Airbnb to Buy HotelTonight to Expand Platform

The acquisition of the hotel booking app is aimed at advancing Airbnb's goal of offering an end-to-end platform for travelers.
Matthew HellerMarch 8, 2019
Airbnb to Buy HotelTonight to Expand Platform

Airbnb has agreed to acquire last-minute hotel booking service HotelTonight as it continues to expand beyond its core home stay business.

The deal gives Airbnb access to the HotelTonight reservation platform for more than 25,000 traditional and boutique hotels in approximately 1,700 cities worldwide as it seeks to broaden its menu of options for travelers. HotelTonight caters to business travelers or those looking to make last-minute bookings.

Airbnb has already diversified into tours and activities and verified accommodation listings. Since February 2018, it has been encouraging boutique hotels to use its platform as a distribution channel.

“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,” Airbnb CEO Brian Chesky said in a news release announcing the HotelTonight acquisition.

Terms of the deal were not disclosed but The New York Times reported Airbnb is paying a price in the region of HotelTonight’s last private valuation, $465 million.

While Airbnb has more than 6 million private accommodations listings, it still lags behind rival Booking.com, which has a total of 28.3 million hotel and private accommodation listings.

“Buying a company like HotelTonight could accelerate the company’s expansion, especially as it prepares for an IPO and as it faces short-term rental regulation battles around the world that threaten its core business,” Skift said.

Airbnb noted that in 2018, it more than doubled the number of rooms available on its platform in properties that hosts categorized as boutique hotels, bed and breakfasts, and other hospitality venues like hostels and resorts.

Airbnb guests have responded enthusiastically to the increased supply, the company said, adding that the expansion has also benefited home-stay hosts since “nearly 90 percent of guests who first used Airbnb to book a hotel room and returned to our platform for a second trip then booked a home.”

Skift warned, however, that the expansion push could “chip away at the community-based culture that the company has worked so hard to build and market over the past 11 years.”