Twitter-y Startups Found Tiresome by Venture Capitalists

Here are the stats: In the June 2008-May 2009 time frame, venture capitalists and angel investors spent $21.6 million for Twitter-based startups. The figure fell to $10.4 million in the June 2009-May 2010 time span. What could have caused this dramatic decrease?

Research firm CB insights attributed this episode to a number of theories including “feeling of uncertainty by application developers and investors alike about the direction Twitter will go” and the analysis of the real role of startups in creating products for Twitter.

Twitter’s control left other platforms on an uncertain ground, as developers’s products could be packaged as part of the core offering. Not to say that Twitter wanted only the profit for themselves, but the startups should look further into their role in the ecosystem Twitter built, and do something more innovative to mitigate the risks.

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