Twitter: back to the VC well

Twitter is seeking new venture capital. According to TechCrunch:

It's likely they'll raise more than the $20 million in capital they've taken in over two previous rounds. Their last round, raised in June 2008, was a $15 million raise from new investors Spark Capital and Bezos Expeditions. Union Square Ventures and Digital Garage increased their previous investment.

Rumor is Twitter hit up more than a few venture firms to pitch the $250 million valuation, and got more than one "no." But someone's bit, perhaps encouraged by Twitter's breakneck growth and the interest from Facebook. That means Twitter gets a new cash injection and time to figure out its business model at an even more leisurely pace.

TechCrunch thinks this is good news (it gives Twitter that "even more leisurely pace"), but I'm not so sure. Here's what the NYT reported last month:

Twitter has raised $20 million from venture capitalists, but has brought in virtually no revenue, choosing growth over everything else. Indeed, [CEO Evan] Williams said he had planned to raise more capital in mid-2009 and wait to worry about revenue until 2010.

The recession changed that strategy, Mr. Williams said. "I don't want to have to raise money in 2009." Revenue is now a priority for the first quarter of next year.

Here's the rest. It might be good that Twitter is raising money, but a little over a month ago the CEO was hoping they wouldn't have to. What changed?

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Conor Clarke is the editor, with Michael Kinsley, of Creative Capitalism. He was previously a fellow at The Atlantic and an editor at The Guardian. More

Conor Clarke is the editor, with Michael Kinsley, of Creative Capitalism, an economics blog that was recently published in book form by Simon and Schuster. He was previously a fellow at The Atlantic and an editor at The Guardian. He is also on Twitter.

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