Twitter adds to the nest with $35-million funding round
When you're San Francisco's hottest start-up, you don't need to look for funding. The money comes to you.
Twitter closed a $35-million venture capital round that was co-led by Institutional Venture Partners and Benchmark Capital, IVP said today. It had previously raised $5 million in 2007 and $15 million last year, according to CrunchBase.
In a blog post titled "Opportunity Knocks," Twitter co-founder Biz Stone outlined the reasons for taking "an offer we couldn't refuse."
"We weren't actively seeking more funding because significant capital from last year's partnership with Bijan and his team at Spark is still in the bank," wrote Stone, referring to Bijan Sabet, a partner with Spark Capital. "Nevertheless, our strong growth attracted interest and we decided to accept a unique opportunity to make Twitter even stronger with a very attractive offer."
Stone, who of course also tweeted the news, wrote in the blog post that Twitter's active user base had grown by 900% in the last year. The company's Web traffic was "amazing" too, he wrote, but it was far outpaced by the traffic to its APIs (the tools Twitter makes available to outside programmers). That's more proof that Twitter's growth has been powered by a thriving ecosystem of developers who create programs that make the service more useful, such as Twhirl, Tweetdeck and Tweetie.
Stone said the funding boost would go toward expanding Twitter's 29-person staff, "and yes, to begin building revenue-generating products." That's Twitter's most famous challenge: figuring out how to pull in money not just from venture capitalists, but from everyone -- or anyone -- else.
-- Mark Milian