$800-million worth of fresh funding for Twitter

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In a blog post modestly titled “Your world, more connected” Twitter announced on Monday it has closed a deal for a “significant” round of new funding led by Russian investment company Digital Sky Technologies (DST).

Twitter did not reveal the amount raised for the wildly popular real-time microblogging service but based on reports from tech site All Things Digital, speculation has placed the deal to be worth US$800-million, pushing the value of the company up to US$8-billion.

According to AllThingsD, US$400-million of the total investment will go to the company and US$400-million will be used to cash out current investors and employees.

In the blog post, Twitter said it has grown from 250 people a year ago to 600 and was delivering 200-million tweets a day, up from 65-million a day a year ago.

“We’ve come very far in a short time”, the San Francisco-based company said.

“Now we have an opportunity to expand Twitter’s reach with a significant round of funding led by the venture firm DST Global, with the participation of several of our existing investors”, it said.

“We will use these resources to aggressively innovate, hire more great people and invest in international expansion”, Twitter said. “We can’t wait for you to see what we have planned to make Twitter even better.”

DST, owned by internet tycoon Yury Milner, has also made investments in Facebook, Swedish online music service Spotify, daily deals site Groupon, and Zynga, creator of the popular online games such as “FarmVille”.

Milner, in a statement, described Twitter as “one of the few companies that has truly changed the world”.

“Twitter’s astonishing growth is a testament to how important it is becoming to more people every day, and why we couldn’t pass up the chance to be a bigger part of its future”, he said.

Twitter has enjoyed explosive growth since it was founded in 2006 but it is unclear how successful it has been in translating its popularity into profit.

Twitter chief executive Dick Costolo, speaking at the Fortune Brainstorm Tech conference in Aspen, Colorado, last month, declined to reveal whether the privately held company is profitable.

But he said the number of advertisers on the platform is up 600 percent this year over last year, when it numbered in the hundreds. — AFP

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