Acquisition Dance Between Facebook And Twitter Over For Now?
Update: while Twitter CEO Evan Williams declined to comment on the rumors, we’re hearing that 20 percent of the offer that was made was in fact cash (which would mean $100 million in cash and $400 million in stock).
Apparently talks, which were reportedly initiated by privately-held Facebook, broke down because of doubts on behalf of Twitter investors and executives about the stock’s actual worth, the usual concerns that arise when acquisitions are made (like integration, duration, costs, etc.), and a strong belief that Twitter will ultimately be able to weather the economic downturn on its own. Also noted is Facebook’s concern over Twitter’s current burn rate and future revenue potential.
At the recent Web 2.0 Summit, moderator John Battelle asked Mark Zuckerberg on stage if Facebook would be interested in buying Twitter. The young Facebook CEO’s response was: “we’re really impressed by what they’ve done”, and that they have “a very elegant model”.
We’re trying to get more out of the companies and will update this post if there’s anything else to add.
For comparison: Facebook has raised $516 million in funding to date, while Twitter is backed by $20 million in investment. Twitter boasts 6 million active users, while Facebook reports more than 120 million.
Noteworthy caveat: serial entrepreneur and angel investor Marc Andreessen is sitting on both sides of the fence, being both an early investor in Twitter and a member of Facebook’s Board of Directors.