Now it’s a done deal. Twitter has purchased search engine Summize, a deal that leaked out last week but didn’t wrap up until the last few days. Twitter’s Biz Stone has the official announcement here, but of course don’t offer up the most pertinent information, like price.
Our best effort: We hear the 5-man, Virginia-based company sold for something in the $15 million range, paid out in a mix of cash and Twitter stock. Yes, Twitter stock: A company that has no obvious business model but does have plenty of technology problems is now in the position to fund M&A with equity, thanks to a funding round that values the company at about $100 million.
Think of that development as a Rorschach test for your take on Web 2.0 in general: Either this thing is going to implode very soon, or people who get hung up on startup valuations are short-sighted bores who don’t get the possiblities of technology.
And, if you’re feeling generous, Summize might well help Twitter solve its business model problem, too. Twitter users wouldn’t stand for ads sold into their tweets, or on their Twitter pages themselves. But there are a couple of companies we can think of that have done well by selling ads on search pages.
Suddenly, Twitter has become a more interesting business. Or potential business, at least. And as a hedge, there’s also no reason why Summize has to work with Twitter exclusively — it could just as easily search other social networks/applications.
In any case, at a minimum, Summize is growing very, very fast, which in Web 2.0 terms means it has to be worth something, right? In March, the search engine was processing 71,203 queries per week; last week it handled more than 14 million. Chart via John Borthwick, whose Betaworks holding company invested in Summize last year:
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