Twitter’s Rational Irrationality

by Bradley Miller on March 13, 2009

I think the Twitter storm over the past several weeks has subsided.  Talk was all about Twitter – everything from twitterifying SF to the White House to Charlie Rose.  And while some were even questioning the true value of Twitter or even its actual valuation, I tend to think there’s still reason for the company to have a high value, if it can get its act together.

At the surface, the lack of a revenue stream for Twitter would be a non-starter for most people.  They don’t do ads, and if they did, it might actually drive traffic away.  The meritocracy that is Twitter is what enables its success. And there is value in that somewhere, and it takes some crazy-like-a-fox investors to actually know what they’re looking at.

As Michael Arrington writes (someone else please write about this – I don’t like quoting this guy) there is an intrinsic value in Twitter – it raises public profiles for the likes of Ashton Kutcher, John McCain and even drives traffic to Tech Crunch and Facebook.  But it took time for Twitter to build up and begin to show this real value – over 2 years.  That’s patience in this economic climate.  And it’s also why I hope investors and entrepreneurs don’t slow down or solely go for cash flow positive companies from day 1.  While those companies might be sustainable, it often seems harder for those companies to make a huge and lasting impact.  Businesses like Google and Twitter took time to develop, but they did and we’re the better for it. What can other sectors/industries take from this model?  I’d like to hear from you.

I think this lesson is directly translatable in to the life science and healthcare industries as well.  All too often for new initiatives they look to the direct and immediate impact of new ventures.  While life science does go on some of this faith, all too often they run in to the constraints of regulation and huge financial limitations, and that’s a major problem.  We need to figure out how to speed innovation and create an environment that allows for quicker development and marketing of life science technologies, particularly as they become more data driven companies, rather than direct therapeutics.  I mean this more at a high level concept, rather than a hard idea – something I’ll continue to noodle on.

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