Twitter raises $800 million in funding to help cash out some current investors and employees

Posted by Knowlton Thomas

Twitter plans on completing its $800 million round of funding within the next two weeks, according to AllThingsDigital.

Half of the funding is intended to help investors and employees cash out in an "organized and legal manner." 

With the company having no news about an IPO in the near future (although it must be tempting given the insane valuations floating around this year), it's a wise move to internally monetize its privately held common stock for those ready to realize the return on their investment.

This funding will value Twitter at roughly $8 billion. As The New York Times reported last week, this valuation seems unjustifiably high. The San Fransisco microblogging company is currently making about $200 million annually off its advertising platform (promoted tweets and the like). But this only breaks even its costs—the company has yet to become officially profitable.

It's not known who can sell Twitter shares as part of this deal, or how much they can sell. But it's highly similar to Facebook's 2009 funding that aimed to accomplish the same effect. In that deal, top leadership could not sell any stakes, but employees could cash out up to 20 percent of their shares.

 

Company:
Twitter
Website:
http://www.twitter.com
Location:
San Francisco, California, United States

Twitter is a privately funded startup with offices in the SoMA neighborhood of San Francisco, CA. Started as a side project in March of 2006, Twitter has grown into a real-time short messaging service that works over multiple networks and devices. In countries all around the world, people follow the sources most relevant to them and access information via Twitter as it happens—from breaking world news to updates... more


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Knowlton Thomas

Knowlton Thomas

Knowlton is the managing editor of Techvibes. Based in Vancouver, Knowlton has been published in national publications and has also appeared on television and radio. Previously he was an editor for New Westminster weekly The Other Press and served on its board of directors. When not working, Knowlton enjoys playing tennis or otherwise enjoying the outdoors. more



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