In Twitter’s IPO filing, one of the interesting nuggets has to do with the acquisition prices of Boston-area startups Bluefin Labs and Crashlytics. Or rather, what Twitter is saying about those prices (and what it’s not saying).
I have confirmed with two sources who have knowledge of the deals that the values I originally reported in February are correct—in the neighborhood of $100 million for Bluefin Labs, and more than $100 million for Crashlytics.
Those numbers represent the total value of each deal, including stock options and payouts that could extend over the next 48 months. To my knowledge, these companies are Twitter’s biggest acquisitions to date.
Twitter’s S-1 filing with the Securities and Exchange Commission says it paid $38.2 million for Crashlytics and $67.3 million for Bluefin Labs, both in common stock. These represent up-front payments only and don’t count the tens of millions of dollars in “equity consideration which was to be paid to certain employees of the acquired entities contingent upon their continued employment with the company.”
Counting all of Twitter’s 2013 acquisitions—there were also three other small ones—that “equity consideration” amounts to $54.9 million, according to the document. The up-front payment figures also don’t count future payouts to the startups’ investors; the size of those is not disclosed in the S-1.
Of course, none of the companies or their investors are talking on the record. But it just goes to show that reading SEC forms—and descriptions of acquisition prices in particular—is an exercise in decoding accounting-speak. Always better to have sources who know what they’re talking about.
