Survivors and Thrivers – Critical Investment Themes for 2021

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As investors clink champagne glasses and bid 2020 farewell, I don’t think many will shed a tear. Next year is going to be so much better! “Hope springs eternal in the human breast.” – Alexander Pope

Looking at 2021, let’s consider some of the dominant investment themes that Covid-19 has thrust upon us. In any market money can be made – there are always survivors and thrivers.

The rapid acceleration in technology adoption, the importance of AI and machine learning, robotics, automation and the work-from-home trend are fundamental themes.

Let’s take Airbnb as a case study. At the start of 2020 the imminent Airbnb IPO (initial public offering) was anticipated with great excitement. Over the previous 10 years Airbnb had totally disrupted the travel and leisure industry. But it seemed Covid-19 had dealt it a death blow. A decade of incredible hard work and innovation seemingly destroyed in a matter of weeks.

But Airbnb is back! On Tuesday the company announced that it would be listing this month. The shares will be issued to applicants at between $44 and $50. At this level the company will be valued at $35 billion. About $2.5 billion will be raised in the initial public offering and existing investors will sell $96 million of stock.


The last valuation for Airbnb was agreed at $18 billion, when the company borrowed $2 billion to ensure its survival in the depths of the Covid-19 crisis.

Airbnb earned $219 million on revenue of $1,34 billion in the third quarter, which was down 19% from the year before. The company cut 25% of its staff, but the business has come back strongly. Rural rentals surged, which compensated for large falls in the big cities. People are looking for safe escapes.

Airbnb is a huge beneficiary of the work-from-home trend, but for the company this shift has become the work-from-anybody’s-home trend. On top of this there has also been an increase in the length of stays and this was expected.

Airbnb’s business model is flexible, pivotable, resilient and valuable to hosts and travelers seeking a safe environment during the global health crisis.


Today Airbnb is a globally recognised brand. It is now used in daily vocabulary as a verb or as a noun. Its popularity is unmatched among travel brands and its huge community is its greatest asset. The number of guests that post reviews continues to grow and is currently at 68%, and repeat guest revenue is now at 69%. Hosts and guests operate in more than 220 countries and the global network allowed Airbnb to operate during the Covid-19 crisis and offer travel spaces closer to home.

The platform is custom built. There are industry-leading features for hosts and guests, such as pricing recommendations, scheduling, integrated payments, community support, host protection mechanisms, reviews, feedback etc.

There are lots of safety features based on AI and automation.

The site also has a global payments capability and this is critical for its success. The platform is also available in 62 languages, which ensures that its services are localised for hosts and guests. The site has more than 4 million hosts and 7.7 million listings. Visitors can rent anything from a mansion in Milan to an igloo in Iceland.

Airbnb has come from nowhere and is the most successful and largest travel and accommodation business in a generation. And amazingly, it doesn’t own any hotels! It has grown from a weird and crazy idea to a new verb and is ubiquitous to the hotel industry and millions of travelers.

Airbnb is only one example of a survivor and thriver – there are hundreds more and this is a most fertile area for research and capital allocation.


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