These Acquisitions Could Save Twitter, Inc.
Microblogging social media web site Twitter, Inc. (NYSE:TWTR) seems to have hit a rough patch this year. Having already cratered more than 31% this year, it looks like TWTR stock has landed on a perpetual downward spiral.
Hedge fund holdings in Twitter stock are starting to decline, while investor woes are on the hike. To make things worse, CEO Jack Dorsey is seemingly busy with Square, Inc., the other company he heads that went public last week. Amid these circumstances, one plausible way Twitter could find its way back up the industry ladder is through viable acquisitions.
It wouldn’t be too out of the ordinary for Twitter to consider an M&A scenario in order to strengthen its position in the industry against its biggest and fast-growing rival, Facebook, Inc. I suggest the following seven options that the company can consider to invest in.
1. Sulon Technologies Inc.
Internet companies are starting to invest big in technology gadgets to become a part of the growing ecosystem of the “Internet of Things.” Companies like Alphabet Inc (formerly Google) and Amazon.com, Inc., which were once only focused on the Internet world, have fast transitioned into the technology world. To keep pace with the changing industry dynamics, it’s only reasonable that Twitter makes an early move to grapple on to some of the remaining market share in the tech industry and what better way to speed up things than by acquiring a promising company like Sulon Technologies Inc.?
Rival Facebook has been betting big on the future of virtual reality (VR). Facebook’s VR and immersive gaming headgear, “Oculus Rift,” is touted as one of the biggest releases of next year. To counter it, Twitter may consider acquiring Sulon Technologies, a direct competitor to Oculus Rift.
Sulon Technologies is a Canada-based company that’s trying to find a place in the virtual reality (VR) and augmented reality (AR) markets with its own headgear device, dubbed “The Cortex.” The company is still in its nascent phase of development and might be a good investment to look at. With the right kind of push from a bigger, publicly traded company like Twitter that has better access to external financing, this acquisition could turn out to be a very fruitful investment.
One feature that Twitter’s platform direly lacks is a messenger. Unlike Facebook, which not only has a built-in messenger for its namesake social media platform, but also acquired the top messaging app, WhatsApp, last year, Twitter has been particularly missing out on this service.
Should Twitter consider to make a move in this segment, one messaging app it can acquire or merge with its core business is Kik. As opposed to WhatsApp’s relatively serious platform for the young and old alike, Kik is more of a fun chat app for youth and young adults and offers wider features, including web browsing and sticker sharing within the app. Kik offers a degree of anonymity, unlike WhatsApp, where you must share your phone number with your contact.
Valued at over $1.0 billion now, this company has, so far, been turning down acquisition offers. But a lucrative “mutualistic” offer might help change Kik management’s mind. Kik’s fun aspect and popularity amongst the youth could give Twitter a chance to target the younger market, where its namesake platform has been fairly absent.