Jeff Bezos Double Dips On His Airbnb Play

Kevin Vandenboss
·2 min read
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Amazon.com Inc founder Jeff Bezos made an early bet on the short-term rental platform Airbnb Inc during the company’s Series B round in 2011, nearly a decade before its initial public offering (IPO).

His investment came long before the now popular accommodations marketplace was a household name and a common term used to describe virtually any short-term rental.

It’s unclear exactly how much Bezos profited off his pre-IPO investment in Airbnb, but it’s clear that the billionaire investor had incredible foresight as to where the vacation rental market was headed.

More recently, Bezos’ investment activity suggests that he’s looking to profit from the other side of the vacation rental business – the real estate investments.

Bezos was one of several high-profile investors to participate in Arrived Homes’ seed round in 2021. Arrived Homes is a real estate investment platform that allows retail investors to become fractional owners of single-family rental properties with an investment of $100 to $10,000.

Less than a year later, Bezos made an additional investment in Arrived Homes’ $25 million seed round, just before the company publicly announced that it would be expanding its offerings to include short-term rental properties.

The company released its first fractional vacation rental on the platform yesterday, which was fully funded in less than 30 minutes. Six more properties are expected to go live today, including a four-bedroom home in Joshua Tree, CA, and homes in Arizona, Georgia and Florida.

However, new investors may have difficulty purchasing shares of the first batch of vacation rentals considering how quickly Arrived Homes has been funding the single-family properties on its platform. Existing investors have been the first to access new offerings and the same will likely be true once the rest of the short-term rental investments go live.

Short-Term Rental Market

Bezos’ renewed bet on the short-term rental market is looking promising for the tech entrepreneur turned venture capitalist. Airbnb reported its highest profit during the second quarter of 2022 and an all-time quarterly high of 103.7 million nights booked. Quarterly nights booked were up 25% year over year and average daily rates were up 1.7%.

With an average daily rate of $164, it’s no wonder that short-term rentals are becoming such a popular asset class among investors. According to research by Arrived Homes, vacation rentals generate up to 130% more revenue on average than traditional long-term rentals.

 

Browse fractional real estate investments on Benzinga's Real Estate Offering Screener and find investment opportunities that match your specific criteria.

Photo by lev radin on Shutterstock

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