How Twitter Found Its Money Mojo | Hacker News Reader

How Twitter Found Its Money Mojo

medium.com

45 pointssteven8 comments

Kudos to Weil on selling the board a business model, media format and engineering roadmap which aligned the interests of readers and advertisers. The article didn't mention that readers can block sponsors, which is a valuable signal to advertisers (quality) and Twitter (relevance).

Hopefully Twitter continues to show every tweet sent by people you follow, carving out their own path far away from Facebook's "algorithmic" decimation of organic traffic.

Until they are in the black, large revenue numbers in and of themselves don't count as "money mojo". Heck, I'll match their financial performance right now. I'll take 1.375 billion in funding and happily return 1.325 billion right back to my investors, with a lot less trouble than twitter has gone through. Any takers?

I suppose if you find there to be no value to the Twitter service itself, that might be a fair proposition.

If you can declare that a company has "found money mojo" based on your valuation of the company, then you can declare if for essentially any company, and certainly any company that has raised money recently.

Amazon's $90 billion in sales of course begs to differ.

A big business that doesn't make money, is still a big business. And $1 billion in sales, is still a lot of sales.

What's not mojo about growing to $1.3x billion in sales in four years of trying to monetize?

Their cost of revenue paints a very clear path to eventual profitability, so long as the userbase holds up.

The thing that's absolutely crazy to me is that Twitter is able to spend so much money. They're going to pull in nearly a billion and a half dollars in a single year and still be able to spend it all plus some? It sounds like nearly half of revenue is spent on stock compensation to employees. Holy shit, no wonder the housing market in SF is going nuts right now.

The day Twitter introduces an algorithmic tweet feed is a sad day. Unfortunately I think it will come.

Why do you think it will come? Promoted tweets can already be repositioned within the feed, there is no need to annoy users by deleting tweets that they want to read, that will simply reduce attention available for advertisers.

Why would Twitter throw away the user goodwill and financial success earned from a multi-year rollout of promoted tweets, by settling for a simplistic pay-to-play protection scheme to extract money from advertisers?

The OP article explains in detail how Weil has focused on targeting to improve relevance and engagement. Such targeting depends on data, which depends on an explicit interest graph. It would make no sense for Twitter to destroy the asset that provides signal to the ad biz.

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