The first ever tweet – Jack Dorsey’s ‘just setting up my twttr’ – was sent ten years ago this month. As the anniversary nears, we’re taking a look at how the business has grown since its IPO in November 2013, and what the future looks like for the social media giant.
By the time of its IPO, Twitter had over 204 million users. The explosion in the number of monthly active users (MAU) in such a short time period drew parallels with the rise of another social media success story: Facebook.
An IT glitch at the NASDAQ caused a delay in the trading of Facebook’s shares on the day it listed, and for that reason Twitter decided to list on the traditional NYSE rather than the tech-focused exchange.
Twitter’s flotation was a roaring success, the IPO price which was available to institutions was $26, and the share price jumped over 73% from there on the first day of trading. The company’s top brass like Evan William, Jack Dorsey and Dick Costolo became paper billionaires on the day of the listing.
MAU is a crucial measure of success for social media companies. Twitter’s enormous jump in users from its creation to flotation is certainly impressive, but since listing, the growth rate has been less impressive. Between the first-quarter of 2013 and the fourth-quarter of 2015, the firm added just over 100 million MAU’s and in percentage terms that is nearly 50%.
The last quarter of 2015 showed a small decline in MAUs and that was not received well by investors, especially when you consider that Facebook has in excess of 1.5 billion MAUs.
Being able to monetise your client base is essential for social media companies, and the majority of Twitter’s revenue comes from advertising but the growth of MAUs needs to be strong too.