The company also unveiled its enterprise product, summarizing reports for cliniciansRead more...
Procedures may be altered to to give late-stage private companies more leeway in fundraising
By waiting longer than is typical to go public, hot tech companies like Facebook, Twitter and Zynga might be forever changing how business is done in the world of startups.
In an unexpected turn of events, the Securities and Exchange Commission (SEC) may eliminate roadblocks for startups looking to raise large rounds of capital in their later stages, as revealed in a letter to California representative Darrell Issa.
Unexpected because, just three months ago, a new $450 million Goldman Sachs investment in Facebook sparked an SEC inquiry. The deal appeared to bypass rules requiring private companies with 500 or more investors to disclose financial information, as a public company would, by creating a special purpose vehicle allowing multiple investors to pool money under one name.
Now, it’s starting to look like the SEC may do away with the rule entirely, leaving startups to raise increasingly large rounds of venture capital from wider groups of investors. It grants those businesses more flexibility in their growth, but it leaves out ordinary investors waiting in the public market.
While most companies are typically highly reticent to comment on the possibility of an impending IPO, representatives from both Facebook and Zynga have confessed very little interest in going public early. It seems that the new rule for startups is to put the IPO off for as long as possible.
"[Facebook] probably will IPO at some point,” said Peter Thiel, an early investor in the company and a sitting member on the board of directors, last fall. “The lesson from Google seems to be that you don't go public until very late.”
Google waited six years after its founding to go public. Today, Facebook is seven years old.
Zynga, a four-year-old startup and one that bolstered its financial portfolio even faster than Facebook, appears even less ready to consider an IPO.
"I always scratched my head and said, 'Why?' Why on Earth would you go public if you want your company to be sustainable and to last? I get really confused why anyone would go public," proclaimed Mark Pincus, CEO of Zynga, at Vator Splash in February 2010.
We already know these companies are changing the face of the Web, but now they might actually be changing the usual pace of business altogether.
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What is Twitter?
Twitter is an online information network that allows anyone with an account to post 140 character messages, called tweets. It is free to sign up. Users then follow other accounts which they are interested in, and view the tweets of everyone they follow in their "timeline." Most Twitter accounts are public, where one does not need to approve a request to follow, or need to follow back. This makes Twitter a powerful "one to many" broadcast platform where individuals, companies or organizations can reach millions of followers with a single message. Twitter is accessible from Twitter.com, our mobile website, SMS, our mobile apps for iPhone, Android, Blackberry, our iPad application, or 3rd party clients built by outside developers using our API. Twitter accounts can also be private, where the owner must approve follower requests.
Where did the idea for Twitter come from?
Twitter started as an internal project within the podcasting company Odeo. Jack Dorsey, and engineer, had long been interested in status updates. Jack developed the idea, along with Biz Stone, and the first prototype was built in two weeks in March 2006 and launched publicly in August of 2006. The service grew popular very quickly and it soon made sense for Twitter to move outside of Odea. In May 2007, Twitter Inc was founded.
How is Twitter built?
Our engineering team works with a web application framework called Ruby on Rails. We all work on Apple computers except for testing purposes.
We built Twitter using Ruby on Rails because it allows us to work quickly and easily--our team likes to deploy features and changes multiple times per day. Rails provides skeleton code frameworks so we don't have to re-invent the wheel every time we want to add something simple like a sign in form or a picture upload feature.
How do you make money from Twitter?
There are a few ways that Twitter makes money. We have licensing deals in place with Google, Yahoo!, and Microsoft's Bing to give them access to the "firehose" - a stream of tweets so that they can more easily incorporate those tweets into their search results.
In Summer 2010, we launched our Promoted Tweets product. Promoted Tweets are a special kind of tweet which appear at the top of search results within Twitter.com, if a company has bid on that keyword. Unlike search results in search engines, Promoted Tweets are normal tweets from a business, so they are as interactive as any other tweet - you can @reply, favorite or retweet a Promoted Tweet.
At the same time, we launched Promoted Trends, where companies can place a trend (clearly marked Promoted) within Twitter's Trending Topics. These are especially effective for upcoming launches, like a movie or album release.
Lastly, we started a Twitter account called @earlybird where we partner with other companies to provide users with a special, short-term deal. For example, we partnered with Virgin America for a special day of fares on Virginamerica.com that were only accessible through the link in the @earlybird tweet.
What's next for Twitter?
We continue to focus on building a product that provides value for users.
We're building Twitter, Inc into a successful, revenue-generating company that attracts world-class talent with an inspiring culture and attitude towards doing business.
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Zynga is the largest social gaming company with 8.5 million daily users and 45 million monthly users. Zynga’s games are available on Facebook, MySpace, Bebo, Hi5, Friendster, Yahoo! and the iPhone, and include Texas Hold’Em Poker, Mafia Wars, YoVille, Vampires, Street Racing, Scramble and Word Twist. The company is funded by Kleiner Perkins Caufield & Byers, IVP, Union Square Ventures, Foundry Group, Avalon Ventures, Pilot Group, Reid Hoffman and Peter Thiel. Zynga is headquartered at the Chip Factory in San Francisco. For more information, please visit www.zynga.com.