A good reminder: TechCrunch says Twitter’s getting more investment money, and at a $250 Million Valuation to boot. And Twitter doesn’t make money. It just keeps getting more use, and from more users.
What’s this mean?
- Big winners can still get more money.
- Some of those big winners are still on the investment musical chairs track. Get investment money, spend it, then get more money at a higher valuation. Without ever getting money from customers (users, advertisers, sponsors or whatever) as normal revenue. Twitter’s a great example.
- But caution: This is more money, which is not the same as the first money. Twitter’s already there, and some people with money think it’s worth a lot of money. One way to get more investment is to already have investment. That gives investors a vested interest in keeping you going.
The lack of a revenue model tempts me to post about bubbles and such. I’ve been fooled before by the idea that traffic is worth money. Even so, I still think that at some of these very big winners, such as Twitter and Facebook, traffic is worth money.
I’m keeping my fingers crossed. I’d like to see Twitter make it. I like to use it.
Tim Berry is the founder and chairman of Palo Alto Software and Bplans.com. Follow him on Twitter @Timberry.
