Twitter Takes Confidential Road to an IPO

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Sept. 13 (Bloomberg) -- Ian Maude, media analyst at Enders Analysis, discusses Twitter filing for an IPO what it can learn from Facebook's adventures in going public and the market for social media and tech stocks. He speaks on Bloomberg Television's "The Pulse."

Prospects for the ipo?

It is a very high market now.

We had a somewhat bumpy ride with facebook when it launched on the market last year.

They were the last people twitter should ask for advice.

That may be true.

Facebook is now trading above its ipo valuation.

Now it is certainly perceived a good time to go public.

Twitter has got over 200 million users, the revenue is great.

I think they probably feel that the time is right.

You keep saying the time is right where it the expectation was we wouldn't see this until probably midway through next year.

There has been a lot of tech ipos in the u.s. this year and most of them are now trading above their ipo valuations.

They may feel that now is the right time to go public.

Another interesting piece with mark zuckerberg's comment yesterday saying that he probably held back too long ongoing public so for whatever reason they may totally feel that the time is right.

As you said, it is a confidential ipo filing.

They have not committed to a certain date yet.

Do you think the financial community has learned lots about how these businesses should be valued over a couple -- over the last couple of years?

The chance of getting it wrong are lower now than it would have been.

I think social media is a more established part of the media universe than it was a couple of years ago.

Advertising on these platforms is much more developed and is more mature.

I think people have a better feeling about what they are getting, certainly in terms of the likely revenues.

I think it is probably seen as a less risky bets and it would have been a couple of years ago.

Why have they decided to proceed down the slightly covert ipo route?

It is a very good question.

Only they know the answer to that.

Obviously, they are allowed to do that because their revenues are under one billion a year.

It is primarily designed for high tech companies with revenues under one billion.

It is quite curious.

Not only do they file under this so-called confidential method, but they announced that they are doing it which negated their reasoning for making a confidential.

What it does do is it means they don't have to announce the financial numbers in the next few weeks, at least until they have a confirmed date for the ipo.

Picking a financial numbers, how you get money out of this business model is one of the things that raises a question around investing in any kind of social media business.

How is twitter doing getting money compared to others?

They have gotten about $600 million in revenue.

Most of that is coming from mobile and a per user basis it is about the same as facebook.

So it is generating about three or four dollars per user per year right now.

But it is growing very quickly and it has the advantage that it is primarily a mobile platform.

In the next two years all the growth in internet usage has really been driven by mobile.

Difficult currency for acquisitions?

Yes and also it will allow the early investors to cash in.

That is already happening.

I think certainly some early investors will cash in, but as you say, going forward, they are going to need more money to really compete with google and facebook.

Going public will enable them to do that.

And the phenomenon as part of our lives, how much further does it have to go?

It strikes me that in the early days a lot of people got onto twitter because they liked the chance to talk and get their views out there.

What strikes me as someone who has been using twitter a little while now, the longer i use it , yes, i tweed and i get my thoughts out there, but i get so much from listening, not actually from tweeting.

Listening to what everyone else is doing and using it as a sounding post.

Are people taking to it in that way?

On facebook it is more about you connecting with your friends wear on twitter it is more a broadcast platform.

Lots of celebrities, politicians, people in the public use it as a way of getting their message out there.

It is much more driven by people wanting to say something rather than a conversation as in facebook.

It's big advantages, it is all real time and this which at the moment is to real-time but forms and twitter is at the heart of that.

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


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