it's always easier to raise money when you don't need it.
Oi, that doesn't necessarily mean it's a good idea. What Twitter desperately need right now is a way to make money (and taking it from VC's don't count). If they want to justify a $1 BILLION valuation, they need a clear way to make a lot of money.
My prediction: they're looking to buy a company that they think will make them money. While one might hope Benchmark Capital might pass down some wisdom from AOL's botched "best acquisition EVAR" fiasco, I have a bad feeling about this. As it stands now, my feeling regarding their technical competence tells me the hypothetical merger will be tougher than anticipated, and history will see Twitter as the shining example of the "Web 2.0 bubble".
Good point. I don't get that sense about the rest of the industry (as much), but twitter seems like a good example of a company which is "breaking the heuristics" - they got wildly popular via SXSW, which has many influential minds, but also hugely inflates the growth-to-usefulness ratio. They used that bump to raise enough money to do enough PR to get Oprah and half of Hollywood on board. This let them continue growing until this coming valuation. Throughout, they've struggled technically, leaked documents, and just haven't polished their UX enough.
Facebook and Google, on the other hand, have been growing out of being useful to their users, with no comparable technical issues (I'm hoping the FriendFeed acquisition does some good things for Facebook's architecture).
Probably not. I don't particularly care about a single company, but they are not going to mark the end of a bubble. It might be the beginning, but we have yet to see sentiment and valuations that would lead me to believe that a crash in tech is coming soon.
> If they still have 30 million in the bank of the 55 million, why are they raising more money?
Answer: it's always easier to raise money when you don't need it.