SAN FRANCISCO (Reuters) - Celebrity chef Mario Batali landed on a new promotional platform this week, one that was regulatory rather than razzle-dazzle: the opening pages of Twitter’s 234-page document on its initial public offering.
In a prominently featured screen shot of tweets where the American chef offered cooking tips alongside British rock musician Gavin Rossdale, the company showcased the way people express themselves on the online messaging service.
“Use San Marzano tomatoes, cook garlic less?” the American chef proposed in response to Twitter user Susan Mitchell’s difficulties with her red sauce. “Could be the basil—too much too long,” suggested Rossdale.
Thursday’s filing, also displaying tweets from President Barack Obama, the House of Windsor and the National Basketball Association star Kevin Durant, underscores a unique risk factor associated with Twitter Inc’s IPO. Specifically, its business model depends on a rarefied cohort of high-profile movers and shakers to contribute, including “world leaders, government officials, celebrities, athletes,” Twitter explained in its prospectus.
“If users, including influential users, do not continue to contribute content to Twitter, and we are unable to provide users with valuable and timely content, our user base and user engagement may decline,” the filing said, warning potential investors that advertisers may move away.
Some of the people mentioned in the regulatory filing were flattered.
“I‘m quite thrilled to see they still consider it an important moment in Twitter history,” Veronica McGregor, a spokeswoman for NASA’s Jet Propulsion Labs, said in an email.
McGregor tweeted the discovery of ice on Mars by the Mars Phoenix Lander in 2008, back before Twitter, now eight years old, had broken through to most of the general public.
“I never expected it to be picked up like this, in such an important document,” said Rossdale, the lead singer of Bush, in an email to Reuters, about his cameo in Twitter’s filing, known as an S-1.
Largely absent from the curated celebrity list in the filing were tweeters who mostly appeal to younger audiences — no Kim Kardashian, the reality star, or singers Justin Bieber or Lady Gaga, for example, even though they are all prolific tweeters with millions of followers.
Those omissions are likely very deliberate, in order to avoid giving any type of fly-by-night feeling to the filing, says Joe Fernandez, the chief executive of Klout, a company that measures social-media influence.
Twitter did not immediately respond to a request for comment.
In addition to the generic, boilerplate warnings about currency fluctuations and litigation, every company has its own unique risk factors that reveal something special about the organization. Facebook Inc alerted investors that founder Mark Zuckerberg controlled the majority of the company’s voting shares and that negative publicity about its privacy practices could harm its business.
Google Inc warned that some people were displeased by the fact that its search technology could be used to help people find hateful or derogatory information on the Web.
A windfall of riches is another common risk factor for Silicon Valley Internet companies.
Twitter, like Google and others before it, warns that the early employees with low priced stock options which have surged in value after the IPO may lose focus and that sudden disparities of wealth within the rank and file could cause inter-company tension.
And while Twitter is counting on celebrities and regular Joes to broadcast their latest musings to the world, the company admits that its 140-character messages, often larded with symbols such as # and $, can leave some potential users scratching their heads.
“New users may initially find our product confusing,” Twitter said in its prospectus.
Klout’s Fernandez said Twitter’s fears about falling out of fashion are not unfounded, pointing out that MySpace was once the social-media site of choice for musicians and is now all but abandoned by them.
“You could imagine where Snapchat or Instagram, for example, might come ahead,” he said, referring to popular photo-messaging applications which compete with Twitter.
Twitter has taken various steps to simplify its service over the years, adding a “discover” section that highlights tweets from celebrities that the service thinks a new user might find interesting, and adding shortcut buttons to accomplish common tasks like “re-tweeting” someone else’s message.
The company, which is seeking to raise $1 billion in the IPO, said it now counts 218.3 million monthly users. Among Twitter’s other trophy users are the Pope, Oprah Winfrey and Iran’s president.
Twitter’s prospectus also featured some ordinary users who attained their 15 minutes of fame by witnessing an important event and quickly tweeting it.
“Check out page 97,” tweeted Janis Krums, a New York entrepreneur, on Thursday night after seeing the filing. His 2009 tweet of his photo of a United Airlines plane floating in the Hudson River after a crash-landing was cited by the company as an example of real-time news breaking on Twitter.
Twitter’s generous mentions of various users won’t necessarily translate into share purchases, particularly for some who believe their early contributions were among those that helped Twitter become popular. Ask NASA’s McGregor.
“Ha!” she joked. “They owe me shares!”
(This story was corrected to make it “reflects” instead of “reflect” in headline)
Additional reporting by Roberta Rampton in Washington; Editing by Jonathan Weber and Grant McCool