Twitter, the social-network outfit that made 140 characters famous and turned millions of us into tweeps who tweet (I’m @jontalton), is preparing for its initial public offering. Its prospectus, made public on Thursday, revealed that it has been steadily losing money, has yet to turn a profit, and has seen user growth slow since the end of last year even as mobile advertising is increasing.
There’s little question that an IPO will make the company’s executives and investors rich. But will it succeed as a publicly traded stock? Last year, Facebook went public and flopped before beginning a steady climb since the summer. Don Dion of DRD Investments writes on Seeking Alpha that Twitter will work to avoid Facebook’s IPO blunders and that aggressive investors should buy this “exciting” offering. But he also noted:
Questions about the structure of the company have surfaced, regarding the competence of the engineering team that was entrenched since the company’s start and their choice of team members along the way. Some ex-employees have noted that this leadership system made it impossible to rise in the company. Other problems with rumors that leak from high leadership positions cause concerns whether the company is ready for the changeover. However, as with any tech company, Twitter is likely to make necessary changes quickly, if reluctantly, in future years.
What do you think?
Read on for some of the best business and economy stories of the week, and the haiku…
This Week’s Links:
• Where poor and uninsured Americans live — and where Medicaid won’t be expanded (interactive map) | NY Times
• Will financial markets crash before October 17th or after? | Jeff Frankel
• Smaller aerospace companies most at risk from U.S. shutdown | Flightglobal
• The end of convergence? | Project Syndicate
• Wealth patterns and retirement readiness | Tim Taylor
• Some economic consequences of the shutdown | NYT Economix
• The loss of U.S. preeminence | Simon Johnson
• Repealing the medical-device tax: The plan to give GE more money | Beat the Press
Today’s Econ Haiku:
The board whacked Ballmer
Good corporate governance
Hope that doesn’t change