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Zoom addresses CFO’s past workplace conduct ahead of IPO

Zoom, the only profitable unicorn in line to go public, priced its initial public offering at between $28 and $32 per share Monday morning. The video conferencing business plans to trade on the Nasdaq under the ticker symbol “ZM.”

Zoom, valued at $1 billion in 2017, initially filed to go public in March. According to its amended IPO filing, the company will raise up to $348.1 million by selling 10.9 million Class A shares. The offering will grant Zoom a fully diluted market value of $8.7 billion, a more than 8x increase to its latest private market valuation.

Although the company has garnered praise for its stellar financials — Zoom posted $330 million in revenue in the year ending January 31, 2019, a remarkable 2x increase year-over-year, with a gross profit of $269.5 million — the road to IPO hasn’t been without hiccups.

The company’s founder and chief executive officer Eric Yuan last night published an open letter concerning the conduct of Zoom’s chief financial officer Kelly Steckelberg. According to the letter, Zoom was recently informed by an anonymous source that Steckelberg had an “undisclosed, consensual relationship” during her tenure at a previous employer.

Steckelberg was most recently the CEO of the online dating site Zoosk; before that, she was a senior director in consumer finance at Cisco . The letter does not specify where the relationship took place, when or with whom.

Losing a CFO mere days before an IPO would have been a major loss for Zoom. CFOs often become the face of the IPO, handling the grueling tasks associated with crafting an IPO prospectus, leading the roadshow and more, while also maintaining day-to-day financial operations.

Yuan writes that the Zoom’s board of directors conducted a full investigation into the matter and determined that Steckelberg would stay on as Zoom’s CFO: “Kelly expressed regret for what transpired at her former employer, took ownership for the situation, and made clear to us that she had learned valuable lessons from the experience,” he wrote.

“We appreciated Kelly’s openness and candor during this process,” he continued. “It is clear that this matter related only to circumstances at her former employer. During Kelly’s tenure at Zoom, she has been an incredible contributor, as well as a model steward of our culture, values, and high standards since joining the Company.”

We reached out to Zoosk for comment. Zoom declined to comment further.

Zoom, expected to make the final call on its IPO price next Wednesday, will likely price at the top of the range and see a clean pop on its first day on the markets given its clean track record and positive financials. The business was founded in 2011 by Eric Yuan, an early engineer at WebEx, which sold to Cisco for $3.2 billion in 2007. Before launching Zoom, he spent four years at Cisco as its vice president of engineering.

Zoom has raised $145 million to date from investors, including Emergence Capital, which owns a 12.2 percent pre-IPO stake; Sequoia Capital (11.1 percent pre-IPO stake); Digital Mobile Venture (8.5 percent), a fund affiliated with former Zoom board member Samuel Chen; and Bucantini Enterprises Limited (5.9 percent), a fund owned by Li Ka-shing, a Chinese billionaire and among the richest people in the world.

Morgan Stanley, JP Morgan and Goldman Sachs are leading its offering.

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Zoosk relaunches dating app Lively as a way to meet new people while playing trivia games

Hoping to capitalize on the popularity of trivia applications like HQ Trivia, dating app maker Zoosk has just released an experimental app that combines trivia with the potential for meeting someone new. The app is a relaunch and complete makeover of Zoosk’s Lively, which first debuted in July 2016 as a dating app that used video to tell stories, instead of static profile images.

The new version of Lively is nothing like its former namesake.

As Zoosk explains, the previous version of Lively’s group video chat app was fun, but people didn’t know how to connect and relate to one another using the video format. It felt awkward to start conversations, with no reason to be there besides wanting to date.

The company went back to the drawing board, so to speak, to think about what sort of experiences could bring people together. Trivia, naturally, came to mind.

Lively aims to reproduce the feeling that comes with competing at a bar trivia night. When you join, you’re placed in a group video chat team of two to four people. Together, the team works to answer a series of 12 questions while discussing the answers over video in real-time. When they finish the questions, they’ll be able to see how their scores compared with other teams.

The “dating” component to the app isn’t quite what you would expect. In fact, it’s less of a way to find a date for a night out, than it is to just make new friends. After the game wraps, you’ll have the option to continue chatting with the other players, if you choose. You can also add people as a friend, if you hit it off.

And when trivia isn’t in session – the games run twice daily at 3 PM and 7 PM PST – you can group video chat with others on Lively.

Because you’re not added to a team with nearby players, your ability to make friends who are also possible real-life dating prospects is decidedly limited. That’s something that Lively could change to support in time, if it’s able to grow its user base. But for now, it needs to match users with any live players in order to fill out its teams.

It’s understandable why it went this route, but it doesn’t lend itself well to meeting someone special – unless you’re open to meeting people anywhere (which some are), or are fine with just making new friends and seeing where that leads.

Unlike HQ Trivia, which features live streams with a host, Lively is just group video chat with a trivia component. That means it won’t be as challenging for Zoosk to operate, as it doesn’t have to worry with bandwidth issues and other costs of putting on a live game show. Also, because there are no prizes or payouts, you can join anytime during the 30-minute gaming session to be placed into a team and play along.

Lively is not the first app to support a group video chat interface where gameplay is an option. A number of video chat apps over the years have integrated games into their experience, including older apps like Tango or Google+ Hangouts, Line, and more recently, Facebook Messenger. But none have integrated games for the purpose of facilitating new relationships.

Zoosk today has 38 million members, but wanted to find a way to reach a younger demographic, which is why it originally launched Lively. The app was the first product to emerge from Zoosk’s in-house incubator, Zoosk Labs, where the company experiments with new ideas to expand its core business.

Whether or not Zoosk can turn trivia players into love connections remains to be seen, but it’s interesting how HQ Trivia’s success has led to this wider market full of knock-offs (e.g. Genius, Joyride, Cash Show, The Q, TopBuzz, Live Quiz, Live.me, Halftime Live!, Jam Music, etc.) and other tweaks that follow its idea of live trivia games.

Lively is available on iOS only for now.

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Dating apps are embracing video

 Dating apps are, in their own way, a form of social networking – especially as they expand into new areas like friend-finding or professional networking. So it only makes sense that they would adopt video as well, given the growing popularity of the format on social apps like Facebook, Instagram and Snapchat, as well as the industry’s larger embrace of “Stories” as a… Read More

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Dating Service Zoosk Lays Off 15% Of Staff, Company Confirms

zoosk-logo Dating service Zoosk has laid off 15 percent of its employees this week, sources told TechCrunch, and the company now confirms. According to a spokesperson, the move was made as part of a larger effort to lower expenses in many areas. News of the layoffs follows the exit of Zoosk’s founders from their leadership roles last month, and confirmation that the company was indefinitely… Read More

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Dating Platform Zoosk Ditches IPO Plan As Founders Exit Leadership Roles

zoosk-headshots Zoosk, the online dating platform that has been around since 2007, has today announced changes to leadership, with CFO Kelly Steckelberg taking over as CEO. She will be replacing co-founder Shayan Zadeh, who is becoming a member of the board, and his co-founder Alex Mehr (currently president) will also be moving into a board position. Read More

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