Twitter: To Invest or Not? – Hear the Experts

Image representing Twitter as depicted in Crun...

Image via CrunchBase

As part of a recent open dialogue platform, these were some questions posed to drive the conversation on Twitter’s IPO:

  1. With an IPO imminent, can Twitter be worth $40 billion two years after IPO?
  2. Where might Twitter close its first day of trading?
  3. What will it be worth a few years later?
  4. What is the viability of its ad-based model? Other possible revenue streams?

And the responses from the experts on Twitter’s value:
“I believe that a large piece of Twitter’s value over the next two years will be tied to their role as TV’s second screen, and their ability to execute advertising against it” … “Twitter has already invested heavily in being the social TV platform. The acquisitions of Bluefin Labs and Trendrr brought some really interesting technology and talent to the Twitter platform, which they’ve been able to harness into powerful second screen ad products like Twitter Amplify.”
–Jon Dick, Director of Business Development at Klout
“Twitter will raise a ton of money during the IPO and that will allow them to acquire companies, technology and people that fit into the mission and that will be amazing to watch and will be a great thing for users, employees and shareholders”… “There’s certainly value in the TV stuff and I’m sure Twitter can or will soon be able to serve ads based on tweet keywords (TV show or other) but given Facebook’s scale compared to Twitter I’d bet on FB to win those dollars at least in the short term.”
–Craig Coblenz, Former sales director at Facebook

Image representing Simon Khalaf as depicted in...

Image by None via CrunchBase

“Twitter has established itself as a cultural phenomenon more than an advertising phenomenon, which is its business model at this stage. To many, Twitter is a wire service (like Reuters), the difference is that it is curated by people and it is real time. To others, Twitter is a communications platform. For the ad business model to scale and scale fast, Twitter needs to become a media company. The focus on TV to mobile cross over dollars is interesting, but the given that it is not the main screen, but the adjunct screen (or second screen), then it will get the adjunct ad dollar and not the main one.”
–Simon Khalaf, CEO of Flurry
“Obviously there are various factors in the Twitter valuation a couple years out from the pending IPO, but I would argue if the overall mkt is up 10-20% or more over the next 2 years, it damn well better be worth $40B given the size of its audience and current growth projections. I agree with my esteemed panelists that TV market is huge for them, taking market share from google adsense is a big opportunity, and the margins given the self service nature of their platform for audience and advertisers is a huge advantage.”
–M. Scott Havens, President of The Atlantic

Image representing Francisco Diaz-Mitoma as de...

Diaz-Mitoma by None via CrunchBase

“I think one of the highest growth opportunities for Twitter’s revenues are mobile app install revenues.”
–Francisco Diaz-Mitoma, CEO at and Founder of Playsino (formerly Titan Gaming)

“Like Google Inc. and Facebook Inc. , I expect that sponsored posts, targeted ads, etc. will always make up more than 80% of Twitter’s revenues. But, as it matures, the firehose business could someday provide that extra penny or two in EPS during a tough quarter to meet or beat analyst’s expectations. And as Twitter’s management team is about to find out, that penny or two could prove to be huge.”… “Twitter’s revenue from selling data is $47.5M annually. The thing is, I don’t see this growing much over time, especially relative to ad sales. In my opinion, monetizing data off-platform will always be less lucrative than on-platform. Investors everywhere are talking about Twitter and trying to decide if they should buy on the IPO. But few people have the opportunity to get educated by world-class experts in social media on Twitter’s prospects as a public company before making an investment decision.”
–Vinny Jindal, CEO and Co-Founder of Stockr

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