{"id":1560,"date":"2019-04-10T14:52:34","date_gmt":"2019-04-10T12:52:34","guid":{"rendered":"https:\/\/www.dazzlepop.net\/site\/?p=1560"},"modified":"2019-04-09T14:55:32","modified_gmt":"2019-04-09T12:55:32","slug":"pinterest-dials-down-expectations-as-i-p-o-nears","status":"publish","type":"post","link":"https:\/\/www.dazzlepop.net\/site\/pinterest-dials-down-expectations-as-i-p-o-nears\/","title":{"rendered":"Pinterest Dials Down Expectations as I.P.O. Nears"},"content":{"rendered":"
<\/div>

Ben Silbermann, chief executive of Pinterest, at the company\u2019s San Francisco office in August.<\/span>Credit<\/span>Credit<\/span>Anastasiia Sapon for The New York Times<\/span><\/p>\n

SAN FRANCISCO \u2014 Pinterest set a price range for its initial public offering that will value the company below its last private-market peg of $12 billion, raising questions about investor demand for prominent but unprofitable technology companies that are stampeding toward the stock market.<\/p>\n

In an updated prospectus<\/a>\u00a0on Monday, Pinterest said it planned to price its offering at $15 to $17 a share. At the high end of that range, the digital pin board company would be valued at about $11.3 billion, accounting for stock options and restricted stock. The business was first valued at $12 billion in 2015, and again in 2017, by venture capitalists and other private investors.<\/p>\n

Pinterest\u2019s price range dampens some of the fervor over a wave of tech offerings this year, which had promised to generate piles of new wealth in Silicon Valley. It follows\u00a0last month\u2019s I.P.O. of Lyft<\/a>, the ride-hailing company, which is deeply unprofitable. While the offering created a great deal of hype and Lyft\u2019s shares rose on their first day of trading, the stock fell below its offering price\u00a0on its second day<\/a>\u00a0of trading, as it faced questions about its business.<\/p>\n

\u201cPeople are looking at Lyft and realizing that even if the road show goes extremely well and there is a lot of demand, you can\u2019t overprice the offering,\u201d said Elliot Lutzker, corporate and securities partner at Davidoff Hutcher & Citron.<\/p>\n

He added that investors were looking more at business fundamentals. \u201cNot every company is an Amazon that can afford to lose money for years and years while growing,\u201d he said.<\/p>\n

How Lyft and Pinterest perform in their public debuts will be critical in the lead-up to the\u00a0public offering of Uber,<\/a>\u00a0the largest of this generation of tech start-ups. Uber is expected to go public in the next few months at a valuation of around $120 billion, in what would be the biggest I.P.O. by an American company.<\/p>\n

Several other smaller companies are also planning public offerings, including Zoom, a video conferencing company; PagerDuty, a software company; and Slack, an office communications company.<\/p>\n

Pinterest\u2019s filing on Monday coincided with the beginning of the company\u2019s so-called road show, during which it plans to pitch institutional investors before the company\u2019s final I.P.O. pricing and first day of trading. High demand from investors over the next several days could lead the company to raise the price of its shares.<\/p>\n

\n

At the midpoint of its price range, the company would raise around $1.2 billion from public market investors. Pinterest also has $628 million in cash on its balance sheet.<\/p>\n

If Pinterest goes public below its last private market valuation, that will not be a first for this generation of highly valued start-ups. Box, a cloud storage company, went public in 2015 at $1.6 billion, below its $2.4 billion private market valuation. The company now trades at a $2.8 billion market capitalization. Square, a payments company that was worth $6 billion in the private market, went public in 2015 at a\u00a0$2.9 billion<\/a>\u00a0valuation. Square now has a $31 billion market capitalization.<\/p>\n

In total, private investors have poured about $1.5 billion into Pinterest. A market debut below $12 billion could spell a loss for the ones that invested most recently.<\/p>\n

But the company\u2019s earlier investors will still see huge paydays. In its updated prospectus, Pinterest revealed the ownership stakes of its biggest shareholders, which include the venture capital firms Bessemer Venture Partners, FirstMark Capital and Andreessen Horowitz. At the midpoint of the proposed I.P.O. price range, Bessemer\u2019s stake would be worth $952 million, FirstMark\u2019s would be worth $710 million, and Andreessen\u2019s would be $696 million.<\/p>\n

The biggest individual shareholder is Ben Silbermann, Pinterest\u2019s 36-year-old chief executive and co-founder. He owns 11.4 percent of Pinterest\u2019s shares, making his stake worth $825 million at the midpoint of the pricing range. Evan Sharp, 36, another co-founder and the chief design and creative officer, owns 2.1 percent of the company.<\/p>\n

Pinterest, which makes digital pin boards that allow people to save images and links from around the web, took off around 2011. Pinners, as users are known, create collagelike mood boards on topics like food, events and hobbies. Mr. Silbermann, who has taken a\u00a0conservative\u00a0<\/a>approach to spending and growth, sought to build the company slowly. In 2014, Pinterest began selling ads.<\/p>\n

Mr. Silbermann\u2019s methods contrasted with those of other entrepreneurs who lead companies known as unicorns, which are valued at more than $1 billion by private investors. Such companies have typically put a priority on fast growth over profits and take many years to go public. Unicorns that sell or go public below their last private valuation are known as undercorns.<\/p>\n

Like its peers, Pinterest loses money. But the company, which generates revenue from advertising, is\u00a0burning less cash than Lyft or Uber<\/a>. Last month, Pinterest revealed it lost $63 million on revenue of $756 million in 2018. Pinterest is also growing quickly, reporting a 60 percent jump in revenue from 2017 to 2018.<\/p>\n

The company plans to list its shares on the New York Stock Exchange under the symbol PINS.<\/p>\n<\/div>\n

 <\/p>\n

 <\/p>\n

Source:\u00a0https:\/\/www.nytimes.com\/2019\/04\/07\/technology\/pinterest-ipo.html<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

Ben Silbermann, chief executive of Pinterest, at the company\u2019s San Francisco office in August.CreditCreditAnastasiia Sapon for The New York Times SAN FRANCISCO \u2014 Pinterest set a price range for its initial public offering that will value the company below its last private-market peg of $12 billion, raising questions about investor demand for prominent but unprofitable […]<\/p>\n","protected":false},"author":3,"featured_media":-1,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_vp_format_video_url":"","_vp_image_focal_point":[],"footnotes":""},"categories":[48],"tags":[31,7,98,37],"class_list":["post-1560","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-technology","tag-business","tag-e-marketing","tag-pinterest","tag-technology"],"yoast_head":"\nDazzlepop | Pinterest Dials Down Expectations as I.P.O. 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