Saturday, October 5, 2013

$One billion IPOS for Twitter, but they don't make money?

22 comments:

Randall said...

Based on past history the market does not respond well to social media IPO's (FB, Groupon, Zynga). I think this IPO has flop written all over it.

Smitha said...

I fail to understand why so many articles compare Facebook with Twitter. They both serve different purposes to me. Facebook records various milestones in life, for me! While twitter is more like 'present' communicator. I wouldn't replace one for another....

Unknown said...

Twitter seems to be taking the right steps to avoid the same fate as Facebook, but if I were an investor I'd still be hesitant.

Jacob Warren said...

Users are key, but revenue is imperative. Just like FB, I'm not certain exactly how they expect to generate long term sustainable revenue. Perhaps, mobile ads will be their saving grace. One things for sure, however, once they go public they will have to answer to Wall Street!

Unknown said...

I don't see Facebook or other social media as a threat or risk to Twitter. The ability to be in the "moment" as events are happening and shaare comments is a special feature of Twitter. It is a step forward in the right direction for Twitter not to follow in the footsteps of Facebook hype when going public. Perhaps Twitter will be more successful in making their $1B goal.

Yuxin Xu said...

The competitive advantage of Twitter is efficiency of communication and rapid response to updated news. To make use of its scale of users, Twitter should find ways to be involved more in big news and lead the change. Besides, since two third of users are not in the US, developing the international advertisement market is worth considering.

Daniel Wiemeyer said...

Twitter is currently experiencing similar issues as Facebook has had in monetizing it’s free social media site. The Wall Street Journal published an article last week about how Twitter is expanding its marketing services to television providers. The television providers however, have been hesitant to adapt to these new services due to their past use of the free hash-tag platform. (see article http://online.wsj.com/article/SB10001424127887324807704579088231837484594.html?mod=WSJ_article_comments#articleTabs%3Darticle) I believe Twitter will have a difficult time charging for its promotional services when companies have been utilizing it's free services for the past few years.

Jared Lohmann said...

A company doesn't need to be profitable to go public. IPO valuations are based upon projected future revenues and viability. Companies that lose money are given capital all the time. Tesla went public in 2010 and only became profitable earlier this year.

Jackie Banks said...

I think Twitter will do just find, too bad we can't buy at it IPO, stocks are generally undervalued at their initial offering and therefore will become worth a lot more. Even with the mistakes Facebook made, they are recovering nicely

Matt Schulte said...

Investors seem to be willing to spend money on unprofitable or marginally profitable technologies. I can't blame Twitter, if I were them I would want to cash in on their success before something new comes along (and judging by history, something new will come along, and fast).

Unknown said...

I would be a little nervous before investing in Twitter but I have never used Twitter before. I am not really sure how Twitter makes money or if it could ever make enough to be profitable.

Chris Lewis said...

I have yet to understand the usefulness of Twitter. I see it as Facebook status updates, but without the rest of the content. As an investment opportunity, I could not see myself giving this company a dime. I'm not convinced that Twitter can ever become profitable.

Patricia Doyle said...

I would be worried that Twitter might become the next Myspace. It seems like trends cycle faster as technology improves.

Unknown said...

Hey, you can't blame the early (pre-IPO) investors for wanting to sell. At least Jack Dorsey's other start-up, Square, can make money.

Keyan Cheng said...

Twitter's revenue and number of users have kept increasing at a steady pace. i assume the stubborn loss may be contributed by the huge increase number of employees, the loss one year before is acturally smaller.
it also important to know its mobile ad revenue best facebook and linkedin, which made them very attractive. As the first and leading miroblog in the U.S. i believe they will maintain their advantage and become profitable soon.

Bryce said...

Well, Twitter seems to have done the marketing research correct at least for de-hyping its IPO. Now they just need to figure out how to market their product profitably.

Ken Tysick said...

Before I invested in Twitter or paid for advertising space, I would want to know how many of the registered users (~218 million) actually log in and see the ads versus those users that access Twitter through third party applications and never actually see the advertising.

Laurie said...

More power to them. I hope the first press on it goes better than FB. Couldn't talk me into buying in to a company that can't turn a profit, yet calls itself a billion dollar company. Call me old fashioned, but I only want stuff that shows it has some history of making money.

Unknown said...

As a non Twitter user, I'm unfamiliar with how the platform works and especially how it makes money, but I do agree that it doesn't take a profitable company to attract investors. Facebook did it, although with some backlash - maybe Twitter can follow suit.

JS said...

Similar to Wikipedia, Twitter is very valuable to businesses and the overall economy.

They could probably become profitable by charging for official use by companies, celebrities, etc.

As an investor, I would be cautious, but if I'm invested in other companies that derive benefits from Twitter-use, I would probably invest to support my portfolio.

Unknown said...

I agree with Thomas. Twitter seems to be doing the right things to ensure they are not over-valued like other companies similar to them. Although Twitter is not directly the same as FaceBook, they do have similarities, so investors should still be hesitant before deciding to purchase.

Unknown said...

as one of the preeminent social media vehicles in the world, i am confident that twitter will be profitable at some point thanks to advertising