Twitter Raising Gagggle Of Green, Still Has 100 Pound Gorilla In The Room
- Twitter is about to raise a ton of new cash. Last week there was news that Twitter is raising another round of funding at a $1 billion valuation. Twitter was trying to raise only $50 million, but demand for its shares is so great that it is raising even more.
- The WSJ is reporting that the round may close as early as later today and the new investors are Insight Venture Partner along with other new investor, T. Rowe Price. Just six months ago, Twitter raised $35 million at a $250 million valuation. The new round is for $100 million and values Twitter at $1 billion. The real question is what the term sheet looks like. The new investors will probably be the last until the company decides to go public (not sure how that would happen), or get acquired.
- From what I’m hearing, Insight and T. Rowe will only accept a minimum 20x return on their money. Twitter better keep the growth coming and figure out that revenue model soon otherwise there could be some issues for the founders. I once thought that Twitter might be worth the money when they said they were going to be competing in the search game by monetizing real-time results. Not anymore. In the past 2 months with Twitter’s popularity growing wild, real-time search has become less and less useful with spam completely ruining the experience. Forget about trending topics anymore, those are littered with coupon deals, shameless individuals trying to gain followers, and people just putting trending tags in their updates for visibility. There second chance in my opinion is when Twitter rolls out their new location based stuff this week. We’ll see how the local business community takes to it by jumping in on the local-ad band wagon that FourSqaure seems to be doing pretty well with so far (At least Union Square is an investor on both). I think Twitter should by them before they get too popular.