Kathy Woolverton
December 28, 2010

Twitter's business valuation has jumped to an amazing $3.7 billion valuation, with the closing its latest reported $200 million round of funding.


Any business owner/entrepreneur will realize the disconnect with traditional business valuations. What is even more amazing is that this is for a for a firm with just the beginning of a business model to generate income!


What they do have going for them is user traction and international brand recognition, with more than 175 million registered user accounts. Is Twitter worth $3.7 billion dollar valuation


In the past 12 months, Twitter users sent an astonishing 25 billion Tweets and more than 100 million new registered accounts were added.


The majority of their promotion and marketing efforts is also free, with many websites linking to their Twitter accounts, and many people adding their Twitter account to their business card. Think of the powerful impact of over 175 million people and businesses recommending your business to others!


As a business, you can use Twitter to quickly share information, gather market intelligence and insights, and build relationships with people who care about your company. Think of Twitter as a consise conversation.


According to All Things Digital, the lead investor in the round is Kleiner Perkins Caufield & Byers (KPCB), and KPCB beat out DST Global to get the Twitter deal. DST has recently been the lead investor in massive funding rounds for the likes of Facebook and Zynga.


Although one of Silicon Valley’s most prominent venture capital firms, the deal represents the first investment KPCB has made in Twitter. KPCB is also one of the lead investors in the Facebook-led sFund and previously launched the iFund for investing in iOS apps for the iPhone and iPad.


With the funding, Twitter has now raised an estimated $360 million. The company’s last major round came in September 2009, when it closed $100 million in funding at a valuation of around $1 billion.


At that time, Twitter was a quickly growing micro-blogging social networking site without much of a business model to speak of. Since then, the company has introduced a variety of revenue streams, most prominently its Promoted Tweets and Trends products.


Interesting to see how Twitter is hoping to scale up these adverting based products. On Twitter's page to inquire about advertising, where you select your Estimated Monthly Budget, the smallest budget category option starts at < $10,000 per month and go to $100,000+ per month. </P>

Twitter was founded in March 2006, and launched publicly in July 2006.


In the past 12 months, Twitter's team has grown from 130 people to more than 350 today.


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