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The Twitter IPO - Essay Example

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The Twitter IPO

One of the social media giants Facebook is also listed on Nasdaq but there are several reasons being put forward by Twitter for such a stance. One of the most prominent reasons for Twitter to avoid Nasdaq is the not so successful IPO of the Facebook. As many witnessed the glitches which made the Facebook suffer. There were many delays and technical problems. The systems of the Nasdaq did not go through well and it was a mess on the first day of the opening. The IPO is likely to take place late in 2013 or early 2014. The pundits are predicting figures above a billion dollars that is expected to bring in about for the social network website. There are several other factors for such decision. The trend of tech companies is quite high and many are thinking of a potential listing. Twitter also considers this a great time when the trends are hot and looking to avail such opportunity. A return of 28% has been recorded for tech IPOs this year and is the second best after the 51% of the health sector as being reported by morning star. As Paul Brad, an analyst with Renaissance Capital states tech companies are one of the strongest areas of the IPO market to date.2 Such decision is also likely to have impact on the wide range of stakeholders of the Twitter. This could well be related to the Legitimacy Theory which states that organizations take influence of their social and external environment (Tilling). This could well be seen here as Twitter also follows the social norms, beliefs and values that are currently prevailing in the industry. Many tech companies are trying to obtain listing. So does Twitter follow the footsteps of them and one of the influence or inspiration could be the IPO of the Facebook. The writer suggests that there are basically two levels of the theory; one is institutional level which involves government and other bodies in a wider context and the other one is organizational level in which the companies such as Twitter falls (Tilling). At this level organizations try to seek approval from the society in pursuit of their own goals. However, if they succeed they remain in existence otherwise they face dire consequences and fight for their survival. Once organizations expand and their operations become widely spread and they get acceptance from the society, there comes another responsibility on them. This can be of relevance with the Stakeholder Theory. The theory suggests that the vary existence of organizations is to create value for their shareholders over time.3 If setting aside the other ethical obligations of an organization; the core objectives of the organizations are to maximize the shareholders’ wealth. But then comes a range of stakeholders with different set of goals and expectations. It is the duty of the organizations to keep a balance between such stakeholders (Reynolds, Frank and David, 2006). Twitter here is also expanding its stakeholder on a large scale now. From previously, their main stakeholders were only the users of their website but now upon obtaining listing they will have the responsibility to serve a wide range of stakeholders. From shareholders to users to wider society at large. They will also be liable to some ethical practices and transparent disclosures. Latest acquisition of Staples In the latest news, it has been reported that the Staples has acquired Runa, a San Mateo, California based Start-up Company whose business is specialization and personalization in e-commerce technology.4 The biggest factor of such a decision was that Staples wanted to boost up its on-line sales in order to compete with Amazon and other tech advanced companies in the e-commerce space. The chairman and CEO of Staples, an office supplies ...Show more

Summary

s the news of Twitter (a social media website) being going public is revolving for some time, recently they announced that the twitter will obtain listing on New York Stock Exchange (NYSE) rather than Nasdaq…
Author : selena25
The Twitter IPO essay example
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