The analyst reported that the social networking site Twitter needs a massive infusion of cash to fuel its global expansion and challenge the other social sites likes Facebook Inc (NASDAQ:FB) and Google. According to the report Dick Costolo delivered a short Speech on leadership only days before telling the world that his company had decided to sell stock to the public.
Costolo spent its last two years sharpen his ability to transform an incomplete start-up into a successful publicly traded business that can compete with digital giants Facebook and Google.
Analyst think that it’s not yet clear whether the effort will pay off to the Twitter or not but one thing is certain that in-order to be in the same league as Facebook Inc and Google Inc. Twitter needs a massive induction of cash to fuel its global expansion and challenge much larger pocketed competitors. Max Wolff economist reported that the Twitter needs cash to keep innovating and to add new features or literally they are going to get knocked out of the game.
Analysts expected Twitter to raise more than $1 billion in its IPO, which would make it easier to compete for acquisitions. The IPO is expected to be the largest technology offering then Facebook, which also provide employees and investors an easy way to sell some of their shares.
Twitter could have raised money through private stock sales that let insiders cash out. A survey on Survey Monkey reported that company raised $444 million last year from investment firms and took on $350 million in new debt financing arranged by JPMorgan Chase, avoiding the costs of a public offering and the demands of operating as a public company.
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