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The technology companies Pinterest and Zoom Video Communications each set the price of the shares of their initial public offering above their previous price ranges, highlighting stronger investor demand than previously indicated.
The news suggests that the fall of Lyft, whose shares have dropped 17% since its stock market debut two weeks ago, has not dampened Wall Street's appetite for the latest batch of IPOs. stock market in the technology sector.
However, some badysts have described Pinterest's previous price range as very cautious, while others have said the performance of recent IPOs such as Lyft would not likely have a significant impact on aggregate demand.
"The fact that some trade is increasing and some trade is going down will not affect any of these [IPOs]except at the margin, "said Lise Buyer, an IPO consultant in Silicon Valley, who did not participate in any of these deals.
Institutional investors will appreciate the companies on their merits, regardless of the receipt of Lyft shares, she added, although "consumer enthusiasm may be affected by the fact that Lyft has not known good two weeks ".
Pinterest, the San Francisco-based visual media site, valued its shares at $ 19 each, generating $ 1.4 billion. Although the indicated price range is between $ 15 and $ 17, it was still 12% lower than the price at which it last sold shares in the private market two years ago.
$ 36
The price of Zoom shares during its debut as a public limited company
In addition to Twitter and Snap, Pinterest is now considered one of the few companies to attempt to create a large online advertising company, against the giants of the industry, Google and Facebook. However, Twitter's and Snap's shares have underperformed since their respective IPOs, while Pinterest has so far failed to generate the expected returns for investors in the last round of fundraising. the society.
In contrast, Zoom, a video conferencing service for businesses, set the price of its shares at nearly 10 times the price that some private investors had paid two years ago. At $ 36 per share, the price was above the company's $ 33 to $ 35 range, which had already been increased to reflect demand.
Transactions valued Pinterest at $ 12.6 billion and Zoom at $ 10.5 billion, based on a diluted number of shares for each company, which included the value of options and share units. restrictions issued to staff.
They are part of the wave of IPOs expected this year of the so-called technology unicorns, whose valuations reached at least $ 1 billion with private funding. Uber, the most valuable US private technology company, is expected to list its shares at the beginning of next month at a valuation of up to $ 100 billion.
Pinterest, which presents itself as a "visual discovery platform," said in earlier documents that it foresaw revenue growth outside of the United States, but warned potential investors in its documents that "we are not going to see it." it "was still only at the beginning of our monetization efforts." . About 80% of American mothers are users.
The company, founded in 2010 and known for an ardent user base that publishes collages of home decorations, cooking and wedding, has been criticized by some for its lack of innovation. The company only launched advertising in 2015 and has not sought to allow a more direct purchase on the site.
Co-founder and CEO Ben Silbermann was also hailed for fleeing Silicon Valley's "growth at all costs" mentality at a time when companies such as Facebook are under fire for confidentiality criticism. of security.
Pinterest's net losses more than halved, from $ 130 million in 2017 to $ 63 million last year, with revenues up 60% to $ 756 million. In comparison, the Snap image sharing application lost $ 514.6 million the year before its release in 2017.
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Nevertheless, the San Francisco-based platform is overtaken by the likes of Google and Facebook, representing a small slice – less than 1% – of the digital advertising market.
The IPO marks a big win for Pinterest's promoters. Bessemer Venture Partners invested in May 2011, when the site was valued at $ 40 million. Its stake is now valued at nearly $ 1.2 billion, making it the largest investor in the company. At the same time, the venture capital firms FirstMark and Andreessen each have a stake of more than $ 800 million.
The big winners of Zoom are led by CEO Eric Yuan, a former Webex engineer, star of the previous generation of videoconferencing start-ups. The holdings of the company's venture capitalists, Emergence Capital and Sequoia Capital, are valued at nearly $ 1.1 billion and $ 1 billion, respectively.
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