Jessica Vascellaro at the Wall Street Journal is breaking the news today that the social media mavens at Twitter.com are raising an additional $100 million in venture capital, giving Twitter a new valuation close to (insert Austin Powers voice here) one billion dollars.
Jessica notes that previous funding valued the company at about 255 million. The new funding round not only confirms that Twitter is now a key major online player but will give them huge resources to continue rapid growth and expansion and perhaps even marketing, although one of Twitter’s brilliancies is that it needs an advertising budget of zero. Twitter is the ultimate “word of mouth” tool for the online generation and everybody from celebrities to businesses are using the tool to create a dialog with fans, customers, and friends. Where Facebook is powerful as a tool for maintaining relationships with friends and family, Twitter is superior as the fast and superficial way to keep in touch, “shout out” a message to the world, and generally manage large networks of customers, friends, conference attendees, etc. There’s room for several social networking tools but I think we’ll see both Facebook and Twitter continue to thrive and grow substantially in the coming years.
As we’ve been noting for some time Twitter represents something of a “perfect online storm” where timing, simplicity, and social media are combined in a way that appeals to both sophisticated and new technology users. The last time we saw this combination of innovation with the technological zeitgeist was Google search, and we all know how that turned out.
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