Boston, Seattle Investors Pony Up for Twitter
Twitter, whose hybrid text messaging/social networking/microblogging service has made missives of 140 characters or less into the hottest new form of Internet communication, announced yesterday that it’s finally accepted a major venture funding round. The news couldn’t have come early enough for Twitter addicts, who have been increasingly frantic lately about the service’s frequent outages.
The two venture sources pairing up to support Twitter are Boston’s Spark Capital, whose media-technology focus we’ve remarked upon before, and Seattle’s Bezos Expeditions, which manages the personal venture portfolio of Amazon CEO Jeff Bezos. Twitter isn’t saying how much money the two organizations invested, but PaidContent.org puts it at $15 million.
In a blog post, Twitter co-founder Biz Stone said that the startup wants to make Twitter into a “global communication utility” and acknowledged, indirectly, that the service doesn’t yet work as reliably as most people expect a utility to work. The funding round “gives us the runway we need to stay focused on the infrastructure that will help our business take flight,” he said, adding that the company will use the money to bring in more engineers, operators, software architects, and consultants.
Along the way, Stone and co-founder Evan Williams, a veteran of startups Blogger (which he sold to Google) and Odeo (sold to SonicMountain), will also need to invent a viable business model for Twitter. To date, the company hasn’t charged for its service, which allows users to write short messages—usually, updates about their moment-to-moment whereabouts or doings—and broadcast them to subscribers, known as “followers.” (You can subscribe to my own Twitter stream, for example, at www.twitter.com/wroush.) And while it has opened up the service to outside developers, who have come up with a variety of specialized Twitter clients such as Twhirl, Twitterific, and Google’s Twitter Gadget, it hasn’t yet introduced advertising or other ways of monetizing the huge number of messages—estimated at 3 million per day, as of March 2008—that pass through the system.
In his own blog post on the funding round, Spark Capital’s Bijan Sabet, who will take a seat on Twitter’s board and is a frequent Twitter user himself, called the company’s founders “a fantastic team.” In other posts, Sabet has called Twitter “addicting” and likened it to a persistent, always-on chat room for his online friends.