Twitter is in the process of completing an $800 million funding round that will value the company at approximately $8 billion, as well as cash out some of the company’s early employees and investors.According to All Things Digital, the funding will be a two-stage deal. The first $400 million will go toward the company itself, while the second $400 million will be set aside for cashing out employees and existing investors. This is similar to what Facebook did in 2009 with its $200 million in funding from Digital Sky Technologies.
In fact, DST, which also has stakes in Groupon and Zynga, is participating in the deal. J.P. Morgan is also reportedly participating in the round through its digital-growth fund. The company has raised more than $350 million in funding from Kleiner Perkins Caufield & Byers, Benchmark Capital, Union Square Ventures, Spark Capital and a host of angel investors, including Marc Andreessen, Ron Conway, Chris Sacca and Kevin Rose.
The deal, which is expected to close in the next two weeks, will value the company at $8 billion. This is the number The New York Times reported earlier this month. It also means that Twitter’s valuation will have doubled from its $200 million round in January 2011.
Unlike Zynga and Facebook, Twitter is still experimenting with business models and isn’t cash flow positive. It intends to place Promoted Tweets in user timelines sometime in the next month and a half.
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