Airbnb has signed a $500m deal to sponsor the Olympic Games until 2028, as the accommodation-booking platform targets the world’s biggest sporting event.
On Monday, the San Francisco-based company announced it had joined an elite corporate list that includes Coca-Cola, Alibaba and Toyota as part of the “worldwide sponsorship programme” for the International Olympic Committee, the governing body of the games.
The deal covers the next five Olympics starting with next year’s in Tokyo, and including the subsequent winter and summer games in Beijing, Paris, Milan and Los Angeles. The five cities are among Airbnb’s biggest markets for private accommodation rentals worldwide.
People briefed on the negotiations valued the deal at about $500m, which includes a substantial payment to the IOC but takes into account the cost of services that Airbnb will provide, such as free accommodation to athletes and executives.
The contract is in line with other recent sponsorships of the IOC, such as with Bridgestone and Panasonic, which have paid between $200m-$250m over a four-year Olympic cycle. According to the IOC, its top 12 sponsors provided revenues of a little more than $1bn for the 2014 winter games in Sochi and 2016 summer games in Rio de Janeiro.
It is the first time Airbnb has signed a large sponsorship deal. The group has previously turned away approaches for broad marketing initiatives, such as working alongside airlines to create package holidays, a person familiar with the company’s thinking said.
However, Airbnb executives decided the Olympics offers rare reach for a company that operates in the majority of countries and big cities across the world.
The move is designed to promote Airbnb’s brand to new hosts and customers, as it prepares an initial public offering planned for next year. The company, which was founded in 2008, has about $3.5bn of cash, providing the financial firepower for the Olympics deal, a person familiar with the matter said.
Last month, investors trying to buy indirect stakes in the Airbnb in private markets valued the group at up to $42bn. The US company said it had revenues of more than $1bn in the second quarter of this year. It generated profits, before interest, taxes, depreciation and amortisation expenses, in 2017 and 2018.