Zoom Technologies dropped 77% today. What happened?
When looking at the stock chart this morning this was a shock. How can zoom rise from 0.40 USD a month ago to 6.00 USD yesterday and then fall so strong? And all of this pre-IPO.
Easily answered: This is the chart of Zoom Technologies Inc. and not Zoom Video Communications Inc., the company well known in the startup world for videoconferencing services and more. The stock of Zoom Video Communications Inc. today looks like this of course since the company will go public tomorrow:
Any stockholder of the Zoom Technologies stocks will be happy to have seen a 1400% rise within a month of his stock only due to buyers who did not really focus on the name of stocks they are buying.
Anyone interested in the stock of Zoom Video Communications - that will be traded tomorrow and obviously there is quite a run to buy. The company raised the top of the stock price from 32 to 35 yesterday bringing it to a top market valuation of 9 billion USD. That’s because it is one of the rare startup unicorns being profitable and growing at a good pace in revenue and profit.
Congratulations to Sequoia Capitals Carl Eschenbach and Patrick Grady who invested in Zoom in 2017 and will have generated a 9x multiple for their 11% investment at the day of the initial offering. Even more all respect to Jerry Yang, the founder of Yahoo, who with his AME Cloud Ventures invested early in 2015 at a valuation at around 100 million USD.