The Financial Times recently reported that several Twitter employees will be selling their stock in the social network to the BlackRock group. The valuation of the company is at $9 billion, up by 10% since the last analysis.
BlackRock will buy some Twitter stock for $80 million and gain a part of the company in stock and shares. Twitter hasn’t announce any IPO, and we don’t suspect they will come out with one any time soon, considering the poor success of Groupon, Zynga and Facebook.
In our view, Twitter’s leaders are quite happy to keep gaining investment from companies and this early stock selling shows they don’t want an IPO soon. We believe they may build up a good portfolio of companies that have shares, before going public.
$9 billion valuation is pretty impressive, considering Twitter haven’t used any normal ways of advertising. There is no banners or advertisement space on Twitter, although they have allowed sponsored links and hashtags.
This seems to be settling the social network, in terms of revenue. Those servers don’t pay themselves, and we suspect we all know that. With Wikipedia asking for pledges every month, you can see the appeal of advertisement in some shape or form.
Twitter’s main rival, Facebook, is currently valued at $68 billion, despite a poor IPO. The social network has over 1 billion users and currently has a lot of active usage. Advertisers seem adamant that Facebook ads work and continue to pledge money.
Twitter has a smaller ad revenue but the stats are growing in their favour. Users are a lot more active on Twitter, especially in “hashtaggable” times. Currently Twitter has around 250 million users, we believe.