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Airbnb, DoorDash Aim for Higher-Than-Expected Valuations Ahead of Debuts

Airbnb and DoorDash set their sights high to cap off a record year for IPOs.
(Sundry Photography)
(Sundry Photography)
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“Airbnb Inc. and DoorDash Inc. are planning to release higher-than-expected valuation ranges for their initial public offerings, in the latest sign of strength in a booming market for new issues,” WSJ writes.

Airbnb is shooting past the $30 billion expected and aiming for a valuation as high as $33 billion. Meanwhile, DoorDash is looking past its initial expectation of $25 billion and targeting $28 billion.

  • It’s unclear what the per-share prices will look like yet.

A Tale of Two Stories:

  • During a 2017 funding round, Airbnb was valued at $31 billion. The pandemic ravaged the company, bringing down that number to $18 billion. It later recovered after borrowing money, slashing its marketing budget, laying off staff and setting projects aside.
  • DoorDash has continued its “sharp, upward march.” Its valuation grew to more than $15 billion this year, up from $1.4 billion in 2018 as it became the largest player in the food delivery sector.

Airbnb and Doordash plan to list in mid-December, which tends to be a “quiet month for offerings.” The two will cap off a “banner year for IPOs” — 2020 has seen record amounts of money raised for new issues on U.S. exchanges.

  • A total of 383 IPOs have occurred on U.S. exchanges this year, raising more than $140 billion.
  • Those numbers far exceed the full-year record high set during the dot-com boom in 1999, according to Dealogic (the data only dates back to 1995, though).

Looking Ahead: “Both companies and their respective underwriters will set their final IPO prices based on feedback from investors in the roadshows. Morgan Stanley and Goldman Sachs are leading Airbnb’s IPO, while Goldman and JPMorgan Chase & Co. are leading DoorDash’s.”

Justin Oh:

Please watch my YouTube videos on DoorDash and Airbnb to know more about what I think about these IPOs and if we’re going to be buying the stocks when they start trading.

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