San Francisco – Twitter publicly announced its intention to file for an IPO with a tweet yesterday afternoon.
“We’ve confidentially submitted an S-1 to the SEC for a planned IPO,” stated the tweet. “This Tweet does not constitute an offer of any securities for sale.”
According media reports, Twitter has 200 million users and secondary sales of its stock have valued the company as high as $10 billion. Securities and Exchange Commission (SEC) regulations limit confidential IPO filings to companies with less than $1 billion in annual revenue, giving some indication of Twitter’s actual current earnings. Twitter does not have to immediately file for an IPO and can keep all related documents confidential until 21 days before it starts formally pitching the IPO to major Wall Street investors.
Twitter is increasing in importance as an e-commerce tool. The recent second quarter 2013 Monetate E-commerce Quarterly indicates Twitter experienced the fastest growth among all social networks in referrals to e-commerce sites, moving from 5.4% of social referrals in second quarter 2012 to 9.64% in second quarter 2013 – a 77% gain. In addition, Twitter recently hired former Ticketmaster president Nathan Hubbard to take the new role of head of commerce and reportedly plans to enable direct shopping through postings within tweets.