As CEO of Expedia in 1999, Rich Barton missed out on the excitement of the company’s initial public offering. After all, the online travel company priced shares on the day that Barton’s first child was born, and the high-tech executive wisely chose to be with his wife in a hospital room instead of on Wall Street.
So, when Zillow went public last week — the company Barton co-founded with former Expedia executive Lloyd Frink — he didn’t want to miss out on the festivities. He traveled to New York to push the button on the Nasdaq stock exchange, opening trading for the day and a new chapter for the online real estate company.
Standing at the Nasdaq with CEO Spencer Rascoff; CFO Chad Cohen; co-founder Lloyd Frink and other members of the Zillow team “was a good moment,” Barton said.
But the 44-year-old executive chairman is quick to point out that the IPO is just the beginning for a company that’s attempting to transform how people find information about homes, mortgages, rentals and more.
Zillow’s stock has maintained its value over the past few days — now trading at $35 per share with a market value of $960 million. (Clarification: Market value includes both Class A and Class B shares). Signaling even more strength for the offering, the company’s underwriters purchased another 519,000 shares of the company on Monday, adding an additional $9.7 million to Zillow’s coffers. Total proceeds from the IPO now stand at $85.1 million.
Even so, the daily stock fluctuations are not really something that Barton’s focusing on at the moment.
“The performance that I am psyched about is how well the team executed on getting the business to where it has gotten, and how rapidly it is growing from a business perspective and revenue perspective,” Barton tells GeekWire.
Barton described the IPO as an “incredible milestone” and a “great accelerant to the business.” But, even so, he said the company is much more focused on what’s ahead.
“We are trying to build this thing for the long-term just as we always have, so we are psyched about that,” he said. “It is like being drafted from the minors into the majors, everyone is working with that much more focus and that much more intensity. It is fun to see.”
Zillow certainly isn’t without its critics, with IPOFinancial.com’s David Menlow telling Reuters last week that the company is “absolutely not” worth its valuation. Zillow is losing money on a net income basis, albeit a small loss of just $827,000 last quarter.
A number of critics have also pointed to Zillow as a sign of a possible bubble in technology stocks.
Asked about the critics, Barton pointedly noted that it is just “short-term noise.”
Citing the teachings of economist Benjamin Graham, Barton noted that the stock market in the short-term acts as a “voting machine” and in the long-term it acts as a “weighing machine.”
“We are focused on Zillow on building that mass, building that weight,” said Barton.
I also got a chance to ask Barton about international expansion, something that I failed to bring up with Rascoff when we spoke last week. Zillow currently operates a databases of 100 million homes in the U.S., so I was curious if the company may use some of its IPO proceeds to go global or at least expand in Europe or Asia.
“It is something that is in our blood, and we’ve done it before,” said Barton, referring to the global expansion at Expedia. “We, however, are really focused on nailing the opportunity in the U.S. right now and we will worry about international later. We think there is big opportunity, and it is nice to be public to have more strategic optionality to do international perhaps. But we certainly don’t have any plans right now.”
Previously on GeekWire: “Q&A: Zillow CEO Spencer Rascoff takes the long view after first-day IPO pop”