Report: Twitter Secures $250 Million Valuation

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There was some excitement generated this weekend when rumor spread about Twitter nailing down a third round of venture capitalist funding, effectively raising its value to as much as $250 million.
Report: Twitter Secures $250 Million Valuation
That’s pretty good for a company that generates no revenue. Even better that Biz Stone and Evan Williams were able to do that in a notoriously tight investment market. After all, the $100 billion Facebook Web 2.0 bubble glory days are decidedly over.

Report: Twitter Secures $250 Million Valuation
Peter Kafka

TechCrunch reported Twitter’s funding success over the weekend, citing as per usual undisclosed knowledgeable sources. Peter Kafka at All Things Digital confirmed the news with (presumably different) unnamed sources on Sunday.

Besides a rough economic climate, this is especially interesting because Twitter famously walked away from a $500 million cash-and-stock-deal with Facebook last fall. That was a pretty gutsy—and some say hubris-filled—move on Twitter’s part, but it should be one Facebook founder Mark Zuckerberg should appreciate, given the way he once snubbed a billion dollar offer from Yahoo and currently still has no plans for developing a sustainable revenue model.

Report: Twitter Secures $250 Million Valuation
Kara Swisher

No revenue, huge valuation, stubborn and risky devotion to autonomy, unwillingness to get while the getting’s good: sounds like a match made in social networking heaven. Indeed, Kara Swisher thinks Facebook or another company should make another run at Twitter, and that Twitter should quiet the clanging brass before it’s left without a pair of, erm, nickels to rub together.

Swisher gives three reasons why, paraphrased below:

  1. A Facebook/Twitter deal creates the most powerful universal address book ever and pairs the two fastest-growing social networking assets on the Web.
  2. Weak economy + no revenue = no IPO in Twitter’s future.
  3. Twitter would have most autonomy with Facebook, a perk perhaps not available if (when) a larger company buys it.

Observers scoffed in disbelief when Zuckerberg had trouble making it to early-morning negotiations with Yahoo when a billion-dollar deal was on the table. It may work out for Zuckerberg eventually—even appears it is doing so currently—but the odds of a repeat in social network Russian Roulette success seem slim.

Report: Twitter Secures $250 Million Valuation
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  • http://dofollow001.com/ AndyW

    It’s the great Web 2.0 con isn’t it… successful sites that don’t make money… fortunately there are some big players (Google, Yahoo, MSN, AOL) to buy them up… hold on, Zuckerberg what have you done?! That was your only hope – give it five years and Facebook will be as trendy as the lava lamp.

    It will be interesting to see how Twitter is going to monetize itself

  • http://www.techknowl.com techknowl

    I still doubt why Twitter is not using Google Adsense or other ad services . I think it would be very easy for them to make large amount of money as they have enormous traffic .

  • http://www.donmargolis.com Don Margolis

    It reminds me of Latrell Sprewell. (a famous basketball player for you internet experts) A couple of years ago he was offered a 3 year contract extension for $21 million by the Minnesota Timberwolves. He turned it down declaring “I have a family to feed!”. Well, he let his contract run out and there were no takers for an aging player with a bad reputation. Therefore, instead of $21 million, Latrell got 0.

    Recently Latrell just had his boat repossessed.

    Will Twitter and Facebook become the Latrell Sprewells of the Web 2.0 (minus the bad reputations) Only time will tell.

  • http://www.indiesurf.com Darren Tan

    Twitter might be the next big thing.. Only time will tell.. They have great amount of traffic and if they don’t utilize it, the money would be like going into the drain.

  • http://poseidonprofit.blogspot.com Poseidon SEO, SEM, SMO

    Twitter is very popular around the globe as a result if it will be
    managed well Twitter could be the next huge step to Web 3.0…

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