Twitter says it plans to join the stock market in the most hotly anticipated flotation since Facebook's last year.Referring to the official paperwork needed to join the market the company tweeted: "We've confidentially submitted an S-1 to the SEC for a planned [initial public offering]."
Investors value Twitter, founded in 2006 by Jack Dorsey, Biz Stone and Evan Williams, at more than $10bn (£6.3bn). Twitter gave no further details as to the timing or price of the offering.It is on track to post $583 million in revenue in 2013, according to advertising consultancy eMarketer.Once a company has filed paperwork with US regulators for a planned IPO it enters a so-called "quiet period" when it is not allowed to speak with the press.
According to the Securities and Exchanges Commission's website, a company can file a confidential prospectus for a public share sale if it is classified as an "emerging growth company" with revenue of less than $1bn.
Mobile first
On Monday, Twitter said it had acquired MoPub, a mobile-focused advertising exchange, for a reported $350m, as part of its continued push to boost advertising."Twitter was more or less a mobile-first platform from the start and so the company built its experience to work relatively well across devices," Clark Fredriksen of eMarketer told the BBC.
"Ultimately, they did a good job of monetising their mobile user base."
Some speculate that the timing of the IPO has to do with the company's desire to further grow - as well as with its desire to reward investors, who have poured more than $1bn into the company. "For one thing it gives its investors a way to get some of the money back that they put into the company at the beginning," said Andrew Frank, social media expert at tech advisors Gartner.
"It gives the employees a similar kind of event to reward them for the success they've had so far.
"It gives Twitter itself extra funds to invest in new projects and innovation. It also gives it the status of having a position on the stock exchange, which of course puts the firm in a different league to a start-up."
Learning from Facebook
"Twitter is one of the last of the major developed social networks to file [for an IPO] - we've already had Facebook and LinkedIn," said Colin Gillis, a New York-based tech specialist at BGC Partners.
Demand for Facebook shares was high when they first listed, but the share price has disappointed investors since then
Facebook listed on the stock market in May last year. Although it initially created excitement among investors, its share price performed poorly, before recovering this summer. Mr Gillis said it was impossible to say how great the demand for Twitter shares would be until the company released a valuation. "There's a few issues [such as] how many revenue streams can be developed beyond just advertising, the impact of more people accessing the service via smartphones," Mr Gillis said.
Analysts say Twitter must continue to innovate under the scrutiny of public ownership."One of the things they will have to focus on is making sure that they keep their users very actively engaged," Nate Elliott, an analyst at the tech consultancy Forrester, told the BBC."One of the things Facebook has done very successfully over the past year and a half has been to show that not only is the number of users growing, but that those users are becoming more active."
'This tweet I tweet announcing its filing immediately went viral - it was re-tweeted more than 8,000 times wits going public". For many users, it seemed apt that the company would use its own platform to announce the news.
"Naturally Twitter announces its IPO via Twitter. What other way?" one read. Twitter later sent a follow up tweet, which read simply: "Now, back to work."
Investors value Twitter, founded in 2006 by Jack Dorsey, Biz Stone and Evan Williams, at more than $10bn (£6.3bn). Twitter gave no further details as to the timing or price of the offering.It is on track to post $583 million in revenue in 2013, according to advertising consultancy eMarketer.Once a company has filed paperwork with US regulators for a planned IPO it enters a so-called "quiet period" when it is not allowed to speak with the press.
According to the Securities and Exchanges Commission's website, a company can file a confidential prospectus for a public share sale if it is classified as an "emerging growth company" with revenue of less than $1bn.
Mobile first
On Monday, Twitter said it had acquired MoPub, a mobile-focused advertising exchange, for a reported $350m, as part of its continued push to boost advertising."Twitter was more or less a mobile-first platform from the start and so the company built its experience to work relatively well across devices," Clark Fredriksen of eMarketer told the BBC.
"Ultimately, they did a good job of monetising their mobile user base."
Some speculate that the timing of the IPO has to do with the company's desire to further grow - as well as with its desire to reward investors, who have poured more than $1bn into the company. "For one thing it gives its investors a way to get some of the money back that they put into the company at the beginning," said Andrew Frank, social media expert at tech advisors Gartner.
"It gives the employees a similar kind of event to reward them for the success they've had so far.
"It gives Twitter itself extra funds to invest in new projects and innovation. It also gives it the status of having a position on the stock exchange, which of course puts the firm in a different league to a start-up."
Learning from Facebook
"Twitter is one of the last of the major developed social networks to file [for an IPO] - we've already had Facebook and LinkedIn," said Colin Gillis, a New York-based tech specialist at BGC Partners.
Demand for Facebook shares was high when they first listed, but the share price has disappointed investors since thenFacebook listed on the stock market in May last year. Although it initially created excitement among investors, its share price performed poorly, before recovering this summer. Mr Gillis said it was impossible to say how great the demand for Twitter shares would be until the company released a valuation. "There's a few issues [such as] how many revenue streams can be developed beyond just advertising, the impact of more people accessing the service via smartphones," Mr Gillis said.
Analysts say Twitter must continue to innovate under the scrutiny of public ownership."One of the things they will have to focus on is making sure that they keep their users very actively engaged," Nate Elliott, an analyst at the tech consultancy Forrester, told the BBC."One of the things Facebook has done very successfully over the past year and a half has been to show that not only is the number of users growing, but that those users are becoming more active."
'This tweet I tweet announcing its filing immediately went viral - it was re-tweeted more than 8,000 times wits going public". For many users, it seemed apt that the company would use its own platform to announce the news.
"Naturally Twitter announces its IPO via Twitter. What other way?" one read. Twitter later sent a follow up tweet, which read simply: "Now, back to work."
Twitter plans stock market listing
![]()
Reviewed by Alex Carson
on
Friday, September 13, 2013
Rating:
Alex Carson
Keeping you up to date on social media, digital marketing, apps, news & reviews. Social media, and digital marketing as a whole, are rapidly and constantly changing, adapting to new developments at an ever increasing rate. Just keeping up to date can be a nightmare. Our team of writers know their field, and keep an ear to the ground. We aim to keep you informed of all recent developments in the online world, and teach you a little something along the way. So whether you just want to stay connected, or gain some knowledge for yourself, the Social Songbird will keep on singing! More articles are posted every day so keep checking back! Join the discussion on Twitter - #SocialSongbird Or contact us directly - @SocialSongbird_
Entrepreneur, international speaker on Social Media Marketing. First one in the UK to write and speak in conferences about Twitter as a marketing tool. Consultant to Corporate Companies, Government Organizations, Marketing Managers and Business Owners.
Aspiring novelist with a passion for fantasy and crime thrillers. He hopes to one day drop that 'aspiring' prefix. He started as a writer and soon after he was made Executive Editor and Manager of the team at Social Songbird. A position he held for 5 years.
Adrienne is a passionate writer with experience in editing, content creation, and social media marketing. She’s a lover of animals, helping others improve their writing, and 2000s pop culture.
Musician, audio technician, professional tutor and a Cambridge university English student. Interested in writing, politics and obsessed with reading.
Recently graduated with a BA in English Literature from the University of Exeter, and he is about to study an MA in Journalism at the University of Sheffield. He is an aspiring journalist and novelist; in his free time he enjoys playing chess, listening to music and taking long walks through nature.
Lucy is an undergraduate BSc Politics and International Relations student at the London School of Economics and Political Science.
Anna Coopey is a 4th year UG student in Classics at the University of St Andrews in Scotland. She is a keen writer and researcher on a number of topics, varying from Modern Greek literature to revolutionary theory.
Ellie is a recent BA English Literature graduate and aspiring publisher with a passion for writing. Her favourite pastimes include reading and shopping.