Twitter is pretty valuable, being one of the most popular social media sites on the web and now, the company are chasing the stock market by filing for an IPO.
With around 200 million users, who tweet around 400 million times a day, giving Twitter a net worth of around $10.5 billion, there’s no mistaking the fact that the social media site is one of the most popular websites around. In just 140 characters worth of messaging, the microblogging platform has taken off, earning the team behind the site an estimated $350 million in 2012 from ads on users’ timelines. Now, Twitter wants to bank on its success and is looking towards a debut on the stock exchange, allowing users, investors and anyone with the moneym to buy shares.
By definition, an IPO, or an Initial Private Offering, is when a company first sells its stock to raise funds. Twitter’s filing for an IPO means that the site is ‘going public’, by putting its shares on the exchange and will soon let anyone buy shares. Announced on the official Twitter account of Twitter themselves, saying that “We’ve confidentially submitted an S-1 to the SEC for a planned IPO. This Tweet does not constitute an offer of any securities for sale.” It’s unclear when Twitter will go up for sale on the exchange, but analysts suspect that they plan to use the funds raised to invest in future revenues, with last Monday seeing Twitter buy MoPub, a mobile publishing exchange, for around $300 million.
In the wider picture, what does Twitter’s IPO filing mean for its users? Well, given that everything Twitter is doing seems to be heading towards the idea of ‘increased revenue’, users can fully expect to see even more ways for the site to deliver ads to our timelines. Not wanting to alienate users who like the relatively ad-free layout of the site (ads are fairly unobtrusive, paid-for ‘promoted’ tweets that show up on timelines), Twitter could very well invest in new ways to get ads to our eyeballs, such ads before we access linked-to sites or, we could simply see more of those promoted tweets that we see now.
Overall, the Twitter filing suggests big things for the site, though an IPO filing didn’t work out too well for Facebook, whose price tanked last year when they entered the waters of the stock exchange, and have taken a year to reach the price offered in the original estimation. But, Twitter are in the profitable position of being able to directly target users in real time according to their interests and so they could make bank on ads and of their stock sales, above current estimations.
We’ll keep you posted once we know more.