Twitter makes IPO plans official: files confidential S-1, but expected value is about $14B

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Twitter has announced its long-awaited IPO in, what else, a tweet that came after market closed on Thursday:

Twitter’s note that this is a confidential filing means the company’s annual revenue is less than $1 billion. Usually when companies announce plans to go public, they have to file an S-1, the securities filing that companies use to provide details about their planned initial public offerings. Under the JOBS act of 2012, however, companies with less than $1 billion in revenue can file confidentially.

Sources familiar with Twitter’s thinking tell us the company has recently received bids from hedge funds offering to buy shares in the company from employees and investors for between $26 and $28 a share, which would value Twitter at $14 billion. The company has raised just under $1 billion in funding over the last several years as it has grown into one of the most ubiquitous fast-twitch communication networks of our time.

Until now, Twitter’s stock has been trading on the secondary market for between $18 to $22 a share, according to a source.

Twitter’s public offering, which is likely to take place in early 2014, will among the most high profile IPO’s since Facebook went public in May of 2012.

The company has evolved rapidly in the last two years, transforming itself from a “micro-blog” into a media behemoth whose partners include the likes of NBC, the NFL and major studios.

Twitter, which began in San Francisco in 2006, is also in a strong position in the advertising market since, from its inception, it has been built to serve two major trends: social networks and mobile communications. The company’s ad position grew even stronger this week on news that it acquired MoPub, which is the world’s biggest exchange for mobile advertising.

Twitter’s CEO is Dick Costolo, the company’s former Chief Operating Officer, but founder Jack Dorsey (who is speaking at our RoadMap conference in November) remains involved in the company; Dorsey rejoined Twitter as chairman in 2011 after a several year absence.

(More soon. This post has been updated multiple times as more information became available.)

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