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Twitter Seen Valued at $10 Billion Based on GSV Holding

By Ari Levy and Douglas MacMillan
May 11, 2013 12:01 AM EDT 2 Comments
Twitter Said to Be Valued at $10 Billion as GSV Reports Holding
Twitter Said to Be Valued at $10 Billion as GSV Reports Holding

Twitter Inc. was valued at almost $10 billion by one of its investors, up about 10 percent from a previous estimate, indicating shares are appreciating ahead of a possible initial public offering for the microblogging service.

GSV Capital Corp. (GSVC) owns 1.9 million shares of Twitter valued at $35.2 million, or about $18.50 a share, the firm said in a May 8 filing. Based on a fully diluted share count of almost 530 million, that makes the company worth about $9.8 billion.

Twitter is becoming more valuable as the San Francisco-based social website boosts revenue from advertising and moves closer to a predicted IPO. In January, Twitter was valued at about $9 billion when a fund managed by BlackRock Inc. (BLK) bought stock from employees, up from the $8 billion valuation in a 2011 investment round led by DST Global, people with knowledge of the matter have said.

Michael Moe, GSV’s chief executive officer, declined to comment. Gabriel Stricker, a spokesman for Twitter, didn’t respond to a request for comment.

GSV, based in Woodside, California, is a publicly traded investment fund that primarily buys shares of closely held technology companies on the secondary markets. The firm first sold shares to the public in April 2011.

The fund reported total assets of $245.4 million at the end of March, and Twitter is the biggest holding, accounting for 14 percent of assets, GSV said in the filing. That includes $34 million of common stock and $1.2 million of preferred shares. The next-biggest holdings are Palantir Technologies Inc., Dropbox Inc. and Chegg Inc.

Twitter, founded in 2006, is offering new forms of advertisements and expanding to international markets in its bid to reach $1 billion in revenue in 2014.

While Chief Executive Officer Dick Costolo has said that management isn’t concentrating on an IPO, Twitter is widely predicted to hold a share sale before long to help it bankroll expansion, and give early investors a way to realize financial gains on their holdings.

To contact the reporters on this story: Ari Levy in San Francisco at alevy5@bloomberg.net; Douglas MacMillan in San Francisco at dmacmillan3@bloomberg.net

To contact the editor responsible for this story: Tom Giles at tgiles5@bloomberg.net

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