Twitter files for a confidential IPO, estimated to be valued at USD 10 billion

twitter#ipoWith around 200 million active users, micro-blogging site Twitter has recently filed for a confidential IPO, as revealed by the company in just 140 characters via a Tweet, leaving other details about it un-said. The IPO was anticipated ever since Facebook had gone public last year, after celebrating its eight years of existence.

When a company files for an IPO confidentially they do not have to make their documents public until 21 days before it goes on the “road show” to pitch the company to big investors on Wall Street for the IPO.

Twitter had hinted its IPO plans this year in August, when the company had posted a job opening on Linkedin for financial reporting manager stating – “Responsible for preparation of monthly reporting materials, quarterly/annual financial statements and Form S-1 when we are ready to go public.”

As per a report by Reuters, Twitter filed for an IPO under The Jobs Act, passed in 2012, which requires a company in the US to go public if it has more than 2,000 private investors and are with less than USD 1 billion in revenues.

Twitter has been valued by private investors at more than USD 10 billion, and according to Max Wolff,  Greencrest Capital, Twitter should Break even this year and is on track for 40% annual growth at a USD 1 billion annual revenue run rate. eMarketer predicts that Twitter might get USD 583 million in advertising revenue for 2013 and hit USD 1 billion in 2014.

Goldman Sachs is the lead underwriter and other underwriters are expected to be named when the S-1 filing is made public.

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According to an Analyst, Twitter IPO might come nearby fourth quarter this year.

Twitter makes money by inserting paid, targeted ads that resemble ordinary, user-generated content. Launched back in 2006, today it has around than 200 million active users and the platform generates more than 400 million posts everyday.

Recent acquisitions by Twitter include social TV startup Trendrr, data analytics startup Luckysort and mobile ad company MoPub for which it paid USD 350 million. Few other acquisitions by it include We are hunted (April 2013), Vine (October 2012), Posterous, Summify and Dansient (2011).

 To contact the author, email pooja.sareen@wirefootindia.com

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