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Redfin CEO Glenn Kelman rings the Nasdaq opening bell. (Nasdaq Photo)

UPDATE: Redfin stock increased close to 45 percent in the first day of trading, opening at $19.56 and closing at $21.70.

Redfin stock popped as it debuted on the Nasdaq exchange Friday morning, opening at close to $20 and climbing, well above the opening price of $15.

When the tech-powered real estate brokerage priced its stock at $15 in advance of its Wall Street trading debut this morning, it signaled strong interest on the part of investors. Redfin had planned to sell 9.23 million stocks at a range of $12 to $14. It is seeking to raise about $138 million through its IPO.

Redfin’s stock started trading around 8 a.m. Pacific, and about an hour and a half before, Redfin kicked off a new era as a public company by ringing the Nasdaq opening bell. A fired up Redfin CEO Glenn Kelman thanked employees and customers for helping the company get to this point, but added that it is only the beginning.

“We are excited to be here! This is a big day for Redfin. But it’s not just about going public, it’s not just about making money, it’s not just about building a great business, it’s about making real estate better for regular people,” he said. “We have done it our way, with real estate agents and software engineers working together as partners, where we are one Redfin.”

MarketWatch reports the company is seeking a valuation of $1.2 billion. By comparison, Seattle-based online real estate juggernaut Zillow — which does not compete directly with Redfin’s brokerage business — is valued at $8.6 billion.

Key to Redfin’s success as a public company is the question of whether its primary function is as a real estate brokerage or a tech company. And Kelman addressed that head-on as he prepared to ring the Nasdaq bell in New York City on Friday.

“It ain’t one company that’s working on software and another company that’s serving customers. We do it together,” he said. “And I am so proud that we have come together to this point. I wanted to thank all of the employees who worked so hard. It was hard, but it has been good! It’s been really good! And we have got so much in front of us.”

(Pamela Hayes-Kong Photo)

On one hand, Redfin uses technology everyday to make the real estate process easier, investing heavily in its mobile app, machine learning and other proprietary technology services. Redfin spent a whopping $34.5 million on technology last year, one third of its overall operating expenses.

On the other, its fortunes are still very much tied to the people-powered business of helping Americans buy and sell homes. What the market perceives Redfin to be will ultimately play a big role in its success as a public company, according to Robert Hahn, a management consultant at 7DS Associates who writes regularly about real estate and technology.

“If Redfin is a brokerage, making $256 million in revenues and losing tens of millions every year … it’s worth zip. Zilch. Zero. Nada,” writes Hahn. “If Redfin is a technology company that happens to make money from commissions … it’s worth $3 billion or so (or more!)”

Redfin CEO Glenn Kelman. (Photo Via Nasdaq Livestream)

Redfin, which sits atop the GeekWire 200 list of top privately held Pacific Northwest startups but will be removed following the public debut, has 2,427 employees, including 935 lead real estate agents, up from 752 in 2013. Redfin has raised nearly $170 million to date from investors like Madrona Venture Group, Greylock, Draper Fisher Jurvetson, Vulcan Capital, and Tiger Global. Each firm has around a 10-to-12 percent stake in Redfin.

Here’s a breakdown of the company’s top shareholders:

EquityZen, a company that matches shareholder offerings with investors through a marketplace, released a report this morning showing just how much these investors have made off their deals. Greylock’s shares today are worth $131 million, according to EquityZen, while Madrona’s 11.4 percent investment today is worth $121 million today. Kelman’s piece of the company now has a value of $39 million.

Redfin’s business is growing, and the company gained market share in 81 of the 84 markets in which it operated. Even so, Redfin’s market share stands at just 0.58 percent nationwide. In its oldest markets, Redfin’s market share still hovers below two percent.

Last year, Redfin brokers and affiliated real estate agents helped people in the U.S. buy and sell more than 75,000 homes, representing $35.3 million of Redfin’s $41.6 million in revenue.

Redfin is spending big as it continues to grow, taking losses along the way. It reported a loss of $28.1 million on revenue of $59.9 million for the first three months of 2017, according to the SEC filing. That’s compared to a net loss of $24.3 million on revenue of $41.6 million in the year-ago period.

You can read more about Redfin in this SEC filing, including many of the risk factors facing the company.

Kelman appeared this morning on CNBC, where he compared Redfin to Apple, Uber and Lyft. He said Redfin does not have a problem recruiting agents, because the agents are not working for a brand that feels like the “RadioShack of real estate” but instead the “Apple of real estate.”

“It’s a good customer covenant, it’s a great technology platform. And it’s a great career,” he said.

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