Twitter Business Model Found

Jason Calacanis just put Twitter in business. How? He offered $250,000 to be one of 20 users in Twitter’s “Suggested Follows” for two years.

Twitter is growing so fast that being on the “suggested” list for new users can generate more than 10,000 followers a day. Jason thinks the slots will soon be worth a Super-Bowl-like $1 million a year, as companies compete to be able to send real-time messages directly to millions of followers.

Or not.

Dave Winer complains that the Suggested Follows list is unfair. Twitter investor Fred Wilson seems to agree:

Bijan [Sabet at Spark Capital, a Twitter investor] got it right when he said that the current suggested follows is a short term fix to address the “out of the box experience” problem for many of the newcomers who have no idea what twitter is and who they should follow. the third party recommendation services aren’t a great help to them because they don’t even know what a third party twitter app is.

…but you are right to point out that the current model isn’t ideal and nobody knows that better than Ev. it’s going to change and hopefully sooner rather than later.

TechCrunch has more on Jason’s offer here. Even if Twitter kills the “Suggested” page, this exchange provides a hint of how powerful (and profitable) this company can eventually become. We continue to think it will eventually be worth more than $1 billion.

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