Saudi Prince invests in 140 characters or less

Saudi News Corpinvestor billionaire Prince Alwaleed bin Talal has bought a $300 million stake in microblogging technology company Twitter.

Twitter is a mystery to some investors because, despite its impressive user-base, the commercial model still isn’t quite there. Regardless, the billionaire prince – himself worth approximately $19.6 billion – has plunged $300 million into the company.

Alwaleed made the investment through his Kingdom Holding Company, which is said to have been in long talks with Twitter. KHC has a seven percent share of News Corporation, the second-highest after Rupert Murdoch. 

KHC said in a statement that it had been talking to Twitter for months and  combing the books for due dilligence. It “reaffirms our ability in identifying suitable opportunities to invest in promising, high-growth businesses with a global impact,” Alwaleed said in a statement.

Although Twitter is still working on a way to truly monetise the influence it wields, KHC believes there is an opportunity there to leverage the nature of the media industry in general. 

Social media director at Essence, Hal Stokes, told TechEye that the move is an excellent pure business decision. “As the world progressively becomes tech driven, and media is progressively becoming social media, it’s simply a smart, progressive business move to diversify his investments,” Stokes said.

Stokes doesn’t believe that there will be any significant impact on Twitter’s day-to-day operations, because users will vote with their feet: “That’s the beauty of social media, users ultimately decide. If you offer a great service that suits their needs they’ll use you, stop doing that and they’ll move elsewhere. I can’t see that any significant impact will materialise.”

DST Global’s $400 million for a five percent stake of Twitter valued the company at roughly $8 billion in August this year. Looking at those figures, reports the FT, Alwaleed’s investment measures up to about 3.75 percent.

Alwaleed is the nephew of King Abdullah of Saudi Arabia.