Twitter now valued at $1B with new investments

Twitter has raised a new round of financing at a $100 million dollar valuation.

Benchmark Capital, Spark Capital, Institutional Venture Partners are returning investors and were involved in the new offering. There were also two new shareholders added to the mix, T. Rowe Price and Insight Venture Partners.

The terms of the deal will not be disclosed, including neither the total amount Twitter has raised (except to say it was a significant sum) nor any indication as to the investment weights from each investor.

We just know that Twitter was valued at $1 billion after internal people familiar with the matter confirmed the valuation to the AP.

The new funds will be used to fund company operations, and could include purchasing new equipment to grow the service and even expand the current 60-strong workforce.

 Twitter previously declined a $500 million Facebook acquisition in 2008.

Twitter continues to grow exponentially, with now having more than 54 million users around the world, having just only about 4 million merely in 2008. According to Compete, Twitter had a marginal increase to 23,579,044 U.S. based users in Aug 2009, compared to only about 14 million only 6 months ago.

The 3-year-old company failed to develop a business model to this date. It is still unclear how the company would generate revenue.

Twitter founders Biz Stone and Evan Williams previously said that the primary revenue stream for Twitter would not be ads.

The company does have plans to capitalize offering corporations who use the service to promote their offerings with premium-featured accounts.

According to leaked internal documents from Twitter, the company is forecasting it would generate $150 million in total revenue by the end of 2010. It is unclear exactly from where this revenue will be generated from right now.

The value of Twitter to companies seems to be very significant.

Computer maker Dell had announced that Twitter had generated up to $1 million in revenue in 2008 as a direct result of tweeting about special promotions. Dell (@DellOutlet) now has more than 1.247 million followers on the account and could in fact be contributing to a whole lot more as Twitter rapidly grows.

The problem with Internet company’s today is to actually develop a meaningful business plan (besides relying on slumping global internet advertising revenue).

Facebook, now the third-largest website in the world with more than 300 million users, is only projecting to generate $500 million in total revenue by the end of 2009. Facebook as well is having a hard time generating sufficient revenue from advertising as the company continues to grow. Facebook’s valuation has also fluctuated materially over the past couple of years, reaching as low as $3-$4 billion and reaching as high as $15 billion in Oct 2007 when Microsoft Corp made a $240 million investment for a mere 1.6-percent stake.

Update: Correction, the article title first noted Facebook, it is Twitter.

tag TAGS: , , ,
Short URL:
b2p Ensure that you follow us on Twitter and Like us on Facebook
Tahir holds a Bachelor Commerce Finance degree from Ryerson University in Toronto. He is planning to purse an MBA in Finance. Write to [email protected]
We are perfectly committed to the highest ethical and professional codes of conduct and standards in the industry on a firm wide basis. Learn more about us, our contributors, and our governance
We encourage you to comment. Comments are moderated. Comments that are abusive, off-topic, have marginal substance, or include promotional content will be removed. We cannot facilitate requests to edit or remove comments, or explain moderation decisions

Business 2.0 Press publishes exclusive business tech news and analysis covering start-ups to large-caps from Bay & Wall streets since 2008 from a group of highly knowledgeable industry professionals that abide by the toughest industry codes of conduct and professional standards lightMore

lightAdd value by subscribing (RSS)

logo has the most stock ratios for public companies. Get the most comprehensive micro insight on public firms available on the web, all for free.
Stock Fractionsgo


Colon cancer is one of the leading causes of death. Irrespective of family history, everyone is exposed to the risk. About 90% of colon cancer cases begin from non-cancerous tumors, polyps, which could form in the large bowel. Screening with a colonoscopy will painlessly remove any polyps hence almost entirely reducing your risk of developing the horrible disease. The good news is that about 90% of colon cancer cases are preventable through a simple (yes, simple) colonoscopy.
Learn moreatom
Public service message from Business 2.0 Press