Zoom Video Communications ("Zoom") filed to go public on March 22, 2019, seeking a $100 million IPO. Zoom is a provider of cloud-based video communication services primarily to businesses, with an aim to "make video communications frictionless." It has seen impressive growth in recent years, and is benefiting from the growth in distributed teams. Zoom's latest funding round, a $115 million Series D in early 2017, valued the company at around $1 billion. The company's S-1 filing divulged details about the company's operating metrics and revenue growth, revealing that the company has achieved profitability - a rarity for tech IPOs of late.This dashboard shows Zoom's key operating metrics, as well as our forecasts for the coming years and our valuation estimate. You can modify any of the blue dots on these charts to come up with your own forecasts and valuation estimate for Zoom.
Strong Growth In Business Customers, Revenue Likely To Continue
Total Business Customers [A]
x Average Revenue Per Business Customer [B]
Total Business Customer Revenue [C = A x B]
Zoom defines "business customers" as customers with over 10 employees. These customers generate nearly 80% of total revenue, and should see sustained growth going forward.
Zoom's Valuation Based On 2019 (Fiscal 2020) Forecasts
Zoom Revenue Multiple
Applying a revenue multiple of 12x to our revenue forecast for this year results in a valuation estimate of around $6 billion. Zoom's growth rate and profitability could justify an even higher multiple, but competition and relatively low differentiation weigh on the multiple.