Shares of VC-backed Vonage Holdings Corp. (Nasdaq: VG) dropped more than 12% in its first full day of trading last week. The company raised about $531 million in its IPO by selling 31.25 million common shares at $17 per share. But at the close of trading on May 24, the stock was at $14.85 per share. It was the weakest first-day performance since Lumera Corp. lost 13.5% of its value in July 2004.
Vonage, a provider of VoIP services, was founded in 2001 and is active in the United States, Canada and United Kingdom. It has never shown a profit and is spending heavily on marketing to acquire new subscribers.
Vonage has raised about $396 million in total VC funding from such firms as Bain Capital, Meritech Capital Partners, New Enterprise Associates, 3i Group and Institutional Venture Partners. Its VC funding includes a $200 million Series E deal in 2005 at a post-money valuation of $915 million.
The IPO values Vonage at about $2.65 billion.
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