Twitter is gearing up for an IPO. Folks are looking for some liquidity and Twitter is looking to diversify their revenue streams. After all, nobody wants to repeat that Facebook pre IPO roadshow where their lack of a mobile strategy nearly screwed everything up. Facebook has a great mobile strategy now and they nabbed a (seemingly non integrated) Instagram from under Twitter’s nose for a cool $1B.
So you’re Twitter, you’ve gone and acquired Vine which is doing great (unless you’re on Android that is), oh, and you’re working on some high level deals with broadcasters to include video in tweets. Life is great! All this ties into your push to cardify the Twitter experience and become the realtime portal to the rest of the web. Great strategy, especially since cards work really well in the mobile space. Odds are good you’ll be getting a great deal on those stock options when the IPO rolls around.
Bad news this week though. WhatsApp, recently rumored to be in Google’s cross hairs for that same cool $1 billion, now says it’s bigger than Twitter. The claim may or may not be true but they’re boasting over 200 million users and billions of messages delivered today. Multimedia messaging apps are the hot thing in social media; Facebook gets it ala Chat Heads and Facebook Home and Google gets it ala Babel and potentially trying to buy WhatsApp so why doesn’t Twitter get it?
Have you tried using Direct Messages for a private conversation? It’s terrible! And I am more than happy to have many conversations in the open on Twitter, in fact sometimes I enjoy throwing inside jokes out there, but I’m not going to waste my time on DMs when I can use a million other apps for messaging. The bottom line, I get in and get out when using Twitter. Maybe that’s what they want, maybe they don’t want to cannibalize public sharing by offering a better private sharing alternative, but I’d be hard pressed to believe that. User engagement is everything.
I’ve got an idea, a good one if you ask me. Make a cheap purchase that should integrate quickly with existing products. The perfect situation for an acquisition, right. Another messaging startup made news in the last few days: Kik. Why Kik? Well they did just hit 50 million users but Twitter doesn’t need a quick a land grab, this is about strengthening the Twitter experience and Kik has 2 big pluses. First and foremost they’ve built their card feature with HTML5 which means integration couldn’t be easier. Second and more interestingly, Kik has chosen to interweave other apps into their messaging experience with cards!
Now I’m not saying the “card” experience is the same between both platforms but they both serve as self contained portals to the web. Twitter will spend less than $250 million for Kik at $5/user, and that’s an extremely inflated figure especially since they’ve only raised an $8 million Series A. That’s pennies compared to Twitter’s $10 billion valuation and increased user engagement (hint at possible Facebook Home type interface) will help them demand top dollar for advertising. A stretch? Sure, but an enticing one to imagine.
Oh and one more thing that makes sense, Twitter has a good track record with open source technologies like HTML5. Kik will love working at Twitter!