The Web Weighs In On Twitter’s $1 Billion Valuation

    September 25, 2009

We first reported that Twitter was raising funds at a $1 billion valuation eight days ago.  Since then, the amount of money Twitter’s supposed to be raising has doubled, and more details about who’s supplying the cash have surfaced.  As you might imagine, all of this has generated quite a lot of discussion.

What are your thoughts on Twitter’s reported $1 billion valuation?  Let us know.

Twitter Logo

Below, we’ll try to provide a roundup of people’s reactions.  Fair warning: incredulous takes appear to outweigh supportive ones by a significant margin.  And also, in case you’ve missed all of the big headlines, here are the latest facts as reported by the Wall Street Journal: Twitter is raising $100 million from investors including T. Rowe Price.

As for responses, Jason Fried‘s Onion-like comeback is perhaps getting the most attention.  In a fake press release, he wrote, "37signals is now a $100 billion dollar company, according to a group of investors who have agreed to purchase 0.000000001% of the company in exchange for $1."  The piece has received more than 160 comments, most of which amount to pats on the back.

Then there’s the observation of Dan Frommer and Kamelia Angelova to consider.  In an article titled "Twitter Raises Cash Pile As Traffic Growth Slows," they noted, "During August, the company attracted 55 million unique visitors (worldwide) to, according to comScore.  That’s up about 3 million, or 6%, over July.  That’s solid, but nothing like its go-go month of April, when it grew by 13 million uniques (~70% m/m) or June, when it grew by 7 million uniques (~20% m/m)."

Still, there were some neutral and even positive remarks about the investment round.  David Carr just went for a sort of comedic approach with the following tweet:

Then Larry Dignan raised a very good point about T. Rowe Price’s involvement.  "This mutual fund firm, which I know well, isn’t exactly a run-and-gun investment house," he wrote.  "These folks play long term and tout planning for the long run."

So perhaps Twitter’s strategy to make money – which at this point, may consist of selling premium accounts and/or data analytics services, along with introducing ads – is further along than most critics thought.  Anyway, we’d be interested to hear your opinions concerning the $1 billion valuation in the comments section below.