Fri, Dec 17, 2010 - Page 10 News List

Twitter now valued at US$3.7 billion

FULL STEAM AHEAD:With investors keen to provide financing, Twitter now employs about 350 people, more than tripling its employee payroll since the beginning of the year

Reuters and AP, SAN FRANCISCO

Twitter has raised US$200 million in financing in a deal that values the microblogging company at US$3.7 billion, less than a year after it began its first serious efforts to make money.

The investment came from Silicon Valley venture capital firm Kleiner Perkins Caufield & Byers and existing investors, Twitter said.

The money will help Twitter grow the company, Twitter said in a post on its corporate blog on Wednesday. The blog post did not elaborate and a spokesman declined to offer specifics.

Twitter, which had 175 million users as of September, is among the new crop of quickly growing Internet social networking services. Others include Facebook and Zynga.

The company added two new board members — FlipBoard chief executive Mike McCue and DoubleClick chief executive David Rosenblatt.

The move comes two months after the four-year-old company handed the job of chief executive to Dick Costolo, the architect of its new advertising effort, a sign that making money is a priority for the service.

Costolo said in May that Twitter planned to have hundreds of -advertisers using its ad system by the end of the year. He said the company’s previous valuation of US$1 billion meant that it was incumbent on Twitter to develop a business that can generate hundreds of millions of dollars of revenue.

In a Wednesday tweet, Costolo said the new funding will “help grow Twitter to infinity and beyond.”

Twitter had raised US$160 million in four earlier funding rounds.

Technology blog AllThingsDigital first reported the US$200 million funding round. It said that Kleiner Perkins beat out Russian investment firm DST Global. The Twitter spokesman confirmed that the figures were accurate.

Twitter, which allows users to send 140-character text messages, or tweets, to followers, is one of the Web’s most popular social networks and is challenging established Web services like Google Inc and Yahoo Inc.

Investors are watching the service closely, hoping one day to buy public shares in the company.

Twitter hasn’t set a timetable for pursuing an IPO that would -allow its current backers to cash out of their investments and give others a chance to buy the company’s stock. Its executives, though, have repeatedly said they are in no hurry to take the company public.

With so much cash being supplied by investors, Twitter’s management has been able to focus on hiring more workers and adding more features instead of worrying about how to make money. The company, based in San Francisco, now employs about 350 people, more than tripling its payroll since the beginning of the year.

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