Twitter IPO sparks speculation on who could follow

Sat Nov 9, 2013 7:06am EST
 
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By Sarah McBride, Alexei Oreskovic and Gerry Shih

SAN FRANCISCO (Reuters) - For technology executives weighing market flotations for Silicon Valley startups, this week's gangbusters Twitter Inc initial public offering sent a powerful signal: full speed ahead.

About a dozen private companies are valued at more than $1 billion, and many of them have already been holding informal talks with bankers. Now, many - including Box, Square and Airbnb - are likely to accelerate their IPO plans, according to venture capitalists.

File-sharing company Box picked Morgan Stanley, Credit Suisse and JP Morgan to lead its IPO, Reuters reported Friday. The company has been valued at more than $1.2 billion by private venture capital investors, but it remains unclear whether it is profitable.

Twitter's lack of profits proved to be no obstacle to the micro-blogging site raising as much as $2.1 billion in its IPO. Its current share price of around $41 gives it a market value north of $22 billion.

That opens the door for other big-name private companies including Square, the payments company founded by Twitter co-founder Jack Dorsey, which has begun exploring the possibility of an IPO next year, according to the Wall Street Journal. Profits are not expected until 2015. Square declined to comment.

Airbnb, an accommodation service, is also often cited as a potential IPO candidate. "They don't have inventory and have pretty low overhead," said analyst Michael Pachter, who believes the company is profitable. The company declined to comment.

'SOME GUY ON MADISON AVENUE'

At Dropbox, a file-sharing service, Chief Executive Drew Houston said in September that his company, valued at $4 billion, has cash left from a recent fundraising round and is in no hurry to hold an IPO.   Continued...

 
Twitter CEO Dick Costolo is interviewed after the Twitter Inc. IPO on the floor of the New York Stock Exchange in New York, November 7, 2013. REUTERS/Lucas Jackson