Twitter valuation shoots to 8 billion dollars after $400M investment

It is a huge boost for micro blogging site. Twitter valuation has shot up to 8 billion dollars after $400 million investment

Though not going public immediately, microblogging giant Twitter has reportedly moved on to amass up $400 million in a deal, which will value the firm at $8 billion, reports said. Russian investment firm, DST Global, headed by a billionaire Yuri Milner and some other previous Twitter investors like Kleiner Perkins Caufield & Byers are to take part in the financing round.

When several peers of Twitter such as Facebook, Zynga and Groupon have announced plan to go public, Twitter is in efforts to raise funds accepting investments.

The company had previously collected $200 million from a number of investors such as Kleiner Perkins Caufield & Byers, Benchmark Capital, Spark Capital and Union Square Ventures.

Twitter that has over 200 million members is a San Francisco-based company. The microblogging site raises almost $200 million a year through its “promoted tweets” advertising program. $200 million a year means the company’s $8 billion stock value is 40 times better than its sales.

 “It’s a small business,” says Rory Maher, an analyst for Hudson Square Research. “The ad volume isn’t there. They’re going to have to come up with products that drive more volume for them, and they need to increase the number of users.”

Twitter started to monetize its service with the featured “promoted tweets” ad program in April 2010. It is meant to show ads of advertisers in users’ feeds and searches.