The social media company announced the news in one of its trademark 140-character messages. The filing is the first step towards a listing that analysts estimate will value the company around $10bn (£6bn) and allow backers, who have ploughed in around $1.2bn, to get a return on their investments. It is also expected to make the company’s three founders — Evan Williams, 41, Biz Stone, 39, and Jack Dorsey, 36 — hundreds of millions of dollars each.
Twitter's flotation will be the most high-profile technology flotation since Facebook’s disastrous stock market debut in May last year. On Wednesday, Facebook founder and chief executive Mark Zuckerberg gave this advice to Twitter at the TechCrunch Disrupt conference in San Francisco. For a smooth IPO, he said: “You have to know everything about your company. You’ve got to stay focused on doing the right stuff.” He cited Facebook’s strong growth in mobile as an example of the importance of identifying the right areas of focus for a company. Lack of mobile presence had weighed on the company's shares but this changed in July when the company reported that 41pc of its total advertising revenue was derived from mobile.
Twitter recently announced plans to update its site and mobile apps to make it easier for users to carry out conversations on the site and share them with others outside of Twitter. Twitter has also acquired a mobile advertising firm, marking its biggest acquisition to date and helping to plug some of the holes that could hinder its flotation. MoPub, a mobile advertising business, enables companies to buy ad space automatically. It bought the company for a stake in Twitter valued at between $300m to $400m, according to reports.
"The news that Twitter has confidentially filed for an IPO will come as little surprise to most, as over the last twelve months there's been a marked increase in Twitter's focus on its paid advertising services, as well as an increasing focus on building relationships with key agencies and businesses," said Jed Hallam, head of social strategy at media agency Mindshare UK. "I'd expect to see a similar response from Twitter post-IPO that we saw from Facebook – a razor-sharp focus on building the platform into a financially viable business (which, given it has confidentially filed for an IPO, suggests current revenues are under $1billion)."
Source: The Telegraph
