Excerpt from CNBC

Like many mobile-first, on-demand service-based companies started in the early 2010s, HotelTonight saw similarities with two of the biggest disruptors in that category.

"That's how the world is moving: with Uber, you push a button and get a car; with GrubHub, you push a button and you get food," HotelTonight CEO and co-founder Sam Shank said during a June 2013 appearance on CNBC's "Squawk Box."

"With us, you push a button, and you get a place to stay," he said. "We're the app for on-demand shelter."

Launched in January 2011, HotelTonight looked to popularize a part of the travel and leisure sector that its founders felt had been overlooked: last-minute and same-day bookings.

HotelTonight grew to the point that it had more than 25,000 hotels in approximately 1,700 cities worldwide on its platform.

Ultimately Airbnb acquired HotelTonight on its road to an IPO in March 2019 in a deal reported to be worth more than $400 million. Simon said the deal was something that "just made sense," as the companies "were very complimentary in terms of product."

At the time, Airbnb CEO and co-founder Brian Chesky said the move was a "big part of building an end-to-end travel platform." The company also cited the demand from and for boutique hotels to be on Airbnb. Airbnb said at the time of the acquisition that the HotelTonight app and website would operate as it had before, something that is still true.

However, less than a year later the Covid-19 pandemic hit, which presented a new set of challenges for Airbnb to navigate while also trying to build that end-to-end platform HotelTonight was expected to be a big part of.

Jed Kelly, managing director of equity research at Oppenheimer & Co., said HotelTonight has "been operating pretty quietly within Airbnb."

"It hasn't been a big focus of the company just judging by the last like four shareholder letters, they don't talk about it," Kelly said. "When you see the Airbnb commercials it says 'Made possible by hosts.' That doesn't really scream hotels."

A spokesperson for Airbnb declined to make an executive available for comment.

Andrew Boone, a managing director at JMP Securities, a Cititzen Financial Group company, said while HotelTonight had likely helped Airbnb accelerate its relationship with hotels, he said "it's hard to say if it's been either successful or unsuccessful just because of everything that has happened that is exogenous to Airbnb."

Part of the challenge, Boone said, will be to see how travel trends evolve moving forward. Airbnb has benefitted from the trend of travelers choosing longer stays at alternative accommodations, often outside of major city centers, Boone said. HotelTonight, on the other hand, was more city-located, often appealing to customers who may have traveled for work last minute or stayed late after a show or sporting event, travel and entertainment sectors that haven't bounced back as well.

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