Airbnb to acquire Hoteltonight

N EW YOR K • Airbnb agreed to buy Hoteltonight, its biggest acquisition yet, in a move to increase hotel listings on the site as the home- sharing startup prepares for an eventual public offering.

Airbnb didn’t disclose the financial terms of the deal, but according to Pitchbook Data, Hoteltonight was valued at US$463 million in a venture capital deal two years ago. In early 2017, Airbnb acquired Luxury Retreats for about US$300 million, its largest purchase at the time.

San Francisco-based Hoteltonight offers last-minute hotel bookings, seeking to tap into unused inventory largely in urban areas, and the app has been a travelindustry darling since it launched in 2010.

The acquisition extends Airbnb’s reach even further into the hotel industry, where it has been a disruptive rival since its launch just over ten years ago. Airbnb transformed the travel sector by persuading millions of people to open up their homes to strangers, and became such a market force that mainstream travel and hotel companies like Booking Holdings Inc. have been furiously spending to offer more home listings on their own sites. Last year, Airbnb began highlighting hotels on its website and introduced a loyalty program, taking a step further onto the turf of its rivals.

Hoteltonight appealed to Airbnb because it fits into the company’s own model and will help it cater to growing consumer demand for same-day bookings, according to the company.

Last year Airbnb more than doubled the number of rooms available on properties categorized as boutique hotels, bed-and-breakfasts, and other hospitality venues like hostels and resorts, according to the company. Airbnb has more than 6 million listings, just ahead of Booking with more than 5.7 million home-rental listings.

Hoteltonight’s app and website will continue to operate independently, but Airbnb will consider eventually integrating its boutique hotels and bed-and-breakfast listings onto its site. Once the acquisition is complete, Hoteltonight’s founder and chief executive Sam Shank will report to Greg Greeley, Airbnb’s president of homes.

The acquisition is a change in strategy for Shank, who has been talking about taking Hoteltonight public for well over two years. As recently as October, Shank said during an interview on Bloomberg TV that an initial public offering could be on the cards soon, saying: “We’re definitely thinking about it.”

Hoteltonight has leaned toward boutique hotels that offer quirky guest experiences with board games or pillow fight kits in the lobby.

For the past four weeks, Airbnb co-founder and chief executive Brian Chesky has lived out of Hoteltonight listings in and around San Francisco to try out the site. Chesky wanted to taste-test Hoteltonight as the deal approached, an Airbnb official said.

In November 2016, Chesky announced Airbnb was going to become an end-toend travel platform, offering flights, experiences and more.