The market’s urge for food for tech firms holding preliminary public choices (IPOs) of inventory continues to construct, as Airbnb pushes for higher prices for its IPO.
On Sunday (Dec. 6), Airbnb said it was increasing its IPO price range to between $56 and $60 a share, up from a previous range of $44 to $50.
In addition, food delivery platform DoorDash aimed to raise up to $3.14 billion in its IPO. The company planned to sell 33 million common shares for $90 to $95 apiece, up from $75 to $85 a share, according to a U.S. Securities and Exchange (SEC) filing on Friday (Dec. 4).
In fact, the stock was offered at $102 per share on Wednesday (Dec. 9).
The Wall Street Journal reported on Wednesday that with Airbnb’s expected price, it could be valued at more than $42 billion. The IPO is expected to raise more than $3.3 billion.
The Journal said that Airbnb’s executives and its underwriting team will be closely watching DoorDash’s IPO, set for Wednesday (Dec. 9). Both Airbnb and DoorDash are making their stock market debut this week.
So far this year, well over $140 billion has been raised on U.S. exchanges. That’s way more than the full-year record of $107 billion set at the height of the dot-com boom in 1999, according to Dealogic.
Airbnb seems poised for a major comeback after being pummeled by the global pandemic. In fact, the company had planned to hold its IPO earlier this year. Under pressure, CEO Brian Chesky moved to keep the company going by raising capital on the private markets. The company also laid off a quarter of its staff and eliminated non-core operations.
Because of the cuts, plus an unexpected boost in local stays, business improved in the third quarter. In fact, Airbnb posted a profit of $219 million for Q3.
However, Airbnb is not out of the woods yet, as the COVID-19 crisis continues to put a crimp on travel. Another challenge looming is that cities across the globe may put zoning restrictions on short-term rentals.