The next wave of investors have swooped in to have a part in the tremendous growth of Twitter as venture capitalists hand over an additional $35 million to the project. These funds are in addition to $20 million that Twitter had previously raised. As of March 1, 2009, Twitter’s estimated value is around $50 million even though no revenue is directly generated from the site.
Facebook recently offered to buy out Twitter for a whopping $500 million of its stock including additional cash, but the owners quickly turned down the offer, convinced that the value of their service could quickly surpass that amount.
Usually, investors want to see a very clear and detailed business plan before joining a company, but because of the obvious potential Twitter has, this rule of thumb was not necessary. Twitter is still so new and has taken off so quickly that a clear business plan and monetization methods for the future are still unknown. Regardless, investors and venture capitalists are in no short supply.
Twitter reports that they have so much money on hand that they can continue operations for years without having to worry about generating money from their service. In fact, they didn’t even seek the newest $35 million investment- the investors came knocking on their door!
Investors are not worried about receiving a return on the money they’ve injected in the project. One of the major investors said “when you have tens of millions or hundreds of millions of people actively engaged every day, you’ve got all sorts of monetization opportunities”. Some speculate the Twitter may one day be more popular than email or instant messaging.
Although monetization of the site will inevitably take place in the future, Twitter’s co-founder Biz Stone promises that Twitter will always remain free to everyone.
Some of Twitter’s major public recognitions have included CNN news and the 2009 Grammy Awards.
Stone reports that Twitter users have increased by 900 percent in the past year, and although their web traffic is huge, they receive twice as much traffic through mobile devices.
Don’t forget to use tw.itter.me to shorten your Twitter links!