Pinterest Inc. raised $150 million in venture funding from a group of existing investors at the same share price as two years ago as growth at the closely held company fails to keep pace with internet rivals.
The last fundraising round was in April 2015, valuing the business at about $11 billion. Because the number of shares in the company has grown over time, its new valuation is $12.3 billion, Pinterest said. The company filed securities documents associated with the financing, which were analyzed by private stock market firm Equidate and shared with Bloomberg.
By raising money, Pinterest is choosing to delay a potential initial public offering as its business model matures. The company generates revenue by selling ads that look like posts on its site. Each month, 175 million people use Pinterest to collect and post images related to fashion, travel, cooking and other interests. The San Francisco-based company is targeting revenue of more than $500 million this year, people familiar with the matter have said.
Pinterest, once one of Silicon Valley’s hottest startups, has been overshadowed by its faster-growing competitors. In the time since its last fundraising, Snap went public, Facebook-owned Instagram reached 700 million users, and Google built competitive image-based shopping technology.
Pinterest has said its growth potential depends on improving its product to match people with images that reflect their interests and inspire them. The company said it will use the funds to improve its computer vision and visual search technologies like its Lens camera search, which lets users take pictures on their phone and search for similar items or images on Pinterest. The company will also use the new capital to improve its offering for international users.