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Twitter Files For IPO
- joering2 13y ago1.16B in funding, any ideas on profits and how much they ask to get via IPO? http://www.crunchbase.com/company/twitter http://www.crunchbase.com/company/twitter
- bolder88 13y agoprofit? What relevance has profit to tech companies?!
- hrasyid 13y agothe prospect of future profit allows them to get funding..
- aaronblohowiak 13y agoRevenue must be <$1b/year to qualify for the filing technique they used. No indication of profit, but if you know the cap on their revenue and estimate their costs based on the number of employees and what has been disclosed about their datacenters...
- coloneltcb 13y agoPer the updated article, we at least know revenues are sub $1B, as this is a requirement for being allowed to file confidentially
- jlebron2 13y agoI'm skeptical about Tech IPOs. I wonder if as many people are going to buy into the hype as they did with the Facebook IPO.
- colmvp 13y agoIsn't FB now at a high a year after its IPO?
- jonknee 13y agoThat's amazingly easy to do when your stock tanks out of the gate.
- prostoalex 13y agoI think what he's saying is that it's at all-time high, inclusive of IPO price.
- jamesaguilar 13y agoI don't know, personally I think 10% growth in the value of a mature company over a year is pretty good. I don't think it's reasonable to expect all tech companies to gain 20% on the day of the IPO. If they do, that's an indication that existing investors are reliably leaving a ton of value on the table.
- jlebron2 13y agoYeah it is, but you didn't make nearly as much money if you bought during the IPO than if you got in when the stock fell to $17-$20 range. It was highly over-valued at IPO
- tinco 13y agoI think those who held onto it when they bought the initial stock are happy with their gains. If the current price is stable or even growing, that means it was never over-valued. You are thinking too short term. If you have bought a stock at one price, and it currently has a higher price, that means you have made a good investment, regardless of what happened in between.
- jlebron2 13y agoThis is a matter of your investing preference and whether you are a buy-hold investor or a day-trader type who wants to get in at the lowest price. I simply wanted to point out I was skeptical and that FB stock tanked after IPO. I am by no means an expert on the stock market or IPOs :)
- aaronbrethorst 13y ago/shrug. My FB stock is up 80% since purchase.
- jlebron2 13y agoDon't get me wrong, I'm not bashing the stock. Simply pointing out that after IPO it tanked. But congrats on the gains!
- conanbatt 13y agoYou should be skeptical about all IPO's. They have a below avg market returns. The Intelligent investor mentions that many decades ago (maybe the 50's) IPO's were for accredited investors, because they were a known way for the saavy ones to profit from the ingenuity of the common investor. IPO's are overhyped and hence many people buy it regardless of its underlying asset, and hence drives the price up. As i mentioned before, IPO's in general have bad performances and the gain is more for the company and early stock investors that cash out, since getting into the market immediatelly gets you lots of fund/index and "silly" money.
- aganek 13y agoI love that Twitter announced it via a tweet. Good work dogfooding their own product :)
- swalsh 13y agoNice! Another shorting opportunity.
- jusben1369 13y agoHow's the FB short working out for you?
- gfodor 13y agoI realize this is pure snark, but fixating on daily price fluctuations is no way to think about a FB short thesis. It's always long term play if you're betting against the company. You're waiting for the market to come to its senses, which can take a long time.
- toomuchtodo 13y agoCue all the folks who got burned BADLY on shorting TSLA. Disclaimer: TSLA stock owner.
- jusben1369 13y agoIt was just tongue in cheek snark on snark. And short theories can be based on hour, day, week, month, quarter year. So it's not always a long term bet.
- foobarqux 13y agoShorting is never a long term play. The cost of shorting increases with time.
- RobAtticus 13y agoIt's not really a daily price thing at this point. If you shorted FB from the beginning and got out in the 20s or teens, sure you made a lot of money. But since it bottomed out (with plenty of people still calling for shorting), it rose to $31 before it started another sustained flat/downward trend. If you've had it short for the past two months, you're position is hurting quite a bit. I haven't seen a lot of evidence that a FB short is a good idea since it first IPO'd.
- pdevr 13y agoAny idea about their valuation? Facebook is now worth more or less what they claimed at the time of their IPO. Is it safe to assume this is will be around the same range (i.e., $100b)?
- ikarandeep 13y agoThe last round of funding came in at around a 10B valuation. I would expect the valuation to be much greater this time.
- muzz 13y agoNot necessarily. Zynga came public at about the same valuation as its last round, so that's not always the case. One of the criticisms of SarBox is that companies go public much later in their maturity, so public investors miss out on much of the market cap growth.
- prostoalex 13y agoStill plenty of opportunities http://goo.gl/sJnTmQ http://goo.gl/sJnTmQ
- the_economist 13y agoIt hasn't been announced but I think 10-20 billion is the expectation.
- deleted 13y ago[deleted]
- jusben1369 13y agoI heard $14 bil (on twitter)
- ganeumann 13y agoSix months ago eMarketer estimated that Twitter's 2013 revenue will be about $582 million and 2014 revenue about $1 billion (http://www.emarketer.com/Article/Twitter-Forecast-Up-After-Strong-Mobile-Showing/1009763 http://www.emarketer.com/Article/Twitter-Forecast-Up-After-S...). Facebook's market cap as I write this is $109 billion, and 2014 revenue estimates are ~$11 billion (sorry, I don't have the source for that handy), so it trades at about 10x 2014 revenue. Using this metric would value Twitter at $10 billion. But I expect that Twitter has more room to grow than Facebook since they haven't monetized as heavily yet. I'm guessing Twitter goes out at $15 billion to $20 billion. Disclaimer: I own some Twitter shares, so I'm not objective.
- tinbad 13y agoGreat, did they find a way to monetize their service yet?
- jlebron2 13y agoMainly through advertising, like "promoted tweets"
- bolder88 13y agoIs there much evidence to suggest that actually brings in value and profit though? People search google for washing machines, then click on an advert, and buy a washing machine. I can see how that works, and makes google lots of money. But a "promoted tweet", to people who are tweeting gossip, wasting time, etc? There's no intent there. They're not looking for a washing machine, they're wasting time.
- jlebron2 13y agoNot sure about the value, or how much money it brings in. According to Twitter "Promoted Tweets are ordinary Tweets purchased by advertisers who want to reach a wider group of users or to spark engagement from their existing followers." Advertisers pay Twitter to tweet, Twitter finds a specific group of people to show this tweet to.
- Oculus 13y agoThat's a very biased argument. Just as people searching for a washer on Google are more likely to click on a washer ad, people looking at the #Astronomer stream are more likely to buy a telescope. That's not the perfect comparison, but Twitter definitely classifies it's users into ad related categories.
- bolder88 13y agoYou're missing the point. You can classify all you want, but my central point was: If I'm about to buy a washing machine, I would go search on google. I would not go on twitter and tweet "OMGLOLPOP! Gonna buy a washing machine what does every1 (including advertisers) recommend #confused" So Google get me at the crucial time I'm about to buy something. Twitter don't.
- modarts 13y agoWhy?
- kybernetyk 13y agoI guess the investors are looking for a bigger idiot to buy them out.
- austenallred 13y agoSo much pessimism in the comments about the viability of Twitter as a business model. I've heard multiple sources (Chris Sacca, Ron Conway) not only say that Twitter has perhaps the best monetization opportunity of any web 2.0 company but dump as much money as they can into the stock. I've advertised on Twitter for quite a while, and the returns destroy Facebook and Adsense. Advertising makes a lot of money if the audience is big enough. Twitter's audience is huge, connected, well sorted, and interested.
- yapcguy 13y ago> dump as much money as they can into the stock They would say that wouldn't they!
- austenallred 13y agoSure, you can look at it as Ron Conway pulling a long con by investing in a stock and lying about its monetization potential. Or you can look at it as Ron Conway putting his money where his mouth is.
- bolder88 13y agoAdvertising makes money when the audience has intent. People search google for "Best washing machine". Google shows them adverts for washing machines, customer buys washing machine. Where is the intent on twitter? To gossip? I just don't see it. If someone is about to buy something, they're likely to go to google and search. They're not likely to go to twitter. Google gets them at the crucial point before they buy something.
- debt 13y agoThey have a lot of really sharp talent over there. I'm confident they can make a killer ad platform. Sign me up.
- jchonphoenix 13y agoNot to be mean, but in the dev circles in the valley, I tend to hear the exact opposite. Just what I've gathered from the rumor mill.
- debt 13y agoI'm a software engineer. I work down the street from Twitter. I hear nothing but great things about their devs.
- nomedeplume 13y agoof course because you don't want to piss off your neighbors...
- hurrycane 13y agoI always keep an eye on: http://github.com/twitter http://github.com/twitter lots of awesome stuff ranging from frontend stuff to distributed services. Having 100 open source projects and judging by the rate they are putting things out they do have a good engineering team.
- mynameishere 13y agoWhat exactly are those devs doing? I mean, aside from scaling to million and millions of users...which happened a while ago...it's pretty much the same thing as it's always been.
- andyhmltn 13y agoIf you look at their Github, they are always coming out with great stuff. They also have their name on the biggest frontend framework out there :)
- wehadfun 13y agoI hope they make a cool stock certificates. People were upset that facebook didn't do this.
- joe5150 13y ago"Confidentially" meaning they submitted all the paperwork via Snapchat, of course.
- aflam 13y agoEntertaining. Now will the blue bird fare better than the blue chips ?
- crapshoot101 13y agohttp://gigaom.com/2013/09/12/twitter-files-papers-to-go-public-at-less-than-1-billion-valuation/ http://gigaom.com/2013/09/12/twitter-files-papers-to-go-publ... - interesting; secondary valuations are in the $14-15B range per GigaOM. I'm a believer at some level.
- ulfw 13y agoDo people still actively use twitter?
- staticfish 13y agoYes.
- crazypyro 13y agoOnly millions of people everyday... Is this a real question?
- dm8 13y agoCongrats, Twitter. Another product that was mocked as a "toy" becomes revolutionary and finally going to raise money on public market. I use twitter everyday and it is my primary information network. I'm sure they will be successful!
- marssaxman 13y agoWhat do you use it for?
- prawn 13y agoSharing links with friends, discovering new content, getting news I'm interested in. (I use Twitter, but not Facebook.)
- dm8 13y agoDiscovering new content. I follow influential people in the areas that I'm interested in. And they are always sharing interesting links/insights/opinions. And I also share some!
- wpietri 13y agoMy guess is that profits will be low. And they should be. Declared profits are basically a way of saying, "We can't figure anything more useful to do with this money than put it in the bank or give it back to our investors." That's fine for a large company in a stable market. But Twitter is a young company battling to establish market share with products they hope will last for decades or centuries. [1] If the management really can't think of anything useful to do with cash, they should step down and help hire somebody who can. [1] Yes, centuries. The New York Times started publishing in 1851. It's reasonable to think that the World Wide Web will have a historical place similar to print periodicals. And network-effect businesses are notoriously hard to dislodge once widely adopted.
- nonchalance 13y agoTheir revenue is also likely low, given that they could do a confidential S-1 (there's a revenue, not a profit, limit for that type of filing)
- pjc50 13y agoThe web is _very_ churny; waves of people move from service to service over 5-10 year adoption cycles. Eventually people will declare twitter "uncool" (perhaps as a result of abuse problems?) and move onto the next thing.
- wpietri 13y agoThe modern web has been very churny, but I think we have been witnessing the equivalent of the Cambrian Explosion [1]. Eventually both tech and behavior will settle down. Some evidence for that was the rapid churn cycles in social tools from 2002-2008 or so. But Facebook, Twitter, and LinkedIn could well be where the musical-chairs game stops. [1] http://en.wikipedia.org/wiki/Cambrian_explosion http://en.wikipedia.org/wiki/Cambrian_explosion
- nichodges 13y agoAs one of the people who decides where and how brand marketing budgets are spent - I would say Twitter's advertising product and approach is far more viable and attractive than Facebook's is (or ever has been). On top of that, the work Twitter is doing with TV networks, producers, and sporting organisations is unique and has a high chance of success because it provides value to those organisations. While some have tried, nobody else has come as close as Twitter to accessing and disrupting the $180B (annual) TV advertising market. I wish them luck. I think they're going to nail it.
- unknownian 13y agoMaybe this will get buried, but as a huge fan of Twitter and the team I can't help but think they can try making more cool stuff? This huge benevolent profitable business with amazing developers has a shot at making more than a web application, I suppose. Others may say it's unfair for the big guy to cannibalize business ideas though.
- why-el 13y agoI have heard they basically no longer want to be a web company but rather a service company. This means they could have lots of interesting ideas in the works.
- Karunamon 13y agoI gotta disagree with you on "benevolent". Twitter's been mistreating their developers for quite some time now. http://developingzack.blogspot.com/2012/09/wait-what-twitter-hates-outside.html http://developingzack.blogspot.com/2012/09/wait-what-twitter... http://www.androidpolice.com/2013/02/26/falcon-pro-developer-raises-app-price-to-132-13-to-discourage-downloads-petitions-twitter-to-raise-token-limit/ http://www.androidpolice.com/2013/02/26/falcon-pro-developer...
- unknownian 13y agoYes, I've heard about the API issue. I don't really care anymore. It's wasting Twitter's money to give free access to every dev, and yet they do anyway. If they want to set limits that's their issue. The only real downside I see is that if someone wants to use a FOSS Twitter client it might be harder. Yes, I know Twitter grew because of these developers. But think about all the good Twitter does, sponsoring the Apache Foundation, not giving into the NSA, etc. They have much higher standards than most mainstream tech corps, imo.
- disgruntledphd2 13y agoWell, I suspect that most tech companies don't really want to give in to the NSA. Twitter have been better though, I do agree. However, on the sponsorship of the Apache foundation, you may wish to peruse http://www.apache.org/foundation/thanks.html http://www.apache.org/foundation/thanks.html for the list of sponsors. You'll note that Twitter are Bronze, while Goog and FB are Platinum (along with Microsoft, oddly enough).
- ebiester 13y agoIronically, I think this is both the sign to buy twitter and stop using it at the same time. I no longer trust American companies to do right by the user the moment that their stock becomes public. When wall street is banging on the door for a quarterly result, most CEOs end up listening. I'm not deleting my account just yet, but I'm wary from everything I've seen in the last decade.
- dev_jim 13y agoThis is awesome. I use Twitter everyday in a way that can't be replicated by any other service out there - there's zero competition. Once they really figure out monetization, as Facebook eventually did, it will be a home run for investors.
- chii 13y agowould you mind describing in what way(s) you use twitter?
- tn13 13y agoWell, hope that does not shoot up housing prices in SF area again.
- jmduke 13y agoI'm curious if Hacker News would have brought such pessimism to the AAPL and MSFT IPOs as they have with Facebook and Twitter. Around 500 million users, around 750 million tweets per day. That data might not be worth everything, but it's definitely worth something.
- loganfrederick 13y agoA major difference is the valuation these companies are getting. Compare Facebook's $80 billion to $100 billion to Apple's $4.8 billion IPO in today's inflation-adjusted dollars. I think that is a large part of where the cynicism is coming from. Calculated using: http://www.quora.com/What-was-Apples-valuation-at-IPO http://www.quora.com/What-was-Apples-valuation-at-IPO and http://www.usinflationcalculator.com/ http://www.usinflationcalculator.com/
- redthrowaway 13y agoAAPL IPO'd in 1980, when there were 1M personal computers in the world. Total.[1] The tech sector was just tiny compared to what it is today, and nobody predicted the WWW or the ubiquity of web-capable devices. By contrast, when FB IPO'd it had 845M users[2], or 8.3% of the world's population. The two simply aren't comparable. AAPL made niche luxury products, and FB had something close to half the potential market engaged on a daily basis. [1] http://www.corbinball.com/articles_technology/index.cfm?fuseaction=cor_av&artID=8878 http://www.corbinball.com/articles_technology/index.cfm?fuse... [2] http://en.wikipedia.org/wiki/Initial_public_offering_of_Facebook#Filing_and_roadshow http://en.wikipedia.org/wiki/Initial_public_offering_of_Face...
- loganfrederick 13y agoBut your argument can easily be used against Facebook. When you're IPOing at that late of a stage, all the gains have already gone to the private market investors. Facebook will have to come with drastic new revenue models to justify its valuation, and very few companies have reached a $100 billion valuation, let alone grown from there. And again, even if it does continue to grow financially, most of the gains have already been made. There are VCs who have made this point to lower Sarbox requirements so companies can go public earlier. I believe Ben Horowitz made a blog post on the topic, but I could not quickly find the link.
- bnuighr 13y agoSorry for my ignorance, but what's the general timeline for the IPO process? When could I start buying shares on the open market?
- RexRollman 13y agoBrace for monitization.
- chii 13y agoi forsee twitter handle squatters.
- sheri 13y agoAdvertising. Three of the largest, most influential and defining technology companies of our lifetime (Google, Facebook, Twitter) make money pretty much solely through advertising. Is there no other way companies can use this data to generate revenue other than to sell ads? I don't have anything against ads, but I'm just trying to understand how (if at all) this could change in the near future. What is the future of advertising? Will it continue to remain relevant 10 or 20 years down the line in its current form, allowing so many massive companies to be built on its back?
- zalew 13y ago> What is the future of advertising? the same as the future of capitalism. advertising will exist as long as people sell shit.
- drinkzima 13y agoIt probably makes the most sense to just look at advertising as a share of GDP or some sort of sales metric (this page indicates it has been pretty stable for the last 50+ years: http://www.niemanlab.org/2009/08/can-newspaper-publishers-survive-this-revenue-freefall-perhaps-if-they-embrace-a-digital-future/ http://www.niemanlab.org/2009/08/can-newspaper-publishers-su...). There isn't any obvious reason it would drop over time, I think the bigger question is how will advertising evolve over time.
- sheri 13y agoSomething like a Yelp or Tripadvisor seemingly has made it seem possible for restaurants (or hotels) to not advertise anymore. If you provide good food and good service, your restaurant/coffee-shop should bubble up to the top and be seen consistently by a lot of people. This is a simplistic take on the restaurant business of which I know nothing about, but at least that seems like a plausible scenario.
- nine_k 13y agoAs someone who ran a restaurant I can say that being well-known, in a prime location, and easy to google does not completely remove the need in ads, much like it doesn't remove the need to have a signboard. For a known brand ads serve as a means to say "we are here, we are alive, we do well". That's why Coca-Cola or McDonald's keep running ads, despite the fact that everyone in the world is aware of them. This is not unlike wearing an expensive necktie on public, or having a gold watch 100 years ago; it's the same sort of signaling a peacock uses his tail for. If you stop putting your ads before public's eyes, sales start to slump. Maybe this is not so for a brand with a small cult following, but such brands are few. So advertising is not going to go away, as much as luxury items market is not going to go away. It may shrink a bit when times are hard, it may migrate to different media (from paper to TV to computer screen), but not disappear.
- dweekly 13y agoWhat a Dick move.
- kaonashi 13y agoWell, there goes that.
- 6thSigma 13y agoI'm bullish on Twitter for a few reasons. I think Twitter has a unique opportunity in advertising. I'd be interested in seeing how many businesses are on Twitter and what percentage of Twitter users follow a business. I'm assuming both of those numbers are fairly high. If so, that means that a large number of users expect to see information about businesses they follow in their feed (and thus are ok with receiving marketing/business information/etc.) That in turn means ads are not viewed by a large percentage of the user base as intrusive. I think psychologically that is very important for an advertising company. In terms of the rumored market cap, all I have to say is there is no way Twitter is worth only 1/10 of Facebook. I'm not sure what Facebook is worth, but I'm sure the gap between those two companies is much closer than that. I really like the Twitter platform, and while I know they messed up by restricting their API, I think their leadership generally make good decisions.
- mrgleeco 13y agoDelivering ads could be the lesser half. Realtime sentiment analysis on Twitter's scale will explode and hyper-accelerate advertising in ways advertisers cannot yet foresee -but will surely be willing to pay for. They're just getting started.
- anmalhot 13y agotwitter presents a unique opportunity to choose the 'people' you want to follow & tailor your own feed. It's like handmade versus machine made feed. The former worth much more than the latter nowadays. I imagine if they could establish a business where people build/manage personalized feeds for others & in turn get paid - that would be fun!
- rplnt 13y agoAnother bubble appearing I see. Their user base to revenue ratio is pretty average. Their revenue by itself is not that impressive and I'm pretty sure they will be priced in tens of billions. Solely because they are visible and known.
- chris_wot 13y agoI hope they keep the prospectus to 140 characters or less.