Startups Weekly: Zoom CEO says its stock price is ‘too high’

When Zoom hit the public markets Thursday, its IPO pop, a whopping 81 percent, floored everyone, including its own chief executive officer, Eric Yuan.

Yuan became a billionaire this week when his video conferencing business went public. He told Bloomberg that he actually wished his stock hadn’t soared quite so high. I’m guessing his modesty and laser focus attracted Wall Street to his stock; well, that, and the fact that his business is actually profitable. He is, this week proved, not your average tech CEO.

I chatted with him briefly on listing day. Here’s what he had to say.

“I think the future is so bright and the stock price will follow our execution. Our philosophy remains the same even now that we’ve become a public company. The philosophy, first of all, is you have to focus on execution, but how do you do that? For me as a CEO, my number one role is to make sure Zoom customers are happy. Our market is growing and if our customers are happy they are going to pay for our service. I don’t think anything will change after the IPO. We will probably have a much better brand because we are a public company now, it’s a new milestone.”

“The dream is coming true,” he added. 

For the most part, it sounded like Yuan just wants to get back to work.

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IPO corner

You thought I was done with IPO talk? No, definitely not:

  • Pinterest completed its IPO this week too! Here’s the TLDR: Pinterest popped 25 percent on its debut Thursday and is currently trading up 28 percent. Not bad, Pinterest, not bad.
  • Fastly, a startup I’d admittedly never heard of until this week, filed its S-1 and displayed a nice path to profitability. That means the parade of tech IPOs is far from over.
  • Uber… Surprisingly, no Uber IPO news this week. Sit tight, more is surely coming.

$1B for self-driving cars

While I’m on the subject of Uber, the company’s autonomous vehicles unit did, in fact, raise $1 billion, a piece of news that had been previously reported but was confirmed this week. With funding from Toyota, Denso and SoftBank’s Vision Fund, Uber will spin-out its self-driving car unit, called Uber’s Advanced Technologies Group. The deal values ATG at $7.25 billion.

Robots!

The TechCrunch staff traveled to Berkeley this week for a day-long conference on robotics and artificial intelligence. The highlight? Boston Dynamics CEO Marc Raibert debuted the production version of their buzzworthy electric robot. As we noted last year, the company plans to produce around 100 models of the robot in 2019. Raibert said the company is aiming to start production in July or August. There are robots coming off the assembly line now, but they are betas being used for testing, and the company is still doing redesigns. Pricing details will be announced this summer.

Digital health investment is down

Despite notable rounds for digital health businesses like Ro, known for its direct-to-consumer erectile dysfunction medications, investment in the digital health space is actually down, reports TechCrunch’s Jonathan Shieber. Venture investors, private equity and corporations funneled $2 billion into digital health startups in the first quarter of 2019, down 19 percent from the nearly $2.5 billion invested a year ago. There were also 38 fewer deals done in the first quarter this year than last year, when investors backed 187 early-stage digital health companies, according to data from Mercom Capital Group.

Startup capital

Byton loses co-founder and former CEO, reported $500M Series C to close this summer
Lyric raises $160M from VCs, Airbnb
Brex, the credit card for startups, raises $100M debt round
Ro, a D2C online pharmacy, reaches $500M valuation
Logistics startup Zencargo gets $20M to take on the business of freight forwarding
Co-Star raises $5M to bring its astrology app to Android
Y Combinator grad Fuzzbuzz lands $2.7M seed round to deliver fuzzing as a service

Extra Crunch

Hundreds of billions of dollars in venture capital went into tech startups last year, topping off huge growth this decade. VCs are reviewing more pitch decks than ever, as more people build companies and try to get a slice of the funding opportunities. So how do you do that in such a competitive landscape? Storytelling. Read contributor’s Russ Heddleston’s latest for Extra Crunch: Data tells us that investors love a good story.

Plus: The different playbook of D2C brands

And finally, for the first of a new series on VC-backed exits aptly called The Exit. TechCrunch’s Lucas Matney spoke to Bessemer Venture Partners’ Adam Fisher about Dynamic Yield’s $300M exit to McDonald’s.

#Equitypod

If you enjoy this newsletter, be sure to check out TechCrunch’s venture-focused podcast, Equity. In this week’s episode, available here, Crunchbase News editor-in-chief Alex Wilhelm and I chat about rounds for Brex, Ro and Kindbody, plus special guest Danny Crichton joined us to discuss the latest in the chip and sensor world.

Fastly, the content delivery network, files for an IPO

Fastly, the content delivery network that’s raised $219 million in financing from investors (according to Crunchbase), is ready for its close up in the public markets.

The eight-year-old company is one of several businesses that improve the download time and delivery of different websites to internet browsers and it has just filed for an IPO.

Media companies like The New York Times use Fastly to cache their homepages, media and articles on Fastly’s servers so that when somebody wants to browse the Times online, Fastly’s servers can send it directly to the browser. In some cases, Fastly serves up to 90 percent of browser requests.

E-commerce companies like Stripe and Ticketmaster are also big users of the service. They appreciate Fastly because its network of servers enable faster load times — sometimes as quickly as 20 or 30 milliseconds, according to the company.

The company raised its last round of financing roughly nine months ago, a $40 million investment that Fastly said would be the last before a public offering.

True to its word, the company is hoping public markets have the appetite to feast on yet another “unicorn” business.

While Fastly lacks the sizzle of companies like Zoom, Pinterest or Lyft, its technology enables a huge portion of the activities in which consumers engage online, and it could be a bellwether for competitors like Cloudflare, which recently raised $150 million and was also exploring a public listing.

The company’s public filing has a placeholder amount of $100 million, but given the amount of funding the company has received, it’s far more likely to seek closer to $1 billion when it finally prices its shares.

Fastly reported revenue of roughly $145 million in 2018, compared to $105 million in 2017, and its losses declined year on year to $29 million, down from $31 million in the year-ago period. So its losses are shrinking, its revenue is growing (albeit slowly) and its cost of revenues are rising from $46 million to around $65 million over the same period.

That’s not a great number for the company, but it’s offset by the amount of money that the company’s getting from its customers. Fastly breaks out that number in its dollar-based net expansion rate figure, which grew 132 percent in 2018.

It’s an encouraging number, but as the company notes in its prospectus, it’s got an increasing number of challenges from new and legacy vendors in the content delivery network space.

The market for cloud computing platforms, particularly enterprise-grade products, “is highly fragmented, competitive and constantly evolving,” the company said in its prospectus. “With the introduction of new technologies and market entrants, we expect that the competitive environment in which we compete will remain intense going forward. Legacy CDNs, such as Akamai, Limelight, EdgeCast (part of Verizon Digital Media), Level3, and Imperva, and small business-focused CDNs, such as Cloudflare, InStart, StackPath, and Section.io, offer products that compete with ours. We also compete with cloud providers who are starting to offer compute functionality at the edge like Amazon’s CloudFront, AWS Lambda, and Google Cloud Platform.”

Equity Shot: Pinterest zooms into the public markets (and yet another tech company files for an IPO)

Hello and welcome back to Equity, TechCrunch’s venture capital-focused podcast, where we unpack the numbers behind the headlines.

This is a relaxed, Friday, Equity Shot. That means Kate and Alex were on deck to chew through the latest from the IPO front. We’ll keep doing extra episodes as long as we have to, though we’re slightly sorry if we’re becoming a bit much.

That’s a joke — we’re not sorry at all.

So, three things this week. First, Fastly filed an S-1 (Alex’s notes here); second, Zoom completed its highly anticipated IPO (Kate’s post here, Alex has notes too); and third, Pinterest went public too (more from TechCrunch here). Ultimately, Pinterest’s stock offering valued the company at $12.6 billion (higher than its latest private valuation), but we’ve got some notes on the “undercorn” phenomenon anyway (here and here).

Fastly is going public after raising more than $200 million at a valuation greater than $900 million. Founded in 2011, the content-delivery company surpassed the $100 million revenue mark in 2017, growing a little under 40 percent in 2018. It’s an unprofitable shop, but it has a clear path to profitability. And given how Zoom’s IPO went, it’s probably drafting a bit off of market momentum.

As mentioned, Zoom had a wildly successful first day of trading. The company ended up pricing its shares above range at $36 apiece, only to debut on the Nasdaq at $65 apiece. Yes, that’s an 81 percent pop, and yes, we were a bit floored.

Finally, Pinterest’s debut was solid, leading to a more than 25 percent gain over its above-range IPO price. What’s not to like about that? It’s hard to find fault with the offering. Pinterest got past the negative press and questions about private market valuations, went public, raised a truckload of money and now just has to execute. We’ll be watching.

If you’re looking for more Uber IPO content, don’t worry, there’s plenty more of that to come. See ya next week.

Equity drops every Friday at 6:00 am PT, so subscribe to us on Apple PodcastsOvercast, Pocket Casts, Downcast and all the casts.

Daily Crunch: Zoom and Pinterest go public

The Daily Crunch is TechCrunch’s roundup of our biggest and most important stories. If you’d like to get this delivered to your inbox every day at around 9am Pacific, you can subscribe here.

1. Zoom pops 81 percent in Nasdaq debut

Thursday was a big day for tech IPOs, with Zoom opening trading at $65 a share. The company’s initial public offering gave it a fully diluted market cap of roughly $16 billion.

Meanwhile, Pinterest debuted on the New York Stock Exchange at $23.75 per share.

2. Facebook now says its password leak affected ‘millions’ of Instagram users

“We discovered additional logs of Instagram passwords being stored in a readable format,” the company said. “We now estimate that this issue impacted millions of Instagram users. We will be notifying these users as we did the others.”

3. Mueller report sheds new light on how the Russians hacked the DNC and the Clinton campaign

At one point, the Russians used servers located in the U.S. to carry out the massive data exfiltration effort, the report says.

The Instagram app is seen on an iPhone on 16 March, 2017. (Photo by Jaap Arriens/NurPhoto via Getty Images)

4. Instagram hides Like counts in leaked design prototype

Hiding Like counts could reduce the herd mentality, where people just Like what’s already got tons of Likes. It could also reduce the sense of competition.

5. The consumer version of BBM is shutting down on May 31

While the consumer version of BlackBerry Messenger is shutting down, the service will still exist. In fact, BlackBerry announced a plan to open its enterprise version to general consumers.

6. Amazon launches ad-supported music service to Echo owners

Until this week, Echo owners who wanted to stream music from Amazon could either pay for an annual Prime membership in order to access Prime Music, or they could pay $3.99 per month to stream from Amazon Music Unlimited.

7. The different playbooks of D2C brands

Venture capital firms have invested over $4 billion in D2C brands since 2012, with 2018 alone accounting for over $1 billion. How are these D2C brands going to evolve and how could they sustain as businesses? (Extra Crunch membership required.)

Daily Crunch: Zoom and Pinterest go public

The Daily Crunch is TechCrunch’s roundup of our biggest and most important stories. If you’d like to get this delivered to your inbox every day at around 9am Pacific, you can subscribe here.

1. Zoom pops 81 percent in Nasdaq debut

Thursday was a big day for tech IPOs, with Zoom opening trading at $65 a share. The company’s initial public offering gave it a fully diluted market cap of roughly $16 billion.

Meanwhile, Pinterest debuted on the New York Stock Exchange at $23.75 per share.

2. Facebook now says its password leak affected ‘millions’ of Instagram users

“We discovered additional logs of Instagram passwords being stored in a readable format,” the company said. “We now estimate that this issue impacted millions of Instagram users. We will be notifying these users as we did the others.”

3. Mueller report sheds new light on how the Russians hacked the DNC and the Clinton campaign

At one point, the Russians used servers located in the U.S. to carry out the massive data exfiltration effort, the report says.

The Instagram app is seen on an iPhone on 16 March, 2017. (Photo by Jaap Arriens/NurPhoto via Getty Images)

4. Instagram hides Like counts in leaked design prototype

Hiding Like counts could reduce the herd mentality, where people just Like what’s already got tons of Likes. It could also reduce the sense of competition.

5. The consumer version of BBM is shutting down on May 31

While the consumer version of BlackBerry Messenger is shutting down, the service will still exist. In fact, BlackBerry announced a plan to open its enterprise version to general consumers.

6. Amazon launches ad-supported music service to Echo owners

Until this week, Echo owners who wanted to stream music from Amazon could either pay for an annual Prime membership in order to access Prime Music, or they could pay $3.99 per month to stream from Amazon Music Unlimited.

7. The different playbooks of D2C brands

Venture capital firms have invested over $4 billion in D2C brands since 2012, with 2018 alone accounting for over $1 billion. How are these D2C brands going to evolve and how could they sustain as businesses? (Extra Crunch membership required.)

How do you hire a great growth marketer?

Editors Note: This article is part of a series that explores the world of growth marketing for founders. If you’ve worked with an amazing growth marketing agency, nominate them to be featured in our shortlist of top growth marketing agencies in tech.

Startups often set themselves back a year by hiring the wrong growth marketer.

This post shares a framework my marketing agency uses to source and vet high-potential growth candidates.

With it, early-stage startups can identify and attract a great first growth hire.

It’ll also help you avoid unintentionally hiring candidates who lack broad competency. Some marketers master 1-2 channels, but aren’t experts at much else. When hiring your first growth marketer, you should aim for a generalist.

This post covers two key areas:

  1. How I find growth candidates.
  2. How I identify which candidates are legitimately talented.

Great marketers are often founders

One interesting way to find great marketers is to look for great potential founders.

Let me explain. Privately, most great marketers admit that their motive for getting hired was to gain a couple years’ experience they could use to start their own company.

Don’t let that scare you. Leverage it: You can sidestep the competitive landscape for marketing talent by recruiting past founders whose startups have recently failed.

Why do this? Because great founders and great growth marketers are often one and the same. They’re multi-disciplinary executors, they take ownership and they’re passionate about product.

You see, a marketing role with sufficient autonomy mimics the role of a founder: In both, you hustle to acquire users and optimize your product to retain them. You’re working across growth, brand, product and data.

As a result, struggling founders wanting a break from the startup roller coaster often find transitioning to a growth marketing role to be a natural segue.

How do we find these high-potential candidates?

Finding founders

To find past founders, you could theoretically monitor the alumni lists of incubators like Y Combinator and Techstars to see which companies never succeeded. Then you can reach out to their first-time founders.

You can also identify future founders: Browse Product Hunt and Indie Hackers for old projects that showed great marketing skill but didn’t succeed.

There are thousands of promising founders who’ve left a mark on the web. Their failure is not necessarily indicative of incompetence. My agency’s co-founders and directors, including myself, all failed at founding past companies.

How do I attract candidates?

To get potential founders interested in the day-to-day of your marketing role, offer them both breadth and autonomy:

  • Let them be involved in many things.
  • Let them be fully in charge of a few things.

Remember, recreate the experience of being a founder.

Further, vet their enthusiasm for your product, market and its product-channel fit:

  • Product and market: Do their interests line up with how your product impacts its users? For example, do they care more about connecting people through social networks, or about solving productivity problems through SaaS? And which does your product line up with?
  • Product-channel fit: Are they excited to run the acquisition channels that typically succeed in your market?

The latter is a little-understood but critically important requirement: Hire marketers who are interested in the channels your company actually needs.

Let’s illustrate this with a comparison between two hypothetical companies:

  1. A B2B enterprise SaaS app.
  2. An e-commerce company that sells mattresses.

Broadly speaking, the enterprise app will most likely succeed through the following customer acquisition channels: sales, offline networking, Facebook desktop ads and Google Search.

In contrast, the e-commerce company will most likely succeed through Instagram ads, Facebook mobile ads, Pinterest ads and Google Shopping ads.

We can narrow it even further: In practice, most companies only get one or two of their potential channels to work profitably and at scale.

Meaning, most companies have to develop deep expertise in just a couple of channels.

There are enterprise marketers who can run cold outreach campaigns on autopilot. But, many have neither the expertise nor the interest to run, say, Pinterest ads. So if you’ve determined Pinterest is a high-leverage ad channel for your business, you’d be mistaken to assume that an enterprise marketer’s cold outreach skills seamlessly translate to Pinterest ads.

Some channels take a year or longer to master. And mastering one channel doesn’t necessarily make you any better at the next. Pinterest, for example, relies on creative design. Cold email outreach relies on copywriting and account-based marketing.

(How do you identify which ad channels are most likely to work for your company? Read my Extra Crunch article for a breakdown.)

To summarize: To attract the right marketers, identify those who are interested in not only your product but also how your product is sold.

Other approaches

The founder-first approach I’ve shared is just one of many ways my agency recruits great marketers. The point is to remind you that great candidates are sometimes a small career pivot away from being your perfect hire. You don’t have to look in the typical places when your budget is tight and you want to hire someone with high, senior potential.

This is especially relevant for early-stage, bootstrapping startups.

If you have the foresight to recognize these high-potential candidates, you can hopefully hire both better and cheaper. Plus, you empower someone to level up their career.

Speaking of which, here are other ways to hire talent whose potential hasn’t been fully realized:

  • Find deep specialists (e.g. Facebook Ads experts) and offer them an opportunity to learn complementary skills with a more open-ended, strategic role. (You can help train them with my growth guide.)
  • Poach experienced junior marketers from a company in your space by offering senior roles.
  • Hire candidates from top growth marketing schools.

Vetting growth marketers

If you don’t yet have a growth candidate to vet, you can stop reading here. Bookmark this and return when you do!

Now that you have a candidate, how do you assess whether they’re legitimately talented?

At Bell Curve, we ask our most promising leads to incrementally complete three projects:

  • Create Facebook and Instagram ads to send traffic to our site. This showcases their low-level, tactical skills.
  • Walk us through a methodology for optimizing our site’s conversion rate. This showcases their process-driven approach to generating growth ideas. Process is everything.
  • Ideate and prioritize customer acquisition strategies for our company. This showcases their ability to prioritize high-leverage projects and see the big picture.

We allow a week to complete these projects. And we pay them market wage.

Here’s what we’re looking for when we assess their work.

Level 1: Basics

First — putting their work aside — we assess the dynamics of working with them. Are they:

  • Competent: Can they follow instructions and understand nuance?
  • Reliable: Will they hit deadlines without excuses?
  • Communicative: Will they proactively clarify unclear things?
  • Kind: Do they have social skills?

If they follow our instructions and do a decent job, they’re competent. If they hit our deadline, they’re probably reliable. If they ask good questions, they’re communicative.

And if we like talking to them, they’re kind.

Level 2: Capabilities

A level higher, we use these projects to assess their ability to contribute to the company:

  • Do they have a process for generating and prioritizing good ideas? 
    • Did their process result in multiple worthwhile ad and landing page ideas? We’re assessing their process more so than their output. A great process leads to generating quality ideas forever.
    • Resources are always limited. One of the most important jobs of a growth marketer is to ensure growth resources are focused on the right opportunities. I’m looking for a candidate that has a process for identifying, evaluating and prioritizing growth opportunities.
  • Can they execute on those ideas? 
    • Did they create ads and propose A/B tests thoughtfully? Did they identify the most compelling value propositions, write copy enticingly and target audiences that make sense?
    • Have they achieved mastery of 1-2 acquisition channels (ideally, the channels your company is dependent on to scale)? I don’t expect anyone to be an expert in all channels, but deep knowledge of at least a couple of channels is key for an early-stage startup making their first growth hire.

If you don’t have the in-house expertise to assess their growth skills, you can pay an experienced marketer to assess their work. It’ll cost you a couple hundred bucks, and give you peace of mind. Look on Upwork for someone, or ask a marketer at a friend’s company.

Recap

  • If you’re an early-stage company with a tight budget, there are creative ways to source high-potential growth talent.
  • Assess that talent on their product fit and market fit for your company. Do they actually want to work on the channels needed for your business to succeed?
  • Give them a week-long sample project. Assess their ability to generate ideas and prioritize them.

VCs bet on cannabis vaping, ED meds and mobile fertility clinics

Hello and welcome back to Equity, TechCrunch’s venture capital-focused podcast, where we unpack the numbers behind the headlines.

This week was a bit of a reunion with Kate and Alex on as usual, with the addition of Extra Crunch denizen extraordinaire Danny Crichton. Danny, you may recall, has been a semi-regular Equity co-host over the past year.

As Kate explains up front, Equity is out a day early this week due to the Big TechCrunch Robotics Affair in Berkeley today. We’ll be back on Friday with IPO news regarding Zoom and Pinterest and we can’t wait.

Ok, all that sorted, what did we talk about? Alex wanted to talk about some market signals that he reads as bullish. Whatever went wrong at the end of 2018 has healed over he thinks because there have been a whole lot of supergiant venture capital rounds and some other stuff.

Next, we gave an example of one of those supergiant rounds in the works. The reported Pax round, which could put $400 million into the cannabis vaping company, intrigues us, especially because Pax is the corporate sibling of JUUL, the now-famous e-cigarette company what sold just over a third of itself for nearly $13 billion last year. A truly staggering deal.

Then we turned to Brex, the fintech startup that was back in the news this week. Why? Because it raised a $100 million debt round as startups of that sort do. Brex provides a credit card made specifically for startups that require no personal-guarantee. Yeah, risky, we know. We talked about that risk and Brex’s plan to target Fortune 500 business in the future.

Rounds for Ro, Kindbody and Carrot Fertility made it a busy week for healthtech, too. Ro is raising at a $500 million valuation to support its three digital health brands: Roman, Rory and Zero. Meanwhile, a pair of fertility startups, Kindbody and Carrot, brought in $15 million and $11 million, respectively.

With Danny back on the show, we extended our reach and discussed the latest in the chip and sensor world. NXP, fresh off a failed, multi-billion dollar exit to Qualcomm put money into Hawkeye Technology, a China-based company working in the car sensor space. Equity’s regular hosts mostly nodded as Danny dropped a lot of knowledge.

All that and we had some fun. We’ll be back before you know it.

Equity drops every Friday at 6:00 am PT, so subscribe to us on Apple PodcastsOvercast, Pocket Casts, Downcast and all the casts.

Pinterest prices IPO above range

Pinterest priced shares of its stock, “PINS,” above its anticipated range on Wednesday evening, CNBC reports. The company will sell 75 million shares of Class A common stock at $19 apiece in an offering that will attract $1.4 billion in new capital for the visual search engine.

The NYSE-listed business had planned to sell its shares at between $15 to $17 and didn’t increase the size of its planned offering prior to Wednesday’s pricing.

Valued at $12.3 billion in 2017, the initial public offering gives Pinterest an initial market cap of approximately $10 billion.

The IPO has been a long time coming for the nearly 10-year-old company led by co-founder and chief executive officer Ben Silbermann . Given Wall Street’s lackluster demand for ride-hailing company Lyft, another consumer technology stock that recently made its Nasdaq debut, it’s unclear just how well Pinterest will perform in the days, weeks, months and years to come. Pinterest is unprofitable like its fellow unicorns Lyft and Uber, but its financials, disclosed in its IPO prospectus, illustrate a clear path to profitability. As for Lyft and Uber, Wall Street analysts, among others, still question whether either of the businesses will ever achieve profitability.

Eric Kim of consumer tech investment firm Goodwater Capital says despite the fact that Pinterest and Lyft are very different companies, Lyft’s falling stock has undoubtedly impacted Pinterest’s offering.

“They are so close together, it’s hard for those not to influence one another,” Kim told TechCrunch. “It’s a much different category, but they are still both consumer tech and they will both be trading at a double-digital revenue multiple.

The San Francisco-based company posted revenue of $755.9 million in the year ending December 31, 2018 — 16 times less than its latest decacorn valuation — on losses of $62.9 million. That’s up from $472.8 million in revenue in 2017 on losses of $130 million.

The stock offering represents a big liquidity event for a handful of investors. Pinterest had raised a modest $1.47 billion in equity funding from Bessemer Venture Partners, which holds a 13.1 percent pre-IPO stake, FirstMark Capital (9.8 percent), Andreessen Horowitz (9.6 percent), Fidelity Investments (7.1 percent) and Valiant Capital Partners (6 percent). Bessemer’s stake is worth upwards of $1 billion. FirstMark and a16z’s shares will be worth more than $700 million each.

Zoom — another tech company going public on Thursday that, unlike its peers, is actually profitable — priced its shares on Wednesday too after increasing the price range of its IPO earlier this week. The price values Zoom at roughly $9 billion, nearly surpassing Pinterest, an impressive feat considering Zoom was last valued at $1 billion in 2017 around when Pinterest’s Series H valued it at a whopping $12.3 billion.

Profitability, as it turns out, may mean more to Wall Street than Silicon Valley thinks.

Zoom, the profitable tech unicorn, prices IPO above range

Zoom, a relatively under-the-radar tech unicorn, has defied expectations with its initial public offering. The video conferencing business priced its IPO above its planned range on Wednesday, confirming plans to sell shares of its Nasdaq stock, titled “ZM,” at $36 apiece, CNBC reports.

The company initially planned to price its shares at between $28 and $32 per share, but following big demand for a piece of a profitable tech business, Zoom increased expectations, announcing plans to sell shares at between $33 and $35 apiece.

The offering gives Zoom an initial market cap of roughly $9 billion, or nine times that of its most recent private market valuation.

Zoom plans to sell 9,911,434 shares of Class A common stock in the listing, to bring in about $350 million in new capital.

If you haven’t had the chance to dive into Zoom’s IPO prospectus, here’s a quick run-down of its financials:

  • Zoom raised a total of $145 million from venture capitalists before filing to go public
  • It posted $330 million in revenue in the year ending January 31, 2019 with a gross profit of $269.5 million
  • It more than doubled revenues from 2017 to 2018, ending 2017 with $60.8 million in revenue and 2018 with $151.5 million
  • Its losses have shrunk from $14 million in 2017, $8.2 million in 2018 and just $7.5 million in the year ending January 2019

Zoom is backed by Emergence Capital, which owns a 12.2 percent pre-IPO stake; Sequoia Capital (11.1 percent); Digital Mobile Venture, a fund affiliated with former Zoom board member Samuel Chen (8.5 percent); and Bucantini Enterprises Limited (5.9 percent), a fund owned by Chinese billionaire Li Ka-shing.

Zoom will debut on the Nasdaq the same day Pinterest will go public on the NYSE. Pinterest, for its part, has priced its shares above its planned range, per The Wall Street Journal.

Startups Weekly: Lessons from a failed founder

I sat down with Menlo Ventures partner Shawn Carolan this week to talk about his early investment in Uber. Menlo, if you remember, led Uber’s Series B and has made a hefty sum over the year selling shares in the ride-hailing company. I’ll have more on that later; for now, I want to share some of the insights Carolan had on his experience ditching venture capital to become a founder.

Around when Menlo made its first investment in Uber, Carolan began taking a step back from the firm and building Handle, a startup that built tools to help people be more productive. Despite years of hard work, Handle was ultimately a failure. Carolan said he shed a lot of tears over its demise, but used the experience to connect more intimately with founders and to offer them more candid, authentic advice.

“People in the valley are always achievement-oriented; it’s always about the next thing and crushing it and whatever,” Carolan told TechCrunch. “When [Handle] shut down, I had this spreadsheet of all the people who I felt like I disappointed: Seed investors who invested in me, all the people at Menlo and my friends who had tweeted out early stuff. It was a long spreadsheet of like 60 people. And when I started a sabbatical, what I said was I’m going to go connect with everyone and apologize.”

Today, Carolan encourages founders to own their vulnerabilities.

“It’s OK to admit when you’re wrong,” he said. “Now I can see it on [founders’] faces, I can see when they’re scared. And they’re not going to say they’re scared but I know it’s tough. This is one of the toughest things that you’re going to go through. Now I can be there emotionally for these founders and I can say ‘here’s how you do it, here’s how you talk to your team and here’s what you share.’ A lot of founders feel like they have to do this alone and that’s why you have to get comfortable with your vulnerability.”

After Handle shuttered, Carolan returned to Menlo full time and made the firm a boatload of money from Roku’s IPO and now Uber’s. Anyway, thought those were some nice anecdotes that should be shared since most of our feeds are dominated by Silicon Valley hustle porn.

Want more TechCrunch newsletters? Sign up here. Ok, on to other news…

IPO corner

Funds on funds on funds

There were so many fund announcements this week; here’s a quick list.

Extra Crunch

Lots of great new exclusive content for our Extra Crunch subscribers is on the site, including this deep dive into the challenges of transportation startup profits. Plus: When to ditch a nightmare customer, before they kill your startup; The right way to do AI in security; and The definitive Niantic reading guide.

Lawsuits

Sinema, that one MoviePass competitor, has run into its fair share of bumps in the road. TechCrunch’s Brian Heater hopped on the phone with the startup’s CEO this week to learn more about those bumps, why its terminating accounts en masse, a class-action lawsuit its battling and more.

Photo by Stephen McCarthy / RISE via Sportsfile

Startup capital

Battlefield!

TechCrunch’s Startup Battlefield brings the world’s top early-stage startups together on one stage to compete for non-dilutive prize money, and the attention of media and investors worldwide. Here’s a quick update on some of our BF winners and finalists:

#Equitypod

If you enjoy this newsletter, be sure to check out TechCrunch’s venture-focused podcast, Equity. In this week’s episode, available here, Crunchbase News editor-in-chief Alex Wilhelm, myself and Phil Libin, the founder of Evernote and AllTurtles, chat about the importance of IPOs. Plus, in a special Equity Shot, Alex and I unpack the Uber S-1.