Surfair
110799

Twitter said to be in talks to buy up Flipboard

The deal would give Twitter relationships with thousands of publishers, and potentially a new CEO

Financial trends and news by Steven Loeb
May 26, 2015
Short URL: http://vator.tv/n/3df6

With Facebook launching its new Instant Articles program, which will allow the service to quickly deliver articles through partnerships with numerous publishers, the race is on to get as much as content as possible onto your social network.

Twitter has heard the message loud and clear, and it may have figured out the best way to do it: buy an app that has already made those partnerships.

The company is said to be currently in talks to acquire mobile media magazine app Flipboard, according to a report out from Re/Code on Monday. It is reportedly an all-stock deal that would value the company at over $1 billion.

Talks, which have been going on for the last six months or so, are being led by Anthony Noto, CFO at Twitter, but they have also apparently hit a wall, and are said to currently be stalled.

Flipboard aggregates news from media feeds and social media websites, including both Twitter and Facebook. It takes all of those streams of data, and presents it in a magazine format that users can flip through.

Publishers that the company works with include Vanity Fair, Vogue, The Daily Beast, National Geographic, CNN, The Guardian and thousands more. 

The company currently offers 19 localized editions of its app, for Arabic, Australia, Brazil, Canada, China, France, Germany, Hong Kong, India, Italy, Japan, Korea, Latin America, Netherlands, Russia, Spain, Taiwan, Turkey, U.S. and U.K. As of March, it had more than 15 million public magazines created by people using Flipboard, and 50 million active readers. 

The two companies have deep ties, and a long history, as Mike McCue, the co-founder and CEO of Flipboard, was formerly a member of the board of directors at Twitter, and Twitter co-founder Jack Dorsey is an investor in Flipboard. 

In January, when Twitter revealed its plan to sell advertisements within the streams of tweets that appear on apps and websites from other publishers, Flipboard was mentioned as a potential partner, and the two companies made it official in February. 

The company, which has raised $161 million to date, most recently a $50 million add on to its Series C round December 2013 is said to be valued at $800 million.

While the idea of getting more publishers on its side is certainly enticing to Twitter, there may be something else at play here. Given McCue's history with Twitter, Re/Code mentions him as a potential replacement for current Twitter CEO Dick Costolo, who has been on the hot seat lately, especially as Twitter has been seeing revenue misses and slowing user growth over the last few quarters.

Flipboard is also a potential acquisition target for other companies, including Facebook, which tried, and failed, to launch its own reader app called Paper. Its easy to see Facebook simply buying a company to do what it couldn't do in-house. 

Another potential buyer is Google.

In March, after Google announced that it was going tp split Google+ into two separate apps, one for social and one for streaming, along with a new man in charge in the form of product vice-president Bradley Horowitz, Robert Scoble, tech evangelist and Startup Liaison Officer and Technology Evangelist at Rackspace, specifically mentioned Google buying the company as a potential way for it to bolster up its stream.

"If Google bought Flipboard, then I'd say, 'You're back in the game.' Horowtiz drove the acquisition of Flickr, so he understands the power of a good acquisition. It wouldn’t shock me if he bought something like Flipboard or Circa or Prismatic. It would let me know they have an idea of where they went wrong and how to fix it."

Suddenly, it seems, Flipboard has become the hot property, and Twitter should act fast, because, asGoogle already knows, a deal is never done until it's done. 

"We don’t comment on rumor or speculation," a Twitter spokesperson told VatorNews. We have also reached out to Flipboard for comment on the report and we will update this story if we learn more. 

(Image source: macstories.net)


Related companies, investors and entrepreneurs

1587
Twitter
Startup/Business
Description: What is Twitter? Twitter is an online information network that allows anyone with an account to post 140 character messages, called tweet...
Default
Flipboard
Startup/Business
Description: The world's first social magazine. Flipboard is a fast, beautiful way to flip through news, photos and updates your friends are sharing o...

Related news