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Twitter Falls Below IPO Price as Concerns Mount Over CEO, Growth

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Re: Twitter Falls Below IPO Price as Concerns Mount Over CEO, Growth

#71

Post by walterbell »

digisth wrote: post #67
mikegioia wrote: post #29

To me the problem with Twitter lies solely with what Twitter's logged-out homepage looks like. I don't know what it's trying to be but asking me to sign up, browse categories (?), and read top celebrity posts is not it. Why is logged-out Twitter not a search engine? They have up-to-the-second thoughts from their users about everything and it's the first place I go when a site is down, or some news story is breaking.…

That's part of it. Another is a lack of good curation features, as Chris Sacca has written about ( http://lowercasecapital.com/2015/06/03/what-twitter-can-be-2... ) I also thought about this when I started building Testimote. A lot of interesting things are being said (positive things about companies in my case), and are drowning out there in the great torrent coming from the firehose. I think there's room for both T…

Twitter blocked Flattr from providing micropayments based on favoriting, then failed to fill that gap in the market. There are so many gaps which could have been filled by 3rd-party developers, but Twitter's API posture scared away investors from building on their API.

Re: Twitter Falls Below IPO Price as Concerns Mount Over CEO, Growth

#72

Post by mkr-hn »

freehunter wrote: post #59
nuclear_eclipse wrote: post #42

Earlier quoted context omitted.

> "Niche is Instagram" Except Instagram has more active users than Twitter...

When was the last time you saw a business with nothing but an Instagram profile, or saw Instagram referenced on the news, or cited in a paper, or used for a press release? It's not about active users, it's about how it's used.

Everyone had an AOL keyword. AOL isn't dead, but it fell hard. Ubiquity isn't enough.

Re: Twitter Falls Below IPO Price as Concerns Mount Over CEO, Growth

#73

Post by adventured »

JumpCrisscross wrote: post #20
hatred wrote: post #12

Earlier quoted context omitted.

Twitter had a Q1 revenue of $436 million. Doesn't it make it a $X0 billion business or am I missing something ? The main concern to investors is primarily the growth and their ability to warrant a premium price on the stock.

> Twitter had a Q1 revenue of $436 million They're also consistently losing money. Even if you strip out half their capital expenditure or 3/4 of their R&D from their FY 2014 numbers, they would still lose money. Let's say they can eventually run a 20% net income margin. This would turn their 2014 revenues into $280MM of earnings. Using the S&P 500's 21x P/E ratio, this values the business at $6bn. That's 70% less th…

Twitter could be very profitable. They're running the business extraordinarily poorly. They have 36% of the head count of Facebook, with 12% the revenue.

They're at $1.77b in sales the last four quarters. At the clip they're growing sales, they could certainly get to $3.5 billion in two years. If they ran the business properly, instead of pretending they're Facebook, they could generate $700 to $800 million in profit (purely in my opinion) two years from now. They'd get a rich valuation (Facebook is currently 90 times earnings); even half the valuation of Facebook would get them to $30 billion in market value two years from now, backed with real earnings.

Re: Twitter Falls Below IPO Price as Concerns Mount Over CEO, Growth

#74

Post by swingbridge »

dlubarov wrote: post #70
code4tee wrote: post #38

Earlier quoted context omitted.

Businesses are usually valued on reasonable (e.g. 12-18x) multiples of their profit (and by that it's their actual profit not these silly non-GAAP 'profit if you ignore all this stuff we don't want you to look at' profit nonsense). Tech companies often try to pretend this isn't reality, but after you've been trading on the public markets for a while reality starts to set in hard. So for Twitter to be a legit business…

12-18 is a reasonable P/E range by historical standards, but not in the present environment. S&P 500's overall P/E is over 20 right now.

Fine, take 20-30. Twitter is still light years off those numbers.

Re: Twitter Falls Below IPO Price as Concerns Mount Over CEO, Growth

#75

Post by bluepostitnote »

icpmacdo wrote: post #11
freehunter wrote: post #6

Earlier quoted context omitted.

When I think of twitter I think nothing but mainstream. There are two platforms that anyone who is anyone (celebrity or business or politician) needs to have: either Facebook or Twitter. Niche is Instragram. Niche is Snapchat. But when Kardashian is on CNN once an hour because of a tweet, it's not niche. App.Net is niche. Twitter is the epitome of mainstream.

I think thats the main problem with Twitter, saturation. Its mainstream enough the regular people are not likely to jump on Twitter now if they already haven't.

And yet Facebook is still signing up users

Re: Twitter Falls Below IPO Price as Concerns Mount Over CEO, Growth

#77

Post by digisth »

walterbell wrote: post #71
digisth wrote: post #67

Earlier quoted context omitted.

That's part of it. Another is a lack of good curation features, as Chris Sacca has written about ( http://lowercasecapital.com/2015/06/03/what-twitter-can-be-2... ) I also thought about this when I started building Testimote. A lot of interesting things are being said (positive things about companies in my case), and are drowning out there in the great torrent coming from the firehose. I think there's room for both T…

Twitter blocked Flattr from providing micropayments based on favoriting, then failed to fill that gap in the market. There are so many gaps which could have been filled by 3rd-party developers, but Twitter's API posture scared away investors from building on their API.

Hopefully, they'll reconsider some of those policies now. We know the data (including certain event data, like favoriting, like you say) is probably their most valuable asset, but opening the valve on it a bit more would be in everyone's interest, I think.

Re: Twitter Falls Below IPO Price as Concerns Mount Over CEO, Growth

#79

Post by shostack »

mikegioia wrote: post #29

To me the problem with Twitter lies solely with what Twitter's logged-out homepage looks like. I don't know what it's trying to be but asking me to sign up, browse categories (?), and read top celebrity posts is not it. Why is logged-out Twitter not a search engine? They have up-to-the-second thoughts from their users about everything and it's the first place I go when a site is down, or some news story is breaking.…

I've long wondered this. I haven't followed the evolution of Twitter's homepage, but I'd be really shocked if they hadn't tested this to death.

The thing is, this keeps causing me to miss moments to engage with them. Someone posts a link, I find something on a website, etc. that go to Twitter? BAM! SIGN-UP NOW OR LEAVE!

While I do of course have an account, if I were a non-user, I'd keep thinking "why would I sign-up when I have no idea if it is worth my time to be nagged by you via email?"

There's a well understood notion that on user-generated content sites like Twitter, Reddit, etc. the number of content producers is relatively low compared to the number of content consumers. While I don't have data to support my hypothesis on this yet, my gut tells me that you have a better chance of converting people to content producers if you can get them hooked on being a content consumer. Lowering the barrier to entry for that is critical. If I felt like I was really missing out on all the cool stuff going on within Twitter, I might be more inclined to sign up if I hadn't yet, and exposing that data lowers the barrier to entry.

But again, I'd be shocked if they hadn't tested that to death.

Re: Twitter Falls Below IPO Price as Concerns Mount Over CEO, Growth

#80

Post by grok2 »

Greenisus wrote: post #3

"At stake is whether Twitter [...] can become a mainstream platform instead of a niche forum favored by journalists and celebrities." I found that line interesting, because I often think of Twitter as a niche forum favored by technology workers and celebrities.

Actually it is a fantastic platform for businesses to reach out to people interested in their business. It is the easiest way to do the equivalent of cold-calling and introduce your business to someone you are interested in selling to. I have always thought they don't do enough on this front to mine the possibilities here.
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