tel Aviv, Israel-based maker of a way to track trees for farmers, raised $3 million from Orbia Ventures

- Garden, a Berlin-based open-sourced development automation platform for Kubernetes and cloud native applications, raised 3.1 million ($3.7 million) in seed funding. Crowberry Capital led the round and was joined by investors including byFounders

- Undock, a maker of a chrome extension for scheduling, raised $1.6 million in seed funding. Investors include Lightship Capital, Bessemer Venture Partners, Lerer Hippeau, Alumni Ventures Group, Active Capital, and Arlan Hamilton of Backstage Capital, Sarah Imbach of PayPal/LinkedIn. Read more.

- ALPEN Storage, a Charlottesville, Va.-based provider of a bike storage capsule, raised $1.5 million. Felton Group led the round.

- Queens Gaming Collective, a Los Angeles-based gaming lifestyle company aimed at women, raised $1.5 million in funding. BITKRAFT Ventures led the round.

- Infinicept, a Denver-based maker payments infrastructure, raised an undisclosed amount of funding from Mastercard and MissionOG.

PRIVATE EQUITY

- American Securities agreed to acquire and take private Foundation Building Materials (NYSE: FBM), a Santa Ana, Calif.-based specialty building products distributor, for about $1.4 billion.

- Cerberus will take Dorel Industries, a Canadian maker of  bicycles and home products, for about C$470 million ($359 million).

- Arsenal Capital Partners acquired Best Value Healthcare, a Florida-based primary care platform focused on Medicare Advantage.  Financial terms weren't disclosed.

- Central Logic, backed by Rubicon Technology Partners, acquired Ensocare, an Omaha-based company for referring patients from hospital to post-acute care. Financial terms weren't disclosed. 

- Clearlake Capital Group acquired Zywave and Advisen, providers of front office insurance. Aurora Capital Partners, previously the majority owner of Zywave, is investing alongside Clearlake. Financial terms weren't disclosed.

- CenterOak Partners formed CollisionRight, a Columbus, Oh.-based operator of auto body repair services formed through a network of 20 shops. Financial terms weren't disclosed.

- Gryphon Investors acquired Vessco, a Minneapolis distributor automation equipment and services to water and wastewater treatment utilities. Financial terms weren't disclosed.

- Investcorp Holdings will acquire a majority stake in Viz Branz Pte, a Singaporean instant beverage maker, from Beng Chng. The sale could value the firm at $372 million. Read more

- KKR invested in CMC Machinery, an Italian maker of packaging solutions. Financial terms weren't disclosed.

- KKR invested $100 million in Zeus Health (“Zeus”), a company formed by Duke Rohlen seeking to invest in emerging medical device companies. 

- SemiTorr, backed by Transom Capital Group, acquired M-I-C, a Livermore, Calif.-based seller of equipment to biotech, pharmaceutical and industrial customers. Financial terms weren't disclosed.

- AccentCare, backed by Advent International, combined with Seasons Hospice & Palliative Care, a Rosemont, Ill.-based health, personal care services provider. Financial terms weren't disclosed.

- Two Circles, backed by Bruin Sports Capital, acquired TRM Partners, a U.K.-based sports rights management business. Financial terms weren't disclosed.

EXITS

- Carlyle Group is weighing plans to sell Hunkemoller, a Dutch lingerie and swimwear retailer, per Bloomberg. Read more.

- OMERS Private Equity acquired TurnPoint Services, a Louisville, Kentucky-based provider of HVAC services, from Trivest Partners. Financial terms weren't disclosed.

Breakups and Hangups

- Francesca’s (Nasdaq: FRAN), a Houston-based women’s clothing retailer, plans to permanently shutter 140 stores by the end of January and may file for bankruptcy.

OTHER

- PNC Financial will acquire BBVA (MC:BBVA)’s U.S. business for $11.6 billion in cash to create a new banking giant.

- Home Depot (NYSE:HD) plans to acquire HD Supply Holdings (Nasdaq: HDS), an industrial materials wholesaler it once owned, in a deal valued at about $8 billion.

- Baidu (Nasdaq: BIDU) agreed to acquire Joyy’s (Nasdaq: YY) livestreaming business for China for about $3.6 billion. Read more.

- Scooter Braun sold Taylor Swift’s first six albums to Shamrock Holdings, valuing the portfolio at $300 million, per Bloomberg. Read more.

- Banco Santander agreed to acquire technology assets from Wirecard AG, German payment processor. Financial terms weren't disclosed. Read more.

- IBM (NYSE: IBM) plans to acquire TruQua Enterprises, a Chicago, Ill.-based IT services and consulting firm. Financial terms weren't disclosed.

IPO

- Olema Pharmaceuticals, a San Francisco-based biotech developing therapies for women's cancers, plans to raise $170 million at the midpoint of its offering. Backers include BVF Partners, Cormorant Asset Management, and Janus Capital Management. Read more.

SPAC

- Bird, the Santa Monica, Calif.-based scooter company, is looking to go public via merger with a SPAC, per Bloomberg citing sources. Read more.

- Far Peak Acquisition, a SPAC formed by former NYSE President Tom Farley, filed to raise $550 million. Read more.

- Gores Holdings VI, a SPAC formed by The Gores Group, now says it plans to raise $300 million, down from the $525 million it previously sought. Read more.

- Highland Transcend Partners I, a blank check company formed by Highland Capital Partners, filed to raise $250 million. Read more.

- Trepont Acquisition I, a SPAC led the round by Arun Sarin (a former CEO at Vodafone), filed to raise $200 million. Read more.

- Aequi Acquisition, a SPAC, now says it plans to raise $200 million, down from the $300 million it previously sought. Read more.

- 10X Capital Venture Acquisition, a SPAC formed by 10X Capital, now says it plans to raise $175 million, down from the $220 million it previously sought. Read more.

- L&F Acquisition, a SPAC formed by Victory Park Capital, now seeks to raise $150 million, down from the $200 million it previously sought. Read more.

F+FS

- Thomas H. Lee Partners closed THL Automation Fund, which will back automation companies, with $900 million. 

PEOPLE

- MSD, the investment arm formed by Michael Dell, added Gregg Lemkau to lead the firm. Read more.

- Emergence Capital promoted Jake Saper to general partner and Carlotta Siniscalco to principal. 

- Cornell Capital promoted Emily Pollack to partner.