Twitter Economics

The Twitter flotation got a lot of press this week.

They floated at $26 a share, with 505 million shares in circulation leading to a market cap of $13.1 bn.

There was lots of interest in the shares and they rose above $50, and now stand at $41.  That's a market cap of around $20 bn.

It's a very popular service, I can't deny that - and it has tentacles into all media outlets - as they have been suckers for feeling the need for a presence on it.  Especially individuals of media who feel the need to self promote (despite the obvious danger of an ill judged tweet ending your career).

But this service has never made a profit, has yet to work out an advertising strategy - and could easily be replaced by a newer more trendy upstart.

I was dubious about Facebook - this is just crazy...

Facebook Economics IV

It has been a long time since I've looked at these shares, and the madness of the Twitter float has made me look back - I was pretty downbeat on them.  Give Facebook their due, it looks like they are working out how to advertise to mobile/small screen users.

So how about the shares?

There are 2.43 billion shared in circulation.

$47.53 dollars per share,  $115.50 bn market capitilsation

$38 dollars at floatation, indicating $92.34 bn value.

So an overall increase of $23.16 bn, a 25% rise in value.

Steady progress I say, and compared to Twitter this almost looks like a sensible business now...