What Twitter learned from Facebook IPO flop

MarketWatchSeptember 14, 2013 

SAN FRANCISCO -- The day before Twitter Inc. disclosed that it has filed papers for an initial public offering, Facebook Inc. Chief Executive Mark Zuckerberg was asked what advice he would give to the microblogging site about going public.

Obviously referring to what's now remembered as a flop of a public trading debut, Zuckerberg quipped at the TechCrunch Disrupt

conference in San Francisco that he was "the last person you'd want to ask about how to make a smooth IPO."

In fact, Twitter appears to have learned key lessons from Facebook.

The biggest one is focused on a question that beset the Menlo Park, Calif. social media giant in the months leading up to its IPO: Can it make money from mobile?

That's not a concern today given Facebook's rapidly growing mobile business, which now makes up 41 percent of the company's total ad revenue, up from essentially zero a year ago.

But it was such a huge concern last year that Facebook disclosed in IPO filings that its ability to grow its mobile business was "unproven."

That's a hurdle Twitter has to show it can clear, said Howie Schwartz, CEO of mobile ad company Human Demand,.

"I think we're going to see a similar concern around Twitter," he told MarketWatch. "But I think Twitter has the opportunity to learn from those market reactions related to Facebook."

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