Zulily Surges After Raising $253 Million in Mom-Site IPOLeslie Picker
Zulily Inc., which runs a shopping website targeted at moms, jumped 71 percent after raising $253 million in its U.S. initial public offering, pricing the shares above an increased range.
The shares rose $15.70 to $37.70 at the close in New York. The e-commerce company and some stockholders sold 11.5 million shares for $22 apiece, after offering them for $18 to $20 each. Zulily is listed on the Nasdaq Stock Market under the symbol ZU.
“We had hoped we’d see a great market response as I spent the past two weeks talking to investors and the story was resonating,” Darrell Cavens, chief executive officer and co-founder of Zulily, said by phone from the Nasdaq. “But this is far in excess of my expectations.”
Investors have shown mixed appetite for consumer Internet stocks over the past week. Twitter Inc., the microblogging web service with 230 million monthly active users, surged 73 percent in its Nov. 7 debut, while textbook-rental site Chegg Inc. slumped 23 percent in its first day of trading Nov. 13. Unlike those two, Seattle-based Zulily recently turned a profit.
Zulily operates daily flash sales with 4,500 products from children’s and women’s apparel to kitchen accessories, according to its prospectus. Sales more than doubled to $439 million in the first nine months of the year from the same period a year earlier, the filing shows. The company may use the proceeds to buy complementary businesses or technologies, as well as for general corporate purchases.
Zulily, led by co-founders Cavens and Mark Vadon, is backed by venture-capital firms Andreessen Horowitz, Maveron LLC and August Capital. Cavens will continue to hold more than 20 percent of the voting power following the IPO, the prospectus shows, while Vadon, the chairman, will have more than 30 percent.
Goldman Sachs Group Inc., Bank of America Corp. and Citigroup Inc. managed Zulily’s IPO.