Twitter Is Striking While the Iron Is Hot: Pachter

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Sept. 12 (Bloomberg) -- Michael Pachter, managing director at Wedbush Securities, and Crawford Del Prete, chief research officer at IDC, discuss Twitter's IPO filing with Emily Chang on Bloomberg Television's "Bloomberg West." (Source: Bloomberg)

Michael, i will start with you.

What do you think of the timing?

What are you hoping to see?

I am hoping that my number of twitter followers finally passes yours.

But i do not know about that, michael.

But you are so much cuter than me.

You are going to see some document finally right around halloween.

I think you will see an ipo right around thanksgiving.

I do not think this company is anywhere near as complicated as groupon.

The accounting is not that hard.

They only have three products.

It is pretty easy to account for.

The leak today, on twitter, is more of a signal they are closer rather than farther away.

I think they are trying to build buzz.

They are striking while the iron is hot.

The valuation , i just spoke to kevin, he said 15-16,000,000,000 dollar valuation right now.

They are taking advantage of what we have seen as a rally on all of the internet stocks.

Crawford, i want to talk to you about growth.

We know they have more than 200 million users.

Facebook has upwards of a billion.

Compare twitter to facebook.

Can twitter becomes something that is truly mainstream?

There is no question.

There is no question that they can approach the number of users that facebook has.

If you look at it, what facebook is trying to do, they are trying to great index of people in the world.

Trader -- twitter is trying to create a new medium for the way people communicate in real time across multiple dimensions.

They are transforming the way we communicate.

I think if the facebook ipo and the lack of success had some real impact on twitter.

I agree with michael, the timing is very interesting.

Not only are they getting the market behind them, but they are also the confidence in the facebook model, this is a real company.

This is a company that can raise money.

It is a statement on how transformative the third platform companies, these companies that are a confluence of mobile, social, and the cloud are to the everyday life of people.

The twitter ceo said last year that twitter makes more money from mobile than they do from the web and from desktop.

I do not know if that is still the case.

A year ago, that was.

Facebook make zero money from mobile when it went public.

Michael, what do you think twitter's numbers actually look like?

My guess is they are right around 500 million.

The most recent quarter, probably about 125 million.

We have seen rapid growth.

They are right on track to be at a billion dollar revenue level next year, maybe higher.

How would you break that down, michael?

I doubt they were -- they will ever disclose that number specifically.

Mobile use is probably about 60% . it is so easy.

It is really easy to access on mobile.

My guess is that less than 60% of revenue.

Twitter has made huge improvements to its advertising product in the last couple of years.

They have been working hard on video.

They just made one of their biggest acquisitions ever.

Michael, talk to us about the ad products.

Where are the weaknesses?

They have not been a great job on video yet.

I think they will.

People want the information on twitter badly enough that they are willing to sit through an interstitial.

They certainly can have advertisers place ads in their video ads in the twitter feed.

I get those on my facebook feed right now and i like them.

There is a huge opportunity.

On desktop, or is a tremendous amount of white space.

-- they are is a tremendous amount of white space.

In comparison to the facebook ipo, mark zuckerberg was on stage in san francisco yesterday.

Michael arrington asked him, what advice do you have for other companies about how to ipo smoothly?

Zuckerberg responded with this.

I am the least -- i am the person you would want to asked last.

[laughter] crawford, what are some of the challenges that twitter is going to face with this ipo?

Could there be any resemblance to some of the problems?

As michael said, their business model is a lot simpler.

I would argue that even their mobile revenue may be even higher than 60% the cuts this was really born on mobile and it fits into the way people lived every single day.

There are a lot of questions with facebook around where their mobile advertising strategy was, how they would grow that.

For twitter, it will be a lot more straightforward for them to be able to demonstrate where they have had success and if they can show momentum in those areas, they will have a pretty straightforward discussion with the bankers.

If they start to say, there are all these new areas we could be growing into, new kinds of revenue streams, new types of advertising, then you start getting into the trouble.

It will really come down to the momentum that we see in their core businesses and their ability to communicate.

I would expect it will be that.

As opposed to some new areas.

Crawford and michael, thank

This text has been automatically generated. It may not be 100% accurate.


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