Advertisers go where the users are, and right now within social networks that's Facebook (META -10.96%). With Twitter preparing to go public, investors should remember that Twitter is significantly smaller than Facebook, which could present some challenges for the company to grab ad dollars from Facebook. Twitter's user base is about a fifth of Facebook's, and it generates less than a tenth of the revenue.
LinkedIn's (LNKD.DL) registered user base is slightly larger than Twitter's, but the professional networking site has a different monetization strategy and so competes less directly. LinkedIn is growing its marketing segment, but its bread and butter continues to be recruiting. Twitter, Facebook, and LinkedIn all rely on network effects to drive their businesses, and Facebook is the clear leader within the bunch.
In this segment of Tech Teardown, Erin Kennedy discusses Twitter's size with Jamal Carnette and Evan Niu, CFA.
