Zillow Prices IPO Above Range; TCV’s and Benchmark’s Shares Valued at $140M Combined


(Reuters) – Real estate and housing data company Zillow Inc. priced its initial public offering of 3.5 million shares at $20 apiece, raising 18 percent more than expected through the offering. Its shares are set to start trading on Nasdaq tomorrow morning under the ticker symbol “Z.”

Zillow will raise about $70 million from the IPO, up from the $59.5 million it expected from its previous range of $16 to $18 a share.

Seattle-based Zillow raised $84.2 million over four rounds between 2005 and 2007, according to Thomson Reuters (publisher of peHUB). Its most recent round, a $27.2 million Series C in September 2007, had a post-money valuation of $402 million, Thomson Reuters reports.

Zillow’s largest venture backers are Technology Crossover Ventures (TCV), which holds 4.4 million shares of Class A common stock (or about 25% of the total); and Benchmark Capital, which owns 2.6 million shares of Class A shares (or 14.9% of the total), according to Zillow’s S-1 filing with the SEC. At $20 per share, TCV’s shares are worth about $88 million, while Benchmark’s are worth about $52 million.

Besides TCV and Benchmark, money manager PAR Investment Partners holds 1.5 million Class A shares (or 8.8% of the total).

Despite the large stock holdings of the venture firms, TCV and Benchmark hold relatively little voting power in the company. TCV has 3.9% of total voting power, while Benchmark has 2.3%, according to the S-1 filing, compared to 46.7% for Richard Barton, Zillow’s co-founder and former CEO, and 37.8% for Lloyd Frink, the company’s co-founder and president.

Zillow offers rent and house price estimates as well as real estate data on millions of U.S. homes through its websites and mobile phone applications.

It depends primarily on subscriptions from local real estate professionals for revenue, Zillow said in a regulatory filing.

Citigroup is the lead underwriter for the IPO.

(Reporting by Brenton Cordeiro, Reuters; Editing by Prem Udayabhanu, Reuters)

Additional reporting by Lawrence Aragon, peHUB