My Ten Favorite Tweets – Week Ending 022610

From the home office at a table in front a congressional hearing where I’m explaining why I didn’t actually put any brakes in my cars…

#1: All your authentication are belong to us by Forrester’s @TomGrantForr > Facebook Connect is pulling away

#2: RT @defrag wow. twitter moving to Cassandra (#NoSQL) – – so, FB, Digg, Twitter all on NoSQL. oracle, are you listening?

#3: Interesting: Why the iPad can’t use flash > How do you “mouseover” with your finger?

#4: RT @BBHLabs Bored of reading that @foursquare is the ‘new Twitter’; it’s a different kind of utility altogether –

#5: Study – Distributed Idea Generation Outperforms Team Brainstorming (Spigit blog) #innovation #crowdsourcing

#6: Crowdsourcing Collaboration in Education by @eduinnovation > Educators can tap large networks #innovation

#7: How to Fail at Innovation by @timkastelle > “The way to fail at #innovation is to try to avoid failing”

#8: The Side Effects of Open Innovation by @lindegaard “it’s very much about managing change” #innovation #e20

#9: 10 tips for Successful Crowdsourcing

#10: RT @exUnited Southwest Airlines selects Spigit for innovation mgmt Innovation is like LUV – deliberate, not accidental


My Ten Favorite Tweets – Week Ending 042409

From the home office in Detroit, Michigan…

#1: poll asks, “Do you use Twitter?” 331k respondents. 7% yes. 63% no. 30% “what’s Twitter?”

#2: Hey bloggers – make sure your twitter handle is somewhere on your blogs. I like to tweet a link with your Twitter handle. Easy visibility.

#3: My Twitter personality: renowned spamming cautious My style: garrulous academic ROBOT {ROBOT? Say what?}

#4: Great tips about social media releases for companies on @mediaphyter‘s blog by @serena

#5: Reading: “Don’t cut back on innovation” in Fortune by Anne Mulcahy, Xerox CEO

#6: Interested in using enterprise 2.0 for innovation? Read this wonderful post by @ITSinsider “Putting 2.0 to Work: Spigit”

#7: With Oracle’s acq of Sun and MySQL, does PostgreSQL now merit a closer look?

#8: Fascinating study of high performance work teams. They equally mix advocacy w/ asking & external/internal focus

#9: Congrats to Ryan Hall, 3rd place in today’s Boston Marathon (2:09:40). Gutsy race he ran today.

#10: It was 91 degrees today in San Francisco, & we felt every one of those degrees at my 5 y.o. son’s birthday party. Fun, but smokin’.

Twitter’s Valuation – More Like AdultFriendFinder or YouTube?

After the recent news that Twitter turned down a $500 million acquisition offer from Facebook, I threw this tweet out there:

Twitter for $500 million..gut says that’s too low. Twitter is the defining platform for lightweight interactions. $1 billion +…

A nice discussion followed on FriendFeed about this notion. A couple counterpoints were made:

“I disagree: their model is no longer unique. Moreover, they don’t offer any particular feature that separates them from other similar models. The best they have to offer is the user base, and the right name-brand shiny shiny with a few choice features would take most of them away.”

“It’s a glorified IM network, only less functional because it’s a centralized platform with an absurd character limit that only the most ADD among us can find usable.”

My gut feeling is based on three factors:

  1. Platform
  2. Growth
  3. Comparable transactions

Here’s where I’m coming from.


Twitter has established lightweight messaging as valuable and addictive. From the simple roots of “What are you doing?”, people have morphed Twitter into a range of use cases. Open channel chats. News updates. Sharing articles and blog posts found useful. Polls. Research. Updates peers on activities and travels.

Based on tweets, companies find out how they’re doing out in the market. Twitter search yields a treasure of information about subjects. Find like-minded individuals with whom to connect.

The platform aspect is not one to be undervalued. This is a key point – platforms are worth more than any single app. Tim O’Reilly penned a thoughtful piece in this regard. With regard to Twitter as platform, he writes:

Rather than loading itself down with features, it lets others extend its reach. There are dozens of powerful third-party interface programs; there are hundreds of add-on sites and tools. Twitter even lets competitors (like FriendFeed or Facebook) slurp its content into their services. But instead of strengthening them, it seems to strengthen Twitter. It’s the new version of embrace and extend: inject and take over.

Microsharing, as Laura Fitton calls it, certainly requires some change in people’s behavior. There’s no doubt about that. But the concept of microsharing, or as it also known as, microblogging, is powerful. It’s highly flexible and has a variety of use cases.

It’s not just early adopter/social media types that are taking notice of this microsharing trend. Click here to see how often the New York Times has written about Twitter. An article on about the Mumbai terrorists included this:

Neha Viswanathan, a former regional editor for Southeast Asia and a volunteer at Global Voices, told CNN, “Even before I actually heard of it on the news I saw stuff about this on Twitter.”

Twitter is transforming in terms of social, accessible and findable updates. True platform companies with reach and highly flexible uses don’t come along very often. Twitter is one of those platform companies.


Twitter’s early period was marked by some uneven growth. But around March 2008, the service really took off. And it hasn’t looked back:


It’s fair to say that the network effects are getting stronger and stronger for Twitter. The more people that join, as seen in the graph above, the more valuable the service becomes. Search grows more and more in importance. So more people join, meaning it’s more valuable others to join, and so on…

Don’t dismiss Twitter’s growth either. This post on the Ignite Social Media blog, which shows traffic for 37 different social websites, illustrates how challenging it is for most social networks to maintain growth these days.

Twitter’s got huge momentum right now. That’s valuable.

Comparable Transactions

I researched purchase prices for technology companies in recent years. The table below shows acquisition prices for what I’ll call “market comparables”.


Valuations are more art than science. Personally, I’m a big fan of triangulating on a value by looking at what other companies have gone for.

My point with the above table is to put some context around Twitter. Danger and XenSource were important niche plays. AdultFriendFinder was valued at $500 million. Given Twitter’s role in the emerging realm of microsharing, should it have the same valuation as AdultFriendFinder?

I know that there currently is no revenue for Twitter. It’s not like they’ve tried and failed. They haven’t even tried. But my guess is Twitter’s revenue path lies beyond punching up some ads on Twitter profiles or in Twitter streams. Those may be there, but like any platform, there will be other ways to monetize.

And let us not forget YouTube’s (non existent) revenue model when Google purchased them for $1.65 billion.

What Do You Think?

I’ve laid out my thinking here. Twitter is a rare platform play that’s hit a strong growth curve. Previous acquisitions say that Twitter should be able to take advantage of those factors for any valuation.

How about you? Weigh in on the comments below, or just answer this quick poll (RSS readers – click out to take the poll!).


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