In the first tech IPO since the coronavirus shut down much of the U.S. economy, ZoomInfo soared more than 80% in its Nasdaq debut Thursday, underscoring investors’ ongoing appetite for high-growth subscription software companies…
ZoomInfo, not to be confused with video chat provider Zoom Video, priced its IPO at $21 on Wednesday after previously raising the expected range to $19 to $20. As of early afternoon New York time, the stock was trading at around $38, valuing the company at about $15 billion. The offering reeled in more than $900 million.
ZoomInfo’s technology helps corporate sales and marketing teams with customer outreach, integrating with sales software tools from Salesforce, Oracle, Microsoft and others. The company says it has more than 15,000 customers across all industries and estimates that it’s going after a $24 billion market opportunity.
Even with businesses across the country closed, unemployment skyrocketing and gross domestic product expected to plunge by more than 40% in the second quarter, cloud software companies have largely weathered the storm and, in many cases, even benefited. Twilio, ServiceNow, Okta and Coupa have all bounced back dramatically from the initial Covid-19 plunge and are now trading near record levels.
While ZoomInfo’s revenue rose by over 40% in the first quarter, the company said in its prospectus that it faces headwinds from the coronavirus in the form of “slowed growth or decline in new customer demand for our platform and lower demand from our existing customers for upgrades within our platform.” The company said it closed all of its offices because of Covid-19 and plans to keep employees working from home in the second quarter and possibly beyond.
ZoomInfo, in its current form, was created in 2019 when DiscoverOrg acquired Zoom Information and was rebranded as ZoomInfo. Henry Schuck co-founded DiscoverOrg in 2007, and became CEO of the combined entity after the transaction closed. TA Associates and Carlyle Group, which were principal investors in DiscoverOrg, are the largest shareholders in ZoomInfo.
Revenue for the combined entities increased 39% last year to $336 million and 42% in the first quarter to $103.6 million. The company recorded a first-quarter net loss of $5.9 million.
Zoom Video has been perhaps the…
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