Small talk is now a very big deal. Twitter, the popular micro-blogging and social-networking site, has entered into an agreement with one or more venture capital firms, valuing the company at a staggering $250 million, according to TechCrunch. ComScore data shows that Twitter logged about 5.57 million users in September 2008, representing an impressive five-fold increase over the year-ago period.
Although the company has achieved mass adoption since it launched in March 2007, Twitter has yet to offer a viable business model; it still hasn't shown how it will generate revenues and sustain profit growth. The company recently turned down a half-billion dollar acquisition offer from Facebook, although most of it would be paid with stock.
"Rumor is Twitter hit up more than a few venture firms to pitch the $250 million valuation, and got more than one 'no'," TechCrunch wrote. "But someone's bit, perhaps encouraged by Twitter's breakneck growth and the interest from Facebook. That means Twitter gets a new cash injection and time to figure out its business model at an even more leisurely pace."
Twitter allows users to send short updates or "tweets" (up to 140 characters long) to the Twitter website, SMS, instant messaging, or third-party application. It's a timely way to update friends, family, or co-workers with the little (sometimes mundane) things that happen throughout the day, such as doing laundry, running late for a meeting, or meeting friends at a party.