(Reuters) - Shares of Pinterest Inc surged almost 30 percent in their stock market debut on Thursday, valuing the online scrapbook company at around $16 billion and signaling investor appetite for new tech listings.

That bodes well for the U.S. IPO market as ride-hailing company Uber Technologies Inc prepares for its highly anticipated debut, particularly with shares in smaller rival Lyft Inc floundering below their March offering price.

“All of the gyrations that you read about in the press and the drama that you read about in other cases, we can certainly fall victim to a lot of those things if we are distracted by the news cycle or things that are short-term by nature,” Pinterest Chief Financial Officer Todd Morgenfeld said.

“But we’re focused on building the best version of Pinterest we can over the next several years.”

Pinterest shares opened at $23.75, well above the $19 they were priced at, and closed at $24.40

Zoom Video Communications Inc shares also surged in the U.S. video conferencing company’s first day of trading on Thursday, closing 72 percent above their IPO price of $36.

“It is a very favorable market at the moment,” Zoom Chief Financial Officer Kelly Steckelberg said in an interview. “Investors really see the opportunity for ‘software as a service’ companies.”

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Investors are hopeful that money-losing Pinterest, the most high-profile social media company to list in the United States since Snap Inc in 2017, will have a strong run in the market, given the company’s ability to grow revenue and increase its user base.

“When you see an initial pop in price like this it’s a pretty clear indicator interest is strong out of the gate,” said Chris Larkin, senior vice president of trading at E*TRADE Financial Corp.

‘RIGHT TRACK’

Pinterest allows users to search for topics like home improvement projects and travel tips, with results often showing handy infographics. It also lets users create themed social “boards.”

The company brings in revenue through advertisements, which are placed among the “pins” or posts that users upload on the site.

Pinterest had a net loss of $63 million on revenue of $756 million in 2018. It expects to report 291 million global monthly active users as of March 31, up 22 percent from a year earlier.

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Pinterest was showing a clear path to profitability but was overvalued, said Haran Segram, a professor of finance at New York University’s Stern School of Business.

The IPOs of Pinterest and other loss-making unicorns - startup companies with valuations of at least $1 billion - have presented a predicament for investors.

While they do not want to miss out on popular companies with fast growth, they also have to weigh the risks of businesses with unproven economics.

Pinterest’s IPO was underwritten by 12 banks led by Goldman Sachs Group Inc and JPMorgan Chase & Co.