Twitter’s Costolo in China fact-finding visit; Mr Costolo will meet Shanghai government officials on his first trip to China, where the San Francisco-based messaging site has been banned since 2009

March 17, 2014 5:35 am

Twitter’s Costolo in China fact-finding visit

By Hannah Kuchler in San Francisco

One of Silicon Valley’s most prominent chief executives embarked on a pilgrimage to China on Monday, highlighting the increasing importance of the country’s large and vibrant internet sector.

While executives from across the business world flock to Silicon Valley to try to glean clues about their future, US technology leaders are looking to China for new ways of turning users into profits.

Wall Street is also getting excited about Chinese internet companies as Alibaba, the Chinese ecommerce group, and Weibo, a Twitter-like service, look set to be among the largest initial public offerings of the year.

Twitter’s chief executive Dick Costolo is making the trip to Shanghai after the group’s head of revenue told the Financial Times last week that it should learn from the business models of Asian internet companies such as chat apps WeChat and Line.

The companies charge users for products such as stickers and games rather than relying almost exclusively on advertising revenue like Twitter and Facebook. Mark Zuckerberg, Facebook chief executive, has visited the headquarters of Chinese internet companies.

“Dick is visiting China because he wants to learn more about the Chinese culture and the country’s thriving technology sector,” Twitter said. “We have no plans to change anything about our service in order to enter the market.”

Mr Costolo will meet Shanghai government officials on his first trip to China, where the San Francisco-based messaging site has been banned since 2009. Other major US internet companies Google and Facebook are also prohibited in China.

However, Twitter said it had no plans to enter the large and fast-growing Chinese internet market. Twitter prides itself on its commitment to free speech and has occasionally fought court battles on behalf of its users.

Mr Costolo will spend a few days in Shanghai, where he will also meet academics and students at Shanghai’s Fudan University, but will not visit Beijing.

Investors are also increasingly interested in Chinese internet companies that have often developed different business models from those in the west behind the shield of the so-called Great Firewall of China.

The visit comes as Alibaba, the Chinese ecommerce group, prepares to raise up to $15bn, while Sina is spinning off its Twitter-like service, Weibo, in a $500m to $700m IPO.

Alibaba, which announced its much-anticipated plans to list on Sunday, could be among the companies with the highest valuation ever at IPO and could earn bankers, lawyers and accountants in New York up to $1.1bn, according to estimates from research firm PrivCo.

Twitter, which has roughly three-quarters of its users outside the US, is used by some Chinese people over virtual private networks – among the most prominent is Ai Weiwei, the dissident Chinese artist.

The company hired its first full-time employee dedicated to managing its business in greater China, which includes Hong Kong and Taiwan, in the run-up to its IPO last autumn.

A job advert asked for a candidate who would work with celebrities and television networks to boost Twitter’s presence across greater China.


About bambooinnovator
Kee Koon Boon (“KB”) is the co-founder and director of HERO Investment Management which provides specialized fund management and investment advisory services to the ARCHEA Asia HERO Innovators Fund (, the only Asian SMID-cap tech-focused fund in the industry. KB is an internationally featured investor rooted in the principles of value investing for over a decade as a fund manager and analyst in the Asian capital markets who started his career at a boutique hedge fund in Singapore where he was with the firm since 2002 and was also part of the core investment committee in significantly outperforming the index in the 10-year-plus-old flagship Asian fund. He was also the portfolio manager for Asia-Pacific equities at Korea’s largest mutual fund company. Prior to setting up the H.E.R.O. Innovators Fund, KB was the Chief Investment Officer & CEO of a Singapore Registered Fund Management Company (RFMC) where he is responsible for listed Asian equity investments. KB had taught accounting at the Singapore Management University (SMU) as a faculty member and also pioneered the 15-week course on Accounting Fraud in Asia as an official module at SMU. KB remains grateful and honored to be invited by Singapore’s financial regulator Monetary Authority of Singapore (MAS) to present to their top management team about implementing a world’s first fact-based forward-looking fraud detection framework to bring about benefits for the capital markets in Singapore and for the public and investment community. KB also served the community in sharing his insights in writing articles about value investing and corporate governance in the media that include Business Times, Straits Times, Jakarta Post, Manual of Ideas, Investopedia, TedXWallStreet. He had also presented in top investment, banking and finance conferences in America, Italy, Sydney, Cape Town, HK, China. He has trained CEOs, entrepreneurs, CFOs, management executives in business strategy & business model innovation in Singapore, HK and China.

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