When Twitter first started out, many people scoffed at their lack of revenue model. Twitter grew over the last 3 years without making any money, but the company raised about $155 million in total funding. Venture capitalists knew that Twitter’s strategy was to grow its user base first and then figure out a monetization plan later.
Now Twitter has a monetization plan. The company expects to make a profit of about $25 million this year. Of that $25 million, Twitter will make $15 million from Google and $10 million from Microsoft.
Google and Microsoft struck similar deals with Twitter in late October. Twitter would power real-time search for Microsoft’s Bing.com and Google.com. This means that Twitter was profitable in the year 2009, but the exact details of the deals are unknown. It is uncertain whether Microsoft and Google will be paying Twitter for multiple years. Twitter’s search engine was built through the acquisition of Summize in July 2008.