Hacker News Reader

Comment by frb | Hacker News Reader

Is Twitter actually making any money?

I find these billion dollar valuations pretty crazy if the company in question is not actually making any money.

Sure, Microsoft and Google have their strategies and would spare no pains (money) to score each other off, but this overvaluation of companies is just not healthy for the tech industry. It just feeds the next big bubble.

View on HN

During a conversation I had last week a colleague who's dealt with Twitter told me that they make $100M-$200M each year licensing the firehose.

So they have a 20 - 40x valuation? wow

Valuation is not the same as "yearly income". Not anywhere close to that. If you sell a company for 1 year's worth of income, you're a fool.

Unless it's a y2k bug company, and it's October 1999.

I thought normal valuation was 5 - 7x revenue, not 20 - 40x.

Twitter is arguably not a normal company. They have mindshare that is worth a lot more than Random Internet Startup.

How many customers do they have though.

If they're 'licensing' the firehose to Google and MS, that's pretty unreliable income.

Publicly their firehose customers include Google, MS, and ~10-12 startups whose names I don't know.

Soon they'll begin seeing revenue from the new half/10% hose plans announced last week.

We know they make at least 100K each day (per market?) for Promoted Trends, which Ev said they were out of stock on. That doesn't count promoted tweets. We also know the firehose access they gave to MS + Google cost millions of dollars each. Which is separate from the access they gave Gnip. The screenshots of the business-friendly analytics tool they have coming out soon seems like it could be a "pro" tool, though I won't full on guess they will charge for it.

Reply on news.ycombinator.com