JPMorgan Chase is aiming to invest in Twitter increasing the value of company to $4.5 b. JP Morgan is likely to invest about $1.22 b in Twitter which will help in former's further development. JP Morgan is following the example of Goldman Sach which has developed and established its existence after investing $1.5 b in Facebook which gave value to FB upto $50b.
It is vague whether the fund, JP Morgan Digital Growth Fund, will invest directly in Twitter or purchase the incumbent investor’s stake with the company’s agreement. The talks are still in process.
JP Morgon is also expected to extend their fund to other markets of social media such as Zynga and Living Social. The companies which they prefer must have an established business model.
The news of the investment in Twitter which came out of the management unit and company’s executive is unwilling to discuss, hints a steep rise in Twitter’s worth.
Twitter raise $200m form a group of investors spearheaded by Kleiner Perkins Caufield & Byers which helped the value of company to $3.7b from $1 b in September 2009.
Twitter introduces its first ad last April, including special messages known as ‘Promoted Tweets’ attracting companies like Coca Cola and Nike. According to eMarketer, an Internet Anlysis company, the company ad revenue may rise up to $150 m current fiscal year.
Over the time there are few changes in the company’s Board of Directors. It has added two seasoned Silicon Valley executives as board of directors and promoted Dick Costolo to CEO from COO. The company now has more than 300 employees and is expanding.
JP Morgan fund has raised about $1.22 billion from outside rich investors till now. Earlier they were expecting funds from $500 m to $750 m. Minimum investment is fixed at about $250,000 and expects to recollect about $13 m in commissions.
Whosoever funds it may be but it is sure that the Cold War between Twitter and Facebook will continue. Probably Twitter following the path of FB.
Cheers!!!
Ethan
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