*Twitter raises $100m

There's no immediate cash crunch, but the messaging Web site (that's how the WSJ describes it) is clearly looking to play catch-up with Facebook - and in the process to make the company more attractive to potential advertisers. On that point, Twitter, Facebook and all the other social networking sites face the same challenge. (It's a point addressed in my piece on MySpace that appears in the October issue of Los Angeles magazine.) The new Twitter investors include Insight Venture Partners, a NY venture capital firm, T. Rowe Price, and the current Twitter backers Spark Capital and Institutional Venture Partners.

Perhaps more noteworthy than the additional $100 million is the company's revised valuation of $1 billion. From the WSJ's Deal Journal:

A person familiar with the deal said investors are applying a similar value to Twitter as that applied to Facebook, which at one point was valued at $15 billion. By some estimates, Twitter is expected to have 25 million users by the end of 2009. Facebook has 300 million users.

*My LA magazine column isn't available online, but Here's a relevant snippet from LA magazine piece:

So far, users of social networking sites aren't tuned into ads, which is why the click-through rate has been so low. "Television advertising is mass to mass," says Chris Anderson, editor-in-chief of Wired magazine. "Coke ad against American Idol. OK, but what do you put against a cat video? What do you put next to your favorite soldering video?" In talking to a bunch of experts in the social media world--smart, ambitious entrepreneurs who deal with these kinds of questions all the time--I kept hearing the same three letters: TBD. I'm not a big fan of To Be Determined strategies; it's an unsettling throwback to the tech boom of the late 1990s, when other smart, ambitious entrepreneurs insisted that it was all right not to have a business model and to lose gobs of money because in due course profits would keep pace with concepts.

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Mark Lacter
Mark Lacter created the LA Biz Observed blog in 2006. He posted until the day before his death on Nov. 13, 2013.
Mark Lacter, business writer and editor was 59
The multi-talented Mark Lacter
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