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Online home rental marketplace Airbnb raises $1.5B from General Atlantic, others

VCCircle_AirbnbOnline home rental marketplace Airbnb Inc is said to be raising $1.5 billion in a fund raising round led by U.S. private equity firm General Atlantic with participation from Hillhouse Capital, Tiger Global and others.

This fundraising round values Airbnb at $25.5 billion, The Wall Street Journal said in a report.

Quoting people familiar with the matter, the report said that Morgan Stanley is acting as the adviser to the deal, which also involves participation from Singapore’s Temasek Holdings, Kleiner Perkins Caufield & Byers, GGV Capital, China Broadband Capital and Horizon Ventures.

The report further stated that several public “crossover” investment funds such as Wellington Management, Baillie Gifford, T. Rowe Price Group Inc. and Fidelity Investments (who generally acquire stakes in private companies ahead of IPOs) are also participating in the round.

The development was first reported by the Financial Times.

In April 2014, Airbnb had closed a $450 million round of funding, led by private equity firm TPG, at a $10 billion valuation.

Previously, the company had raised $326 million from Y-Combinator (where it was incubated in 2009), Sequoia Capital, Youniversity Ventures, Greylock Partners, SV Angel, Keith Rabois, Elad Gil, Jeremy Stoppelman, Andreessen Horowitz, General Catalyst Partners, Jeff Bezos, Digital Sky Technologies, CrunchFund, Ashton Kutcher, Eniac Ventures and Founders Fund.

Airbnb, whose website rental listings range from private rooms to manors and islands, has become one of Silicon Valley’s most successful start-ups in the six years since it was founded by a trio of graduates – Brian Chesky, Joe Gebbia and Nathan Blecharczyk – from the Rhode Island School of Design and Harvard. Airbnb now has over 1.4 million listings across nearly 200 countries. As per media report, its revenues in 2013 was about $250 million, more than double what it made the year before.

Airbnb has operations in all the major cities of India. Smile Group had previously partnered Airbnb in 2011 to help it expand internationally in countries other than the US.

This is the second major global fund raising news this week. It was reported earlier this week that ride sharing major Uber Technologies Inc. is raising $1 billion investment led by Hillhouse Capital Group. According to separate media reports earlier in February this year, Uber had expanded its Series E round by $1 billion just weeks after the company closed a $1.2 billion round of financing , increasing total capacity for the round at $2.8 billion. In total, this would put a valuation of $50 billion on Uber.

The other two companies that have raised funding in the similar range are Alibaba Group Holding Ltd. that secured $1.6 billion in 2011 and Facebook Inc. that raised $1.5 billion before it went public in 2011.

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