Twitter lands major new funding round

@CNNMoneyTech August 2, 2011: 2:42 PM ET

NEW YORK (CNNMoney) -- Twitter has landed a major influx of cash to help it expand: The five-year-old social media company said Monday that it has just wrapped up a "significant" funding round led by venture firm DST Global.

Twitter didn't disclose how much it raised. However, Twitter amended its certificate of incorporation forms late last week to authorize the issuance of up to 25 million new shares, priced at just over $16 per share. That would let the company raise around $400 million in new funding, according to venture capital data provider VC Experts, which obtained a copy of the amended incorporation forms.

But the actual amount Twitter raised from investors could be higher, if it follows the latest tech trend of letting existing shareholders -- such as employees and early investors -- sell some of their shares to investors during a company financing round. Facebook, Groupon and Zynga -- which are also backed by DST Global -- all went that route in their later investment rounds.

"Twitter is one of the few companies that has truly changed the world," DST Global founder Yuri Milner told AllThingsD, which reported that the new round values Twitter at $8 billion. "Twitter's astonishing growth is a testament to how important it is becoming to more people every day, and why we couldn't pass up the chance to be a bigger part of its future."

Twitter, based in San Francisco, said it will use the additional funding to hire more employees, grow internationally and "aggressively innovate."

Founded in 2006, Twitter has expanded rapidly in the past year, increasing its staff from 250 to more than 500 employees. On Monday the company opened its second office, launching a New York City outpost.

Prior to its latest funding round, Twitter had already raised more than $350 million from investors -- but the company is widely believed to be unprofitable. Its most recent financing round was in December, when it raised an estimated $200 million from a group led by Kleiner Perkins.

Since then, the fast-growing company has made a number of management changes. Co-founders Ev Williams and Biz Stone stepped away from the daily operations of Twitter to focus on a new venture, while previously exiled co-founder Jack Dorsey returned to lead Twitter's product strategy. Twitter also acquired a string of companies developing around its platform as part of its expansion effort.  To top of page

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