Twitter's IPO filing

Twitter: the IPO in pictures

Twitter publicly filed its initial public offering documentation today with the U.S. Securities and Exchange Commission. The short-form social media news company plans to sell 472,613,753 shares and raise at least $1 billion.

Twitter IPO

Twitter lists 31 pages of IPO risks: Revenue concerns, security, and more

While Twitter’s letter to potential shareholders was pithy today, its list of potential IPO risk factors was not.Twitter took 31 pages of its S-1 filing today to list out its stock’s potential risks — Facebook, on the other hand, spent just 20 pages on potential risks when it filed to go public. Twitter’s verbosity today could be a sign that it’s learned from Facebook’s troubled IPO, VentureBeat’s resident Twitter watchdog John Koetsier notes.While Twitter listed the usual risks for similar tech IPOs — a chance that it may lose users, falling advertising rates may cut into revenue — I found the slightly more specific risks more telling.For example, Twitter notes that it has has “incurred significant operating losses in the past, and we may not be able to achieve or subsequently maintain profitability.” It’s a section that seems particularly directed to Twitter’s revenue critics:Since our inception, we have incurred significant operating losses, and, as of June 30, 2013, we had an accumulated deficit of $418.6 million. Although our revenue has grown rapidly, increasing from $28.3 million in 2010 to $316.9 million in 2012, we expect that our revenue growth rate will slow in the future as a result of a variety of factors, including the gradual slow down in the growth rate of our user base. We believe that our future revenue growth will depend on, among other factors, our ability to attract new users, increase user engagement and ad engagement, increase our brand awareness, compete effectively, maximize our sales efforts, demonstrate a positive return on investment for advertisers, successfully develop new products and services and expand internationally.Twitter also points out that as its platform grows, security concerns could open it up to liability issues and a potential loss of faith from users and advertisers.”Our products and services involve the storage and transmission of users’ and advertisers’ information, and security breaches expose us to a risk of loss of this information, litigation and potential liability,” the company wrote. “We experience cyber-attacks of varying degrees on a regular basis, and as a result, unauthorized parties have obtained, and may in the future obtain, access to our data or our users’ or advertisers’ data.”Twitter is also well aware of what its unique position as a global communications platform means: It could face issues dealing with U.S. and foreign laws and regulations, something that could also affect user trust down the line.Ultimately, it’s clear that Twitter wants investors to know exactly what they’re getting into. That’s in stark contrast to Facebook’s S-1 filing, which didn’t go into nearly as much detail (and also couldn’t include some of the shadier aspects of its IPO).

Mark Zuckerberg, Facebook's CEO, wants some TV ad dollars, too.

Not so fast, Twitter: Facebook is also after those TV ad dollars

Facebook is preparing to pitch major TV networks on the benefits of integrating their advertising strategy through conversations on its social network.The move comes just as rival social network Twitter is signing major advertising deals with media companies like the NFL and CBS. Facebook, however, has started sending audience reports to a handful of major networks, like ABC, NBC, Fox, and CBS, as well as a few other smaller partners, according to a Wall Street Journal report published today.Facebook is contending that it can provide much better data about audiences who engage in conversation about a particular television show while it’s currently airing. The reports, which the company won’t share publicly, apparently consist of what a particular audience is doing on Facebook during the show, such as how often they comment, like, or share something with others in their network.Both Facebook and Twitter realize that there’s a huge opportunity to grab a piece of the $66.4 billion in TV advertising that occurs every year. Yet for Twitter, this is very much a big part of its overall business model — especially as it heads into an IPO. Not only has Twitter purchased tweet analytics startup Bluefin Labs for its new Amplify TV ad service, but it’s also partnered up with Nielsen to provide a new standard of accurate TV ratings.But I doubt Facebook’s main motivation is purely based on eating Twitter’s lunch. Facebook’s push to grab attention from media companies is just good business, and it’s something that it should be doing since many people discuss TV shows on Facebook.