Zendesk (NYSE:ZEN), the cloud-based customer service company, saw its shares rise 40% within its first few hours of trading Thursday. After pricing at $9 per share, the stock soared to $13 by mid-morning.
The company raised about $100 million in its offering, valuing the company around $632 million. Zendesk previously raised $86 million in venture capital from investors including Benchmark, Charles River Ventures and Goldman Sachs.
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“It’s an emotional day in many different ways,” CEO Mikkel Svane told Fox Business. Zendesk “looks forward to building the next generation of business software.”
Zendesk posted an 88% rise in revenues in 2013, coming in at $72 million. The company is not profitable and lost $22.6 million last year. This compares to a loss of $32.7 million the year prior.
Zendesk says it will use the proceeds from the IPO to expand its sales organization and to “acquire complementary businesses, products, services, or technologies.”
Founded in Copenhagen in 2007, the company moved its headquarters to San Francisco in 2009. Zendesk moved because in San Francisco “you have access to talent, you have access to business,” Svane said. People “keep each other on their toes.”
As of February 2014, Zendesk had over 40,000 customer accounts. This is up from 25,000 in late 2012.
Goldman Sachs, Morgan Stanley and Credit Suisse are the lead underwriters. Zendesk listed on the New York Stock Exchange.