Twitter IPO Just A Matter Of Time, Most Experts Agree

| About: Twitter, Inc. (TWTR)

If you ask Peter Thiel, tech guru and founder of PayPal (NASDAQ:EBAY), Twitter is going to be around for a long time. Thiel says that the company and its estimated one thousand employees can count on having jobs for decades to come. He's not without his critics, but Thiel says he not only believes in the business model for the company moving forward, but in its fundamentals as well.

Twitter in preparation for going public

Thiel got into a heated debate over Twitter at the Milken Institute Global Conference where he said that the business case for the company is solid. He contrasted it to The New York Times, which he believes has a tenuous future at best. The digital age is upon us, and only a select few from the days of print will survive the transition.

It's not just Thiel who sees good things for Twitter moving forward, but Netscape browser creator Marc Andreeseen as well. In anticipation of the inevitable Initial Public Offering for the company, Andreeseen's venture capital firm, Andreeseen Horowitz, has already taken an $80 million stake in Twitter.

Expected IPO date

Back in 2011 when Andreeseen sank $80 million into Twitter, the company's market valuation was estimated at just $4 billion. Two years later, most analysts agree that a $10 billion valuation sounds fair. So when will the company go public?

Most experts agree, Twitter will make its initial public offering in two years. It's expected to be the biggest social media offering since Facebook (NASDAQ:FB). Facebook went public back in May of 2012. It was the biggest internet public offering in history with a market capitalization peak of $104 billion. Even though shares in Facebook fell to as low as $15 per share in the aftermath of the offering, they have rebounded and are now trading near the $30 range. Facebook currently has a market valuation of $67.75 billion.

The facts about Twitter

Twitter just turned seven years old last March and already investors are clamoring for the company to go public. With 500 million registered users, still it trails Facebook and its 1.2 billion users by a wide margin. But it may be the very problems Facebook face last May in its IPO that are holding Twitter back.

Others believe Twitter is simply waiting until it can shore up its bottom line. Companies like Groupon (NASDAQ:GRPN), Pandora (NYSE:P), and Zynga (NASDAQ:ZNGA) have all seen share value plummet ever since their public offerings. There are those who believe they went public too early, before they had time to show real profitability.

CEO Costolo downplays IPO plans

If there is anyone who has his doubts about Twitter going public, it might be the CEO of the company himself, Dick Costolo. While others talk about the company's inevitable IPO, CEO Costolo says he's more focused on growing users and earnings for the company. Costolo knows as much as anyone what can happen when a company goes public too soon.

In fact, Costolo says he might be the only one who doesn't have IPO plans in his future. Costolo says he is not under any pressure either from investors or regulators to do so. "Nothing external to the company has had any bearing on how I think about when to take Twitter public or not to," says Costolo. So, for now at least, he says it is not.

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

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