Twitter flies the nest...

#Ring ….Twitter rung the bell at the New York Stock Exchange yesterday. This makes it the second largest US internet company to IPO on record, behind Facebook ($16bn) and ahead of Google ($1.9bn).

Top 3  US internet IPOs on record (money raised)

  1. Facebook - $16.0bn | Nasdaq | May 2012
  2. Twitter - $2.1bn | NYSE | Nov 2013
  3. Google - $1.9bn | Nasdaq | Aug 2004

There was huge institutional and retail demand for Twitter stocks, the IPO was priced at $26  shares closed the first day of trading up 74% at $44.95.  This underscores what many analysts have been saying for some time, that right now the IPO market is hotting up and investor appetite for innovative businesses is high.

Coincidently, on the eve of Twitter’s IPO the securities exchange commission (SEC), US regulator, warned that technology companies with lots of users will not always translate into large profits. Like its recent internet based predecessors who have come to market it remains to be seen if this non-profit making organisation can really deliver returns to its new shareholders and not just its existing owners.

Market commentators have already started to question whether the tech bubble is back, again only time will tell. Being an optimist I believe that successful IPOs like Twitter’s only serve the market well and create a renewed confidence and boost to activity.  As a considered individual I (one of those “twitter watches” if you will) will take a step back for the time being and wait to see how investor appetite develops over a longer period as Twitter demonstrates how  it will monetise its platform  to deliver shareholder value.

As we embrace the digital age and social media communications it does make me wonder what ever happened to writing letters or even calling someone…but for now I guess all I can say is watch this space and happy tweeting!

Clifford Tompsett | Head of IPO Centre
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