Twitter has acquired several start-ups over the years, including newsletter platform Revue, storage technology start-up DriveScale, and creative agency Ueno this year. And while debates on ‘large social media companies becoming larger through acquisitions’ continue, these clearly aren’t deterring such acquisitions.
One such acquisition, which perhaps never materialised, is Twitter’s attempt to gobble up latest media sensation ‘Clubhouse’, for a reported $4Bn. According to a Bloomberg report, Jack Dorsey-led Twitter had negotiated with Clubhouse for a possible acquisition of the live drop-in audio networking platform with a deal worth around $ 4 billion. However, there was no clear conclusion to the matter as the discussions that have been going for the past several months are no longer ongoing, and it is unclear why they have stalled.
It is worth noting that Bloomberg had reported recently that Clubhouse was planning to raise funds at a valuation of $4 billion. Now that the talks with Twitter have fallen through, Clubhouse may be changing its strategy to pursue securing additional capital in exchange for equity investment.
It was the invite-only platform Clubhouse that popularized the idea of hosting live audio conversations last year, expanding its user base to over 10 million people. Its rapid rise has not gone unnoticed by some of the biggest players in the field, and it has faced stiff competition from Facebook, Twitter, Discord, LinkedIn, Slack, and others, which already have a large user base, as well as fully built web, iOS, and Android apps.
Clubhouse recently launched the first of its monetization efforts, Clubhouse Payments, which allows its users to send direct payments to other creators on the platform, provided that person has enabled receipt of said payments. What makes Clubhouse Payments unique is that it does not add to Clubhouse’s finances, but instead is monetization for recipient users who receive 100% of the funds, and only a small amount is deducted for processing that goes directly to Stripe, the payment provider Clubhouse is using to enable the virtual tips.
Twitter had earlier launched Spaces as a rival to Clubhouse on both iOS and Android last year, although it is still a beta version. Twitter plans to launch a web version as well as open hosting abilities to all users this month.
The details of the negotiations between Twitter and Clubhouse have not been revealed, meaning that Clubhouse and Twitter continue to be rivals in the arena. While Clubhouse’s rise to fame has been nothing short of scintillating, questions still remain about its longevity.