The rise of the Airtasker Ltd (ASX: ART) share price took the ASX by storm, surging from a listing price of 65 cents to a high of $1.965 in only two days.
The company is currently valued at more than $500 million despite achieving FY20 revenues of just $19.3 million. Its rich valuation comes with a promise of international expansion to leverage its scalable technology and perhaps bring the company closer to a reasonable valuation.
Airtasker's Australian marketplace currently represents approximately 99% of its revenue, with the remaining 1% derived from the United Kingdom. In 2020, it established marketplaces in New Zealand, Singapore and Ireland. It also intends to commence operations in the United States in 2021.
As it stands, a behemoth is blocking Airtasker's path to becoming a truly international platform. Should speed bumps get in the way of the company's growth story, this could impact the Airtasker share price moving forward.
Image source: Getty Images
Air … bnb or tasker?
Global accommodation marketplace, Airbnb has been in a trademark dispute with Airtasker since 2019, opposing its entry into Europe.
Airbnb believes that Airtasker has essentially ripped off its first characteristic syllable 'Air'. It argues the average consumer might assume that Airtasker is a special service or subsidiary of Airbnb.
On Sunday, The Sydney Morning Herald reported that in Airbnb's submission to the European Union Intellectual Property Office, it argues that its mark "is among the best known and most valuable marks in the world".
Despite the potential roadblock, Airtasker has remained confident of a positive outcome.
What's next for the Airtasker share price?
Based on the current Airtasker share price, the company commands a market capitalisation of $536.31 million. This equates to around 28 times the company's FY20 revenue. As such, the pressure could build for Airtasker to justify its current valuation.
Airtasker's 2-year compound annual growth rate for gross merchandise value, revenue and profit have been a respective 24.2%, 32.1% and 33.8% between FY19 and FY21 forecasts. At face value, its growth sounds mediocre when compared to tech shares such as Afterpay Ltd (ASX: APT) or Zip Co Ltd (ASX: Z1P) that trade at similar revenue multiples.
Airtasker's prospectus highlights its plans to drive growth by establishing marketplaces overseas.
The company estimates a total addressable market (TAM) for local services in Australia of approximately $52,309 million.
Looking over at other countries, Ireland's TAM for local services is estimated to be $6,393 million, with $4,890 million in New Zealand, $5,021 million in Singapore, $70,440 million in the United Kingdom and a whopping $504,058 in the United States.
The Airtasker share price closed Monday's session flat for the day at $1.365.
