The Social

LOS ANGELES--Twitter didn't rake in $100 million because it was about to run out of money, investor and board member Bijan Sabet of Spark Capital said in a panel at the 140 Conference on Tuesday morning.

There was still money left over, Sabet explained, from what the company had raised from Benchmark Capital and Institutional Venture Partners in February, which followed Twitter's Series C round in the spring of 2008. Twitter, according to Sabet, raised the money from Insight Venture Partners and T. Rowe Price last month because it wanted to grow up: hire new people, launch new products, strike partnerships, and the like. Contrary to Twitter's reputation for "fail whale" errors, Sabet insisted that the money wasn't needed for an emergency server shopping spree or anything. (Some may disagree.)

"The expectation when you raise a lot of money, it's a statement that you want to build a company, an independent company," Sabet said when moderator Robert Scoble asked him what he thought of the fact that Twitter has not yet put forth a long-term business model. "We didn't need the money...it was a very purposeful kind of commitment to try to make a company."

A billion-dollar valuation is pretty nice to have, too.

A correction was made at 2:13 p.m. PT: a source with knowledge of the deal confirmed that Twitter's April 2008 and February 2009 rounds of funding are considered to be separate rounds.

Evan Williams (left) and John Battelle (right)

(Credit: James Martin/CNET)

SAN FRANCISCO--In anticipation of an onstage interview with Twitter CEO Evan Williams at the Web 2.0 Summit on Tuesday afternoon, conference organizer and Federated Media CEO John Battelle told the audience to expect "a surprise" during the talk.

Turns out that "surprise" was actually a recently unearthed video clip of Williams in 1994, explaining the Internet on behalf of a company called Illumination Labs and sporting a haircut that looked like it belonged on the set of '90s alterna-teen flick "Empire Records." (No, we don't have a snapshot of it yet.)

Williams didn't really say a whole lot else about where Twitter's going, beyond what the world already knows: it's been growing fast. It turned down a buyout offer from Facebook. It just raised a ton of money. It still hasn't disclosed a long-term revenue model.

Evan Williams

(Credit: James Martin/CNET)

"It's not like we're spending our days looking in the couch cushions for the elusive revenue model, but obviously we've done a lot of thinking about it," Williams said, declining to comment on the potential of search deals with Google or Microsoft. "I can't tell you exactly what the model is, but it's pretty obvious to you that there may be some advertising that makes sense...there's a lot of commercial activity on Twitter today, there's a lot of brand marketers who use Twitter today, and it works. We think of Twitter (as) not a social network, it's an information network...a substantial part of that is commercial and theoretically monetizable information."

Williams, who previously founded Pyra Labs and sold its flagship Blogger product to Google, took over as CEO of Twitter from fellow co-founder Jack Dorsey last year. Dorsey, who remains Twitter chairman, is working on a new mobile commerce start-up called Square.

In his talk at Web 2.0 Summit, Williams mentioned new features like user-generated "lists," currently in beta, and said that they may end up replacing the site's current (and much-maligned) "suggested user" list altogether. ("It's gone on too long, and I desperately want to kill it or evolve it.") He also said that "some things we're launching" may counteract recent slowdowns in Twitter's U.S. Web-based traffic, which was growing exponentially not so long ago.

"We are seeing slowing of growth in some areas and accelerating growth in other areas. Twitter is very hard to measure, even for us," Williams said. "The biggest two areas that we're seeing growth is on mobile and internationally." Last week, the company inked new mobile deals in India and Japan; currently, its five biggest markets are the U.S., the U.K., Japan, Brazil, and Indonesia, which has been "growing like crazy lately."

So what does he think of the other players in the real-time Web? He's not sure what to make of Google Wave ("I sure as hell don't know what Google Wave is going to be. I haven't wrapped my head around it yet") but underscored that in Twitter's early days he wasn't sure what that would turn out to be either. And as for Facebook, he shrugged off speculation that the social-networking giant started aping Twitter when it was unable to actually buy it.

"I don't know how Facebook's feature prioritization works. I suspect that they came to a lot of the same conclusions we did," Williams said. "In the global sense, I'm pretty sure the world is big enough for Facebook and Twitter, and fundamentally I think they're good at different things. Facebook is phenomenal at communications among people who know each other."

Facebook ultimately purchased a far smaller streaming-information start-up, FriendFeed, this summer.

"We had a few conversations with our friends in Palo Alto (Facebook) and ultimately I just didn't see a reason to sell if that opportunity would have presented itself because it's not the point," he continued regarding the failed acquisition. "The point is really to see what we can build. We believe very strongly in that at Twitter, and enabling the open exchange of information is a good thing for the world."

It's his usual schpiel. Aside from the Nirvana-era haircut, there wasn't a whole lot to tweet about here.

Former Current Media executive Robin Sloan appears to have posted Twitter's 5 billionth tweet, in the form of a reply to another user that otherwise read only "Oh lord."

A third-party app called Gigatweet has been measuring the service's total tweet count for some time now, and last week some onlookers picked up on the fact that it was getting awfully close to five billion. That said, Twitter's engineers have bumped up this number at least once or twice, and who knows how many test tweets were sent out in the company's early days.

But Sloan's tweet, which he has nicknamed "The Pentagigatweet," does get at least some landmark status because it actually has the number 5,000,000,000 in the URL. That's because the number at the end of a tweet's URL is apparently the running count of tweets that have been posted until that point. We've e-mailed Twitter co-founder Biz Stone for more information and will update if and when we hear back.

The guy who posted Twitter's 5 billionth tweet.

(Credit: Robin Sloan's Facebook profile)

It's sort of fitting that Twitter's 5 billionth tweet came not from one of the celebrities or marketers who have flooded the service in recent months, but from one of the quirky Bay Area dot-com nerds who formed its first loyal pack of users.

Sloan, who lives in San Francisco, recently departed his gig at Current--which is headquartered only a few blocks away from Twitter's own home base in the South of Market neighborhood--to write a still unnamed novel" that he is funding through creative-microfinance site Kickstarter.

He may have just gotten a convenient leg up in publicity.

Meanwhile, some third-party observers have been remarking that Twitter's rapid growth may be slowing down. The company recently raised another round of funding at a valuation somewhere in the neighborhood of $1 billion.

This post was expanded at 10:20 p.m PDT.

Correction at 2:25 p.m. PDT Tuesday: This post initially referenced an incorrect title for the novel Sloan is working on. The novel is still unnamed.

Something has dammed the Twitter river. I bet it was this guy.

(Credit: Creative Commons licensed: flickr.com/photos/sherseydc)

Holy cow. Is nothing on the Internet working these days? Facebook's acknowledged that a number of members have had account maintenance issues, and now Twitter has confirmed that "many" users are experiencing timeline delay problems.

Basically, the lowdown is that you can post tweets, and they'll publish, but that your timeline--the stream of updates from the Twitter accounts you follow--isn't bringing up any new tweets. For me, it looks like this started at around 8:00 a.m. PT.

Twitter, which has been prone to many an outage in its three-year history, says it is investigating the problem and will provide an update shortly.

(Photo by Flickr user sherseydc, licensed under Creative Commons).

Yes, Twitter's megacash infusion is real. CEO Evan Williams confirmed on the company blog Friday that Twitter has raised a new round of investment from Insight Venture Partners, T. Rowe Price, and existing investors Institutional Venture Partners, Spark Capital, and Benchmark Capital.

Williams says it's "a significant round." He didn't say just how close it was to the roughly $100 million that The Wall Street Journal reported Thursday. Nor did he say whether this values Twitter at $1 billion.

"It was important to us that we find investment partners who share our vision for building a company of enduring value," Williams wrote in the blog post. "Twitter's journey has just begun, and we are committed to building the best product, technology, and company possible. I'm proud of the team we've built so far, and I'm confident in the future we'll build together."

Before the end of the year, Twitter is expected to start rolling out paid corporate accounts to businesses that use the service for marketing, promotion, and customer service.

Twitter's long-anticipated business plan had better be close on the horizon, because according to the Wall Street Journal, the site has some new investors on board: Mutual fund T. Rowe Price, Insight Venture Partners, and a handful of others have reportedly pumped $100 million into the microblogging phenomenon.

TechCrunch reported last week that Twitter was putting together a round of funding at around a $1 billion valuation. But that report suggested that the company would do so by raising about $50 million--half of what it actually has, per the WSJ, in a deal expected to close Thursday.

Twitter still doesn't make significant revenue. But its founders have said that paid corporate accounts, in the form of a sort of "analytics dashboard," are imminent. Advertising isn't out of the question either, despite what some of the company's executives have said in the past.

The company's initial round of Series B funding last year valued it at about $80 million, but soon added to the round in a deal that upped the valuation well into the hundreds of millions.

Twitter recently changed its default user avatar--you know, the one that pops up if you haven't uploaded a picture of your own--to a cute little bird icon. Unfortunately, then the service got a little bit overzealous and started chomping up existing users' photos, replacing them with the defaults. Oops!

"Many people in my timeline suddenly have default user icons," Twitter engineer Alex Payne posted to his Twitter account on Thursday. "This is probably not intentional. I have inquired with colleagues."

By the time the end of the day rolled around on Friday, there were still plenty of missing user avatars.

"We're having an issue with disappearing user and background images," Twitter wrote on its status blog on Friday morning. "Those affected will have their custom images replaced by defaults. This is due to a caching error on our side which means that your images are not lost and have not been deleted. They are not displaying correctly and we are working to get them to load properly."

This is the second time that a disappearing-user-avatar incident has occurred on Twitter this year. Back in April, infrastructure problems resulted in many Twitter user icons temporarily disappearing--including CEO Evan Williams'. It's unclear whether the same or a similar error downed avatars this time around.

A mockup of Twitter's new 'retweet API' interface

(Credit: Twitter)

The development team at Twitter has released a mockup of its forthcoming "retweet API"--basically, the first formal way that Twitter has baked retweets, the copying and attribution of other Twitter users' posts, into its own product. It displays the user avatars of members who have retweeted a given tweet below the original, "collapsing" them into a single space.

Some background detail on the forthcoming new API: Retweets have been a mainstay of Twitter for some time now, but the feature was created by users rather than officially. Several third-party Twitter clients have built in retweet buttons, and some apps, such as Tweetmeme, have created a way to tabulate them like a Digg count, but it's never been worked into Twitter's Web site or API.

What's interesting is that the new format, assuming that this is how the timeline ends up looking, can provide a quick, one-glance way to see just how influential a given Twitter user or individual tweet is, adding a new dimension to measuring Twitter influence beyond the follower count. If you see a lot of little retweet icons, for example, you might stop and take a closer look at a tweet (or the user behind that tweet) that you might otherwise have skimmed past.

What's also interesting is that it looks like retweet counts get cut off at 100, with higher ones displayed as simply "100+." I'm guessing that, say, CNN Breaking News generally gets a lot more than that.

When they were announced, the changes to Twitter retweets weren't met with a thoroughly warm reception. "Asking developers to collapse retweets in timelines is onerous, complicated, and confusing," the forum post by Twitter's Marcel Molina said in response to developer concerns that the collapsed-retweet format would do more harm than good. "We're not going to do it that way. We are going to add a resource that gives you all retweets for a given tweet. In timelines, you will get only the first retweet. You can then request all retweets for that tweet at any time to get up to 100 retweets that have been created for it."

Well, it looks like Twitter will actually do it.

In an interview with VentureBeat on Thursday, Twitter co-founder Biz Stone elaborated on the company's goal to put out a revenue model before the end of the year. He said that yes, it will involve offering paid accounts to businesses that use the microblogging platform for marketing, customer relations, publicity, and what-have-you. That's something Twitter has been hinting at for about a year now.

There's not a whole lot of detail available. But paid accounts will definitely involve statistics and analytics that aren't available through Twitter's existing application program interface (API), and possibly a whole separate "commercial API" for business-related applications. This adds to a move earlier this year in which Twitter started rolling out an account verification process for prominent users.

In fact, Stone told Marshall, the first test phase of these accounts is already under way with a few companies. Considering Twitter's status as marketing heaven, this is probably a product that will sell quite well. And since Twitter, which has raised $55 million in venture funding, has yet to turn a profit, that's good news.

Marshall points out something important: "It might be hard to tease out who is using the service professionally and who is using it for personal reasons, and then charge them for it. So the idea is to build a set of features that people are willing to pay for." Stone made it pretty clear in the interview that ordinary Twitter users won't be forced to pay up.

Another interesting tidbit: Stone said that Twitter had been looking to acquire social-network aggregator FriendFeed, which was picked up by Facebook earlier this month.