Airbnb announced Wednesday that it is suspending its investment in the virtual travel company after losing the $1.5 billion in funding it had secured.
The move comes after it was announced in September that the company would sell its remaining stake in its global business to a group of investors led by China’s Alibaba Group Holding.
The group said in December that it was acquiring a majority stake in Airbnb, which has more than 6 million listings worldwide.
Airbnb was founded in 2014 by a pair of friends who were looking for a way to make it easier for people to come to cities around the world.
They wanted to make travel more accessible and affordable for those who had limited travel experience.
But with an estimated $1 trillion in annual revenue, Airbnb was considered one of the most successful companies in the world before its investment dried up.
Airbnb’s investors had hoped to put the company back on track by revamping the company’s business model and increasing the number of people who could book Airbnb rooms.
But the company quickly struggled to find investors after it fell behind its target of attracting 100 million users per year, according to an investor presentation.
Airbnb has been hit with lawsuits and regulatory scrutiny, but it continues to make significant investments in its platform, including its partnership with Disney World to help guests find lodging in the parks.
The company is also building out its own mobile app, the new $50 million platform called Airbnb Pass, that will allow travelers to book hotel stays on their mobile phones.
In October, Airbnb lost its second round of funding.
Airbnb CEO Brian Chesky had hoped that the investment would help the company get back on its feet, but the fund, led by the venture capital firm Kleiner Perkins Caufield & Washington, said the company was no longer profitable.
“The investment is no longer in our best interest,” a Kleiner spokesperson told The Associated Press.
Airbnb had initially planned to put back its $5 billion fund in October, but said in a statement that the decision to terminate the investment was made because “we believe the business model does not scale and does not deliver the long-term value that we expected.”
The move has been met with some criticism, with critics saying Airbnb is just trying to grab a quick buck in order to boost its earnings.
Airbnb also announced it will begin to remove ads from its app and its website after it lost the funding.
The ad revenue revenue from ads on Airbnb has helped the company survive for so long, but many have questioned the value of that revenue.
Airbnb announced last week that it would remove advertising from its website and app.
The platform has also faced criticism for having a large number of “subscription” members who have to pay monthly fees for the service.
Airbnb, for its part, has not revealed how much revenue it will lose from the ad revenue, but according to the company, the revenue is being used to support other important business initiatives.
Airbnb said that the “substantial advertising revenues from ad-supported hosts will be reinvested into the growth of the company and to ensure our growth as a company.”
Airbnb’s next round of financing is expected to be completed in the second half of this year.
