Twitter has been valued at $1bn by a group of investors
expected to announce a deal for $100m in funding as soon as
today.
The potential investors include mutual fund giant T. Rowe Price,
private equity firm Insight Venture Partners, and existing Twitter
investors Spark Capital and Institutional Venture Partners,
according to the
Wall
Street Journal.
Twitter's valuation indicates investors' confidence that the
move to instant publishing online represents a long-term shift in
how people use the web, according to analysts.
They also said the funding will win Twitter more time to develop
a business model to give the micro-blogging service steady sources
of revenue.
In its recent revision of terms and conditions, Twitter
left the door open for targeted advertising on its service,
indicating plans to develop ways of earning money this way.
The company said it maintains its right to distribute
advertising and that the type and extent of its advertising is
subject to change.
Financial interest
The fundraising will be Twitter's second this year and comes
amid growing interest in the organisation from larger media,
internet and telecoms companies, including Facebook.
In February, Twitter took $35m in funding from Benchmark Capital
and Institutional Venture Partners, which put Twitter's value
around $250m at the time.
Twitter's choice of financial investors over strategic
partnerships could give it more flexibility in the future,
according to the
Financial Times.
Facebook strategy
The strategy contrasts with Facebook's decision to accept a
$200m investment from Eastern European and Russian internet
firm Digital Sky Technologies (DST).
The partnership with DST is thought to be strategic for
Facebook's growth in Russia because of DST's government connections
and experience in making money through social networking sites.
Facebook's partnership with DST could soon see the introduction
of alternative sources of revenue to boost its income from
advertising.
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