Zillow

Zillow Soars 200 Percent In First Trade With Over $1 Billion Valuation

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Shares of real estate listings site Zillow began trading on the NASDAQ under the symbol ‘Z’ today, opening at $60 per share. This gives the company a whopping $1.6 billion valuation. Zillow priced its IPO at $20 per share yesterday, after upping the pricing of its IPO to $16 to $18 per share, from the initial range of $12 to $14 per share. While the stock price soared to $60 per share in first trade but has dropped to $43 per share. Zillow raised $69 million in the offering.

According to Experian Hitwise, Zillow.com is the third most visited Real Estate site in the U.S and received 5.36% of Real Estate visits in March 2011, which is a 53% increase compared to March 2010. While Zillow is growing traffic, the company has been taking a loss in terms of net income for the past three years. But the company is cash-flow positive.

For the years ended December 31, 2008, 2009 and 2010, the company generated revenues of $10.6 million, $17.5 million and $30.5 million, representing year-over-year growth of 49%, 65% and 74%, respectively. And during the three months ended March 31, 2011, Zillow generated revenue of $11.3 million, as compared to $5.3 million in the three months ended March 31, 2010, an increase of 111%.

The company lost $12.8 million in 2009, and lost roughly half of that ($6.7 million) in 2010. The company, which launched to the public in 2006, also revealed that as of December 31, 2010, it has an accumulated deficit of $78.7 million. In the three months ended March 31, Zillow lost $826,000.

Zillow CEO Spencer Rascoff told us in an interview this morning that the new funds will be used for headcount growth, especially for developers and salespeople. He says that mobile usage has helped grow the company’s revenue and when it comes to prduct development priorities, mobile development is at the top of the list.

In terms of the timing of the public offering, Rascoff explained that the company was ready from business standpoint, but also believes the public offering helps company grow further. “Becoming a public company puts us on a whole new stage,” he says, “It’s like being drafted into the major leagues.”

Underwriters for the include Citi, Allen & Company, Pacific Crest Securities, ThinkEquity LLC, and First Washington Corporation.

Zillow currently lists over 100 million U.S. homes, including homes for sale, homes for rent and homes not currently on the market. Zillow launched a mortgage marketplace in 2008, and subsequently expanded into rentals and mobile, which has been a huge growth area for the company.

LinkedIn also saw a significant pop from pricing ($43 per share) to $83 in the first trade. The company’s stock continued to rise in the first day of trading but subsequently fell over the next month. But LinkedIn’s stock has rebounded, opening today at $101 per share.

Zillow’s pop is surprising considering the company has not made a profit yet. And a 200 percent increase in share value for the real estate listings company (which initially had a $500 million valuation) should only add fuel to the claims we are in a tech bubble.