Almost two months after rumours first surfaced of a mammoth funding round, Airbnb has finally completed its Series B injection of $112 million in capital.
The latest round brings the total level of capital thrown into Airbnb so far to $119.8 million, illustrating the massive jump between the initial investment and the new support from Andressen et al.
Airbnb says the round will be used specifically to expand the business globally and capitalise on demand in countries outside of its home market of the US such as the UK, Germany, France and Brazil.
The company couldn’t have chosen more high profile backers from the US web investment community, with Andressen counting Facebook, Foursquare, Groupon, Skype and Twitter on its portfolio, and General Catalyst supporting Kayak, ITA Software, Room 77 and Ostrovok.
Airbnb’s growth in the last 12 months has clearly caught the eye and praise not only of the tech press in the US but major players such as Andressen, with its general partner Jeff Jordan moved enough to compare the business to none other than online auction giant eBay.
“Airbnb’s explosive growth and passionate community of users reinforce the uniqueness of what they’re doing, and in the same way eBay redefined online shopping, Airbnb is redefining the way the world thinks about accommodations.”
DST Global’s Yuri Milner calls Airbnb a “transformational company”.
The numbers are certainly on Airbnb’s side. It claims to have booked two million room nights so far, captures 30 million page views every month and a “social connections” feature added to the site in May this year has already reached 54 million.
But while the company has managed to secure pages of gushing coverage from the US media, helped not least by securing the services of Hollywood celeb Ashton Kutcher as a board member, some of its tactics to attract new property owners have come under fire.
Airbnb admitted in June 2011 that a rogue group of contract sales people had used Craigslist to make unsolicited approaches to owners to persuade them to sign up to the service.
Away from the (somewhat justified) hype surrounding Airbnb, other companies operating in the vacation rental market will no doubt be absorbing today’s announcement with mixed feelings.
Big players with vast financial warchests for growth and additional resources is likely to concern many of the smaller players, but two significant rounds of investment in recent months (Airbnb and Wimdu) illustrate the enthusiasm in the finance community that private rentals is one of the hot sectors of the industry in the coming years, a trail blazed long before Airbnb by Homeaway and more recently by TripAdvisor.
Brian Chesky, co-founder and CEO of Airbnb says:
“Today is a watershed moment â€“ both for Airbnb as a company and for our community â€“ that will enable us to touch new markets and expand our vision to make the worldâ€™s most interesting and inspiring places accessible to our users.”