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AirbnBaller (Private:AIRB) | Seeking Alpha

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While the entire professional class, and every elected official, all claim to be optimists, I see the world through gray-colored glasses. Vaccine by fall, herd immunity, a robust recovery, markets will continue to surge, AI …

Yeah, right.

Pessimists are underappreciated, as while optimists built the first plane, pessimists suggested seat belts. Both parties have a role. Neville Chamberlain, Charles Keating, and Bobbi Brown were all likely optimists. But I digress.

So, being angry and depressed doesn’t mean I’m wrong. There are good companies that are overvalued (Tesla (NASDAQ:TSLA), Snowflake (NYSE:SNOW)), good businesses whose emissions are bad for society (Facebook (NASDAQ:FB), Twitter (NYSE:TWTR)), and firms that are just a menace (Uber (NYSE:UBER)). There are also firms that are all three (Palantir (NYSE:PLTR)). However, occasionally there is a firm that is so gangster even I can’t help but see the glass as half empty, vs. empty. The most valuable private firm in America is Airbnb (AIRB).

I believe this time next year, Airbnb will be the most valuable hospitality firm in the world and one of the world’s 10 strongest brands. (Note: rankings of “the world’s best brands” are a desperate yelp for relevance from ad agencies begging clients to buy more media and cling to the nineties, the Brand Era.) The SF platform will likely be worth more than the three largest hotel firms, combined. Why?

The Biggest Moat in Travel

Ride hailing requires local supply (drivers) and demand (hailers). Hotels need local supply (hotel rooms) and regional demand (guests). But a global hotel brand requires both local supply and global demand, as guests are from all over the world. Airbnb has global supply, boasting more than 7 million listings worldwide — more than Marriott International (NASDAQ:MAR), Hilton Worldwide (NYSE:HLT), InterContinental Hotels Group (NYSE:IHG), Wyndham Hotel Group (NYSE:WH), and Hyatt Hotels (NYSE:H), combined. More impressive, and singular, Airbnb is the only hospitality brand that has the global awareness to generate unrivaled demand.

In 2021, there will be more Airbnb users in the U.S. than people in California.

Outside of luxury, which is not relevant/affordable to 90% of travelers, there isn’t a truly global brand, until now. Google searches reflect that Airbnb has eclipsed the equity of century-old brands, in one decade, across markets big and small. While competitors may have equity in a specific market, no brand sits on the iron throne across all markets as Airbnb does.

This equity also bests that of airlines and online booking engines that may have global awareness (like Qantas) but only regional relevance (i.e., not an option for intracontinental travel in markets outside Australia).

So, how to value the gangster of all private gangsters? What is the benchmark and the corresponding multiple? It’s clearly not a hotel business, but not a SaaS firm either. However, Airbnb is a tech firm and highly “disruptive.” The firm has a greater share of employees with an engineering background than Amazon (NASDAQ:AMZN) or Uber.

How to Value?

The only firms I can think of that have global demand/supply and brand equity, and an asset-light high-margin business are the credit card companies, which trade at 20+ multiples of revenue. Airbnb projects 2021 revenues of $5-6 billion, yielding a potential $100-120 billion valuation.

In 2020, in the private markets, Airbnb shares have traded at a valuation ranging between $15-30 billion. The media pegs the IPO valuation at $30 billion. Put on your seatbelts, as the bankers will have no excuse to not price the shares at the high end of a recast (higher) range, and then reward their institutional clients with a Snowflake-like flurry when it begins trading. There’s something about weather and cruise analogies that becomes more appealing as you get older.

Ali vs. Holmes

In 1980, 38-year-old Muhammad Ali returned to the ring to fight a 30-year-old undefeated Larry Holmes. In the pre-fight examination Ali was unable to consistently touch his finger to his nose, had difficulty coordinating the muscles used in speaking, and could not hop on one foot. Boxing pundits describe the medical clearance to fight as criminal. I’m pretty sure the physician who cleared Ali for the fight now serves on the board of Facebook.

It’s difficult to identify another sector, this large, that has one player more ascendant while the rest of the industry can’t touch its nose. The hospitality sector has experienced an unprecedented shock that dwarfs 9/11 or any recession. Recessions, even wars, take occupancy levels down to 60%, or even 50%. No hotel owner or management firm modeled occupancy dropping to 0%. The result is an entire industry on its heels, except for one player that’s on its toes, waiting to spring forward with an information-age Super Bowl ad, the Initial Public Offering, and begin firing a howitzer of capital as other firms return fire with squirt guns.

Airbnb is also a better value than hotels, offering more space but with less Covid (no check-in, elevators, or common areas) at a lower cost. A crisis is a terrible thing to waste, and Covid afforded the CEO the cloud cover to cut costs and refocus on the core business. In May Airbnb laid off a quarter of its staff (1,900 employees). CEO Chesky managed to pull a Bezos and was seen as a hero for his empathetic approach to layoffs (generous severance, extended healthcare, and a website of Airbnb employees who were laid off to help them find new leads). Firing people, sending out private pics — tomato/tomahto. Chesky and co-founders relinquished their salaries, cut pay in half for executives, and slashed nearly $1 billion in marketing expenses. The firm is in fighting shape.

The reduced cost structure and market recovery mean the path to profitability has become bigger, better lit, and shorter. There are rumors the firm will accelerate into/through profitability in 2021. The story here won’t be one of distant, but burgeoning, profits.

The New Story Stock

The story stock of 2020, where the narrative rode shotgun as the numbers sat quietly in the backseat, was Tesla. Airbnb will not electrify the world, but it will host it and reshape the resources required to let people tap into a basic instinct: to explore with others. What Airbnb lacks in story (unlikely Mr. Chesky can land two Brooklyn studio apartments on dual barges concurrently), it makes up in performance. There is no better vision than performance.

Friday morning I was on Bloomberg TV discussing SPAC stocks. Despite the echoes of “It’s different this time,” I believe SPACs are canaries in the digital coal mine and will continue, over the medium- and long-term, to underperform the market (note: this year they have overperformed). My advice, if you want to play SPACs, is to buy a basket, as among the bastards (I’m rewatching all eight seasons of GOT with my son), a dragon will be birthed. Or you could just buy the dragon… Airbnb.

P.S. On the pod I spoke to Sinan Aral about his new book on social media and how to overcome its negative effects. And… we have a new sprint — Product Strategy, taught by my NYU Stern colleague Professor Adam Alter.

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Editor’s Note: The summary bullets for this article were chosen by Seeking Alpha editors.





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Hedge fund inflows at highest since 2018 in third quarter By Reuters

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© Reuters.

TORONTO (Reuters) – Hedge funds added $13 billion of assets between the start of July and end of September, the first time the industry has generated net inflows in any quarter since 2018, data from industry tracker Hedge Fund Research (HFR) showed.

Total assets managed by the hedge fund industry rose to $3.31 trillion at end-September, with macro strategies receiving $7.2 billion and trend-following strategies gaining $3.2 billion, the data showed.

The HFRI 500 Fund Weighted Composite Index gained 3.6% in the third quarter, bringing year-to-date performance to 0.8%. The S&P 500 would have made gains of 5.57% over the same period.

“Institutions globally are making forward-looking allocations to hedge funds, anticipating and positioning for the near-term uncertainties of both the virus and the U.S. election,” said Kenneth J. Heinz, President of HFR, said in the press release.

The hedge fund industry has come in for criticism for high fees and returns that have not matched those achieved by index trackers.

Hedge funds made 10.45% on average in 2019 compared to the S&P index tracker, which would have made 31.45% over the same period, the data showed.

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.





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France stocks lower at close of trade; CAC 40 down 1.53% By Investing.com

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France stocks lower at close of trade; CAC 40 down 1.53%

Investing.com – France stocks were lower after the close on Wednesday, as losses in the , and sectors led shares lower.

At the close in Paris, the lost 1.53%, while the index declined 1.55%.

The best performers of the session on the were Vivendi SA (PA:), which rose 1.57% or 0.39 points to trade at 25.25 at the close. Meanwhile, Renault SA (PA:) added 0.81% or 0.20 points to end at 24.39 and Publicis Groupe SA (PA:) was up 0.51% or 0.16 points to 31.31 in late trade.

The worst performers of the session were WFD Unibail Rodamco NV (AS:), which fell 5.11% or 2.12 points to trade at 39.38 at the close. Airbus Group SE (PA:) declined 4.30% or 2.88 points to end at 64.06 and Compagnie de Saint Gobain SA (PA:) was down 3.77% or 1.38 points to 35.21.

The top performers on the SBF 120 were Virbac SA (PA:) which rose 2.29% to 223.50, Television Francaise 1 SA (PA:) which was up 1.95% to settle at 5.22 and Ingenico Group SA (PA:) which gained 1.85% to close at 135.05.

The worst performers were Mercialys SA (PA:) which was down 5.28% to 4.52 in late trade, WFD Unibail Rodamco NV (AS:) which lost 5.11% to settle at 39.38 and Sodexo SA (PA:) which was down 4.54% to 60.14 at the close.

Falling stocks outnumbered advancing ones on the Paris Stock Exchange by 356 to 193 and 96 ended unchanged.

The , which measures the implied volatility of CAC 40 options, was up 5.61% to 29.23 a new 3-months high.

Gold Futures for December delivery was up 0.68% or 13.05 to $1928.45 a troy ounce. Elsewhere in commodities trading, Crude oil for delivery in December fell 4.48% or 1.87 to hit $39.83 a barrel, while the December Brent oil contract fell 3.85% or 1.66 to trade at $41.50 a barrel.

EUR/USD was up 0.43% to 1.1872, while EUR/GBP fell 1.18% to 0.9022.

The US Dollar Index Futures was down 0.56% at 92.532.

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.





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Disney’s Bob Iger to join board of animal-free dairy maker Perfect Day By Reuters

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© Reuters. European premiere of “The Lion King” in London

(Reuters) – Walt Disney (NYSE:) Co Executive Chairman Bob Iger will share a board seat at animal-free diary maker Perfect Day along with co-founders Ryan Pandya and Perumal Gandhi, the company said on Wednesday.

“We’re focused on rapid commercialization in the U.S. and globally. But we know we can’t do it alone,” co-founder and Chief Executive Officer Pandya said on Iger’s appointment.

Plant-based or meatless foods have grown in popularity in recent years, with several major fast-food chains introducing such items across the globe, as diners become more conscious of how their food is sourced and its impact on the environment.

The Bay Area startup counts Singapore state investor Temasek Holdings and Hong Kong-based venture capital firm Horizons Ventures as lead investors. It has so far received $360 million in total funding.

Temasek will be represented on the board by Aftab Mathur and Patrick Zhang will represent Horizons.

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.





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