Ahead of the company’s IPO, Airbnb has agreed to purchase HotelTonight, a booking service for last-minute travelers. While the purchase price is undisclosed, HotelTonight was valued at $463 billion two years ago. The acquisition was made to capture the growing demand for same-day bookings, according to Chief Executive Brian Chesky. HotelTonight will be kept as a separate brand and the company’s founder Sam Shank will join Airbnb.
Original built as a platform for people to rent out their homes, Airbnb continues expanding its offerings into the hotel industry. The company purchased Luxury Retreats, a service focused on renting high-end homes, for a price between $200-300 million in 2017. Airbnb plans to go public in June of this year
Although Airbnb dominates the home-sharing market, other hospitality players have responded by making acquisitions of their own. Most notably last October Expedia acquired startups Pillow and ApartmentJet, which help landlords turn apartments into short-term rentals. It also purchased HomeAway for $3.9 billion in 2015 to grab a larger share of the home-sharing market.
Hotels have also responded to the Airbnb effect with acquisitions of their own. Most notably in 2015, Marriott announced it would Starwood for $12.2 billion to create the biggest hotel chain. In 2018 Wyndham Worldwide also purchased La Quinta for $1.95 billion.