Online rental service Airbnb Inc. has secured a $1 billion debt facility from some major U.S. banks that would help the startup develop new services and fund growth initiatives, reports said Wednesday, citing sources.
The debt deal was led by JPMorgan Chase & Co., Citigroup Inc., Bank of America Corp. and Morgan Stanley, according to Bloomberg, which first reported the story.
The financing will give Airbnb more money to spend on global growth strategies and expansion beyond its traditional ambit of home-sharing. The San Francisco-based company is reportedly building add-on travel services and running a TV ad campaign, which is an especially costly form of customer acquisition.
The company expects to achieve profitability in 2016. It raised over $100 million in a round of funding late last year. Airbnb has lost less than $250 million since it started operations in 2008, and generated roughly $1 billion in revenue in 2015.
Representatives at JPMorgan, Citigroup, Morgan Stanley and Bank of America were not available for comment whereas a spokesman for Airbnb declined to comment, according to reports.
Airbnb is currently facing complaints of racial bias from its users. To address this, it says it is planning a “comprehensive review” of the ways that private citizens renting their homes through the platform might use to discriminate against their prospective guests.
In a memo the company planned to send to concerned users earlier this month, Airbnb reportedly said that it will look into the matter over the next several months to see how hosts and guests interact with one another on the site. The former head of the American Civil Liberties Union’s Washington office is set to act as a paid adviser on the review whose findings should be announced in September this year.