Wayfair Gains After Online Furniture Retailer’s IPO

Wayfair Inc., the online furniture and home-goods retailer that sells brands such as Joss & Main and Birch Lane, surged in its trading debut after pricing its initial public offering above the marketed range.

The shares gained 30 percent to $37.72 at 4 p.m. in New York, giving the company a market value of $3.1 billion, after being priced at $29 in the IPO.

Founded in 2002 by Niraj Shah and Steven Conine the Boston-based company was initially run as a group of websites including bedroomfurniture.com and allbarstools.com that were eventually consolidated into Wayfair.com. The company changed its name to Wayfair from CSN Stores LLC in 2011.

Wayfair had 2.1 million active customers at the end of last year, up 61 percent from 2012, and relationships with more than 7,000 suppliers, regulatory filings show. While Wayfair posted $915.8 million in revenue in 2013 -- a 52 percent jump from the previous year -- it has yet to make a profit.

Wayfair last raised financing in March, when it garnered $157 million from an investor group led by T. Rowe Price Group Inc. The funding gave the company a valuation of $2 billion, a person familiar with the situation said at the time.

The company has two classes of stock. Class B shares, held by current insiders, are entitled to 10 votes per share, representing 98.5 percent of the voting power, the filing shows.

The company plans to use about $21 million of net proceeds toward a cash dividend for some of the co-founders, executive officers and current stockholders, according to the filing. The rest will be used for general corporate purposes and potential acquisitions.

Goldman Sachs Group Inc., Bank of America Corp. and Citigroup Inc. managed the offering.