Investment Details:
- Investment Date: July 2019
- Acquisition Price: $69.77 per share
- IPO Date: December 2020
- IPO Price: $146 per share
- Peak Price (March 2021): $206.74 per share
- Founded: 2008
- Total Funding Raised: $1.8B (8 rounds)
- Last Private Valuation: $20B
Our Thesis:
Entering 2019, Acuity recognized a transformational shift in the travel industry. Consumers were increasingly seeking unique, flexible, and cost-effective accommodations beyond traditional hotels. The sharing economy was no longer an experiment—it was the future. We identified Airbnb as the dominant force in this evolution, leveraging its powerful network effects, brand strength, and technology-driven platform to capture the growing demand. While competitors like VRBO and Craigslist had paved the way, Airbnb had built an unmatched ecosystem of hosts and travelers, giving it a defensible market position. Through our network, we secured shares at an attractive valuation, positioning us to capitalize on what we believed would be a breakout moment for the company.
The Industry:
Airbnb revolutionized the hospitality and travel accommodation industries by enabling homeowners to rent out their properties to travelers, offering unique alternatives to traditional hotels. Competitors like VRBO and Craigslist were early pioneers, but Airbnb’s user-friendly platform, strong community engagement, and technology-driven approach positioned it as the leader in the peer-to-peer rental space.
The Company:
Founded by Brian Chesky, Joe Gebbia, and Nathan Blecharczyk in San Francisco, Airbnb began as a way to help travelers find affordable accommodations while enabling homeowners to monetize spare rooms or properties. By 2020, the company had grown its global listings to over 4 million and had expanded its services to include offerings like Airbnb Experiences and Airbnb Plus.
Airbnb’s innovative approach to user experience, technology, and community-building played a key role in its success. The company maintained a focus on trust and safety, implementing measures such as verified reviews and secure payments. By 2020, Airbnb had hosted over 800 million guests and achieved profitability for the first time in 2022, with a net profit of $1.9 billion.
Despite challenges like the COVID-19 pandemic, Airbnb demonstrated resilience by adapting its offerings to meet the new travel landscape. They promoted longer-term stays and enhanced their cleaning protocols, positioning the company for continued growth.
Investment Outcome:
Acuity’s thesis was validated as Airbnb not only dominated the alternative accommodations market but also expanded its reach into new segments. The company’s IPO was a milestone moment, and its ability to scale and innovate amid evolving market conditions reinforced our conviction. Our early entry and strategic execution delivered significant returns, exemplifying Acuity’s ability to anticipate high-growth opportunities before they become obvious to the market.
