When Twitter goes public, a few investors will do very well.
The New York Times sized up some financial documents and determined that Chris Sacca, Union Square Ventures and Spark Capital will all make more than $US1 billion on their early Twitter investments. Even those who didn’t contribute a ton of money, like Twitter’s current CEO Dick Costolo, will make multiple millions.
In 2007, when Twitter was getting off the ground, its co-founder Evan Williams helped round up investors. He emailed his friend Dick Costolo. Williams and Costolo both sold companies to Google, Blogger and FeedBurner respectively. Williams asked if Costolo would consider investing either $US25,000 or $US100,000 in the micro-blogging platform.
Three minutes later, Costolo wrote back: “I’m on the 25K bus.” That’s a lot of money, but to a successful entrepreneur like Costolo it’s pocket change.
That $US25,000 investment will be worth more than $US10 million when Twitter goes public, according to New York Times’ Nick Bilton and Vindu Goel. That’s a 400X return on investment. Costolo has likely received much more stock since becoming the company’s CEO too.
Just imagine if Costolo had been on the $US100K bus.