Twitter, and their business model

Steven | twitter | Saturday, 10 July 2010 - 09:17

Rumor has it Twitter is gonna communicate some information about how they’ll be making money in the future. Till today, Twitter is still 100% funded with VC. In a best practices way of looking at things this probably is the worst possible situation to be in, but Twitter can pull it off for some reasons. Main reason: Twitter being hot, any VC wants to throw in some money, because they know at best they’ll get a huge validation, at worst they can tell the market they backed Twitter, which is a unlikely but even then acceptable outcome.

In any case, because they have this position they can play it very clever. Keep the VC’s at some distant, and call the shots. In this case: don’t rush it, let the platform grow. That’s why they became so successful in the first place (again, Twitter being the exception here, a “normal” company probably couldn’t pull this off).

Here’s a recent CNBC interview on the subject with ao Gary Vaynerchuk who nails it very good imho

I wrote about the search of a business model for Twitter over a year ago, and my post still seems to stand. Duh I forgot about an IPO, but on the other hand this isn’t a lasting way of making money.
I’d like some stock though ;)

My main easy success / tactical / takeaway proposition was offer a payed option of $5 per month to access your stats (which is very easy to integrate since they already use Google Analytics), this would generate some steady easy money for them. Guess what, I’d pay for it. (Mailed it to them, never got any answer though).

Anyway, the speculations are on. Pretty curious to see what’s about to happen.


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