Last Friday, ViaCell (NASDAQ:VIAC), the company that harvests and indefinitely stores blood from newborns' umbilical cords for later medical use, went public on the Nasdaq. In the middle of earnings season, many people probably didn't notice how this initial public offering went down. Well, for the number it picked, I'd like to (incongruously, perhaps) quote actress Julia Roberts in Pretty Woman: "Big mistake. Huge."

Earlier this month, we took a look at this company and its ultra-clever business model, which combines the promise of saving lives with the genius of charging storage fees for cord blood collected by its ViaCord subsidiary, in the style of such subscription-based companies as Tivo (NASDAQ:TIVO), Sirius (NASDAQ:SIRI), XM Satellite (NASDAQ:XMSR), and the like. Sadly, the genius of the model didn't translate into a well-considered coming-out party.

As recently as January 3, ViaCell was mulling the possibility of going public at anywhere from $7 to $9 per share. Where the company went wrong on Friday was in choosing the lower of those two numbers. It appears that the company and/or its underwriters, UBS (NYSE:UBS) and Credit Suisse Group (NYSE:CSR), gravely underestimated investor demand for this issue in pricing it at a measly $7 per share, a number that values the entire business at just over $260 million. Today, just two trading days after the company went public, its shares are already trading abovethe top of the initial IPO pricing range -- $9.12 per stub, in fact.

Yahoo! Finance hasn't quite figured out a current market cap for the company just yet. But a rough calculation, based on the 7.5 million shares already floated, and their making up about 20% of all shares outstanding, puts the company's current market cap at about $342 million -- $82 million more than the offer price. Essentially, ViaCell undervalued itself by about 23%, leaving $16 million on the table in the process. Pocket change, you say? Hardly worth getting upset about? Well, given that this company is in the business of saving lives, of curing the diseases of its customers, and perhaps those of relatives and even of people completely unrelated to its customers, it really is a big deal. Especially when you consider that there's no assurance that unprofitable ViaCell will remain in business long enough to fulfill its mission.

That $16 million, lost to the company's coffers forever, would have been enough to finance more than half a year's worth of its continuing net losses. That's a crying shame. And the fact that investors who bought ViaCell's underpriced shares at the IPO are already up 30% in just two days doesn't change that a whit.

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Fool contributor Rich Smith owns no shares in any company mentioned in this article.