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Airbnb is making what could be its biggest acquisition yet, plunging fully into the hotel space by acquiring HotelTonight, the provider of last-minute, boutique options for a night’s stay.
The announcement further cements Airbnb’s transformation from a mere platform for wayward travelers looking for a spare room in an off-beat home into a full-fledged travel company that is increasingly similar to the hotel incumbents it began to replace more than a decade ago.
Airbnb has over the last several years been trying to expand its revenue lines beyond its core business of facilitating the rental of rooms in people’s houses. It launched an experiences line that sells things like fitness classes and has slowly added hotel rooms from more independent providers — like those found on HotelTonight.
Deal terms weren’t immediately disclosed, but HotelTonight’s last private valuation almost two years ago was north of $450 million. The company has said it was profitable since 2016. So it’s safe to say this is costing a good bit of change to Airbnb, which is preparing to go public likely early next year. Airbnb’s biggest prior acquisition was its purchase in 2017 of Luxury Retreats for a reported price of around $200 million.
“A big part of building an end-to-end travel platform is serving every guest, whether they plan their trip a year or a day in advance,” said Airbnb CEO Brian Chesky. “Working with the incredible team at HotelTonight, we will offer guests an unparalleled last-minute travel experience that provides unique, memorable hospitality on every trip, on any schedule, at any time.”
Airbnb has been working to add alternative options to the couch-in-a-living-room that originally gave the company its prominence. Last year, the company unveiled changes like a loyalty program and began to allow its guests to book rooms through the portal in boutique hotels, bed-and-breakfasts, and vacation homes.
At its founding, Airbnb was on a warpath against the incumbent hospitality industry — and the feeling was pretty mutual. Hotel chains have lobbied intensely against Airbnb and tried to say that the home-sharing rival plays by a different set of rules than the Hiltons and Marriotts of the world.
Airbnb is now encroaching further on their turf, as the HotelTonight acquisition makes clear. But in some ways, that cultural disconnect represents a challenge for Airbnb: It is no longer merely a bonhomie startup filling some spare beds in a few apartment buildings.
But as it expands into fields like travel content, perhaps airlines, and now a full menu of boutique hotels, the task for Airbnb will be to maintain the mission that made it a $30 billion company in the first place.
This article originally appeared on Recode.net.
