There were a lot of doubters about whether Zillow had what it takes to become a publicly-traded company. But, at least in terms of the initial reaction, those doubters have been proven wrong. Shares of the online real estate company soared in their debut today. After pricing at $20 per share and raising $79.6 million, the company’s stock took off. Shares are now trading at $43.39, up 117 percent on the day.
That gives Zillow — which lost $827,000 on revenue of $11.2 million last quarter — a market value of $756 million. At one point during early morning trading, shares of the company hit $60 per share, giving the company a valuation of $1.6 billion.
[Update 10:15 a.m.: The stock has since fallen, but is still up more than 70 percent on the day, trading at $34 per share].
In an interview with GeekWire from New York, Zillow CEO Spencer Rascoff downplayed the big stock jump.
“Over the long-term, what happens to the stock today is pretty much irrelevant,” said Rascoff. “If we delight our tens of millions of users, and thrill our thousands of advertisers, then, over the long-term, the stock price will take care of itself.”
Zillow becomes the first technology company in Washington state to go public in about a year.
In many ways, Zillow is a bellwether IPO. It has a tremendous growth story for sure and a hugely experienced management team behind it, but it is still relatively small when it comes to publicly-traded companies. Investors also might not like that it is still losing money.
Nonetheless, the company impressed on Wall Street, since it boosted its IPO price to $20 above the initial projections of $12 to $14 per share. This is going to be a fun one to watch and leads to this week’s GeekWire poll:
GeekWire Interview: “Zillow CEO Spencer Rascoff takes the long view after first day IPO pop”