Research: Twitter has yet to grow into valuation

Unsurprisingly, at least one research company agrees that valuing a company at $1.1 billion before it's unveiled a long-term revenue strategy is a little bit premature.

A firm called Next Up Research released a study this week that estimates Twitter's actual value as somewhere between $526 million and $674 million--or somewhere between 47 and 61 percent of what its valuation was in September when Insight Venture Partners, T. Rowe Price, and other investors pumped nearly $100 million into the company..

The positives for Twitter? It's been able to scale to approximately 70 million users while maintaining a single office in San Francisco and about 80 employees--well, sure, but the fail whale does tend to rear its head--and the fact that you can use it almost exclusively as a low-end mobile application means a whole lot of potential for global reach.

Next Up's concerns are pretty predictable: It's not sure how Twitter will keep up its momentum as it prepares to roll out a revenue model. It spelled out a few options that have been tossed around over the past few years--ads on Twitter.com, ads in tweets, charging for access to its application program interface (API), premium accounts, selling data and analytics--but noted that "most revenue generation options available to the company have the potential to alienate at least some of cult-like Twitter's user base."

Regardless, the research firm is guessing that revenues will come. It's projecting $134 million in revenues in 2013, "in an optimistic scenario." Now let's sit back and see how Twitter does it.

[bugsy3333]

Twitter hits 5 billion tweets. Still waiting for one that matters.

[kgsbca]

So the research firm has no idea what twitter's revenue model is going to look like, yet they project $134 million in revenue in 2013. Based on what? They also provide their valuation of twitter as $600M +/- $74M. My question for Next Up Research is do they use a dart board? a Ouiji board? A random number generator?

That should give people an idea of the value of analyst firms - which is not much more than twitter.

[Shane39199]

heard of a corp called umbrella. here we are folks.its little brother.