Silicon Valley Business Journal/Cromwell Schubarth: Zoom gets billions more in investor love than Pinterest in their market debuts

Silicon Valley Business Journal
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Zoom gets billions more in investor love than Pinterest in their market debuts

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Zoom employees and investors crowded around a Nasdaq video board in downtown New York on IPO day that showed co-workers from around the world via their company's video technology.
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Zoom employees and investors crowded around a Nasdaq video board in downtown New York on IPO day that showed co-workers from around the world via their company's video technology.

Nasdaq
By Cromwell Schubarth
TechFlash Editor, Silicon Valley Business Journal
Apr 18, 2019, 10:45am PDT
Updated 7 hours ago

The value of Zoom Video Communications Inc. surpassed Pinterest Inc.'s on Thursday as both companies made their stock-market debuts.

The market cap of San Jose-based cloud-based video communications company Zoom ended its first day of trading on Nasdaq at nearly $16 billion.

That handily topped the valuation of just under $13 billion given to San Francisco-based Pinterest at the end of its first trading day on the New York Stock Exchange.

Both companies topped their IPO targets and their shares jumped in value in their market debuts. But Zoom's stock (NASDAQ:ZM) soared by around 72 percent and Pinterest's (NYSE:PINS) rose by nearly 29 percent.

Despite posting revenue that is less than half of Pinterest's, investors may be favoring Zoom because it has been profitable.

Pinterest last year posted a $63 million net loss on about $756 million in revenue. Zoom posted a $7.6 million profit on about $331 million in revenue.

Zoom's valuation jumped by about 16-fold on Thursday, compared to the $1 billion that private investors estimated it to be worth in its last funding round in 2017.

Pinterest's first-day market cap is only slightly higher than the $12 billion that it was estimated to be worth in a funding round in the same year.

“Zoom is that most unusual beast, which is a profitable IPO coming out of the tech sector,” Roger McNamee, co-founder of investment firm Elevation Partners, told CNBC on Thursday morning. “From a stock market point of view, that’s the one I find really compelling.”

The value of the stakes of the founders of the two companies has also changed dramatically as a result of their IPOs.

Zoom CEO Eric Yuan owns about 20 percent of his company, worth about $3.2 billion based on Thursday's stock prices.

Pinterest co-founder and CEO Ben Silbermann's 11 percent stake in his company is valued at about $1.4 billion, based on Thursday's prices. Co-founder Evan Sharp's 2.1 percent stake is worth about $267 million.
The List
Fastest Growing Private Companies in Silicon Valley
Ranked by Revenue growth 2015-17
Rank     Name     Revenue growth 2015-17
1     Livongo Health Inc.     1,347.8%
2     GridGain Systems     681.8%
3     GameChangerSF     430.4%
View This List
Companies In This Article

Pinterest, Inc.

San Francisco, CA

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Zoom Video Communications Inc.

San Jose, CA

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Nasdaq, Inc.

New York, NY

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New York Stock Exchange LLC

New York, NY

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