Real estate tech startup, Redfin, surpassed initial expectations to close the first day of trading with a price of $21.72 per share, way above its $12 to $14 expected price range. Redfin (RDFN) started its IPO at $15 and gained the Seattle-based company $138.5 million, soaring through the market cap to reach $1.73 billion, from about $770 million last year.
Redfin is a real state company that uses technology via an app to manage tasks like scheduling home tours and suggesting listings, as well as showing the locations through a visualization tool. Redfin defines itself as a “technology-powered real estate broker” and rightly so.
Since its launch in 2006, Redfin claims up to 75,000 home sales worth $40 billion. The Seattle-based company has raised $167 million in equity funding over the years. Revenue last year jumped 43% to $267.2 million from $187.3 million in 2015. The company’s net loss narrowed to $22.5 million from $30.2 million in the same period, according to Forbes.
Redfin’s CEO, Glenn Kelman, didn’t give a detailed plan for the new resources, but said they will focus on integrating technology and information to fasten the platform. “The real point of attack is when they’re looking at a house on their mobile phone and want to see it right away, how the agent is getting people into properties faster,” said Kelman in an interview to CNBC prior to the company’s IPO launch.
“That’s another big change that’s happened in the market is that it just moves so much more quickly and some of it is a competitive dynamic, some of it is now the phone buzzes and new listings sell in hours not days. We have to move that much faster.”
The future seems bright and competitive for Redfin. Amazon is also pursuing a more active role in the real estate market, according to Chicago Agent Magazine which echoes user reports that Amazon aggregated and later erased a “Hire a Realtor” function on its Home and Business Service page.