Sunday, January 25, 2009

No Business Plan, No Revenue, No Problem

Twitter Raising New Cash At $250 Million Valuation

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It looks like everyone's favorite social networking company has raised a big slug of capital -- estimated to be at least $20 million. Proof that the old Web 2.0 strategy of build your user-base first and figure out how to make money on it later, is not dead yet. Twitter famously has virtually no revenues and no real plan at this point on how to generate any. But hey, they have a huge and growing user-base and now they have a lot more money to spend on figuring out how to generate revenues.

One other quick note, the latest financing allegedly values Twitter at $250 million. While a huge amount of money, it is still substantially less than the $500 million Twitter turned down last year from Facebook (though, admittedly, that included mostly Facebook stock).

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Dividends and Preferences by Hank Heyming is licensed under a Creative Commons Attribution 3.0 United States License.