When This Company Finally Goes Public, It Will Blow the Facebook IPO Away

                                      

NEW YORK (TheStreet) -- I am on record as a Facebook(FB) bull. At this point, I still only own my token lot of three shares, but the time will come to buy more.

Even though I see FB becoming one of the market's next $100 stocks, I am more excited by the near certainty that Twitterwill go public at some point. Everything Mark Zuckerberg and Facebook have done well, Dick Costolo and Twitter have done better.

For most intents and purposes, Zuck and Costolo speak the same language. They're entrepreneurs who put the user experience first, everything else second. But, for one reason or another, Costolo appears to do a better job of walking the walk, at least with regard to timing the move to go public.

Few of us are inside baseball enough to know the reasons why, but Facebook probably IPO'd a shade or three too soon.

Cynics and haters will claim it had to pull the trigger because the business is about to implode. I doubt it.

Others will point to Zuck's relative inexperience. I can see this. Plus Zuckerberg founded Facebook, while Costolo did not pioneer Twitter. He's been there before (not at Twitter, but "there" as in being big time) in several previous lives; as such, he might feel less urgency to pop the cork and unleash the real wealth.

Regardless of the reasons, it appears Costolo will not take Twitter public until the business is not only ripe, but strong, sustainable and, at least relative to Facebook, saddled with fewer near- and long-term question marks.

While I expect Facebook to sort out its real issues -- as well as its media-generated and overhyped non-issues -- Twitter heads into that seminal moment in time much better positioned. Costolo deserves credit for this.

Consider the "issue" (I think it will quickly be viewed in retrospect as a non-issue) of mobile monetization. Costolo shocked the world the other day when he said Twitter generated more revenue via mobile than through the desktop on "many days" in the last quarter.

Costolo went on to explain that Twitter has "an ad platform that already is inherently suited to mobile." And it is. I am not sure what reasons Costolo would give for this, but, personally, it feels natural to see an ad come across my Twitter feed. It feels less so on my Facebook feed. I cannot necessarily put my finger on exactly why, but standard ads on Twitter do not look out of place.

It's somewhat similar to an advantage Pandora(P) has -- users expect and, as a result, tolerate a relatively small number of commercials while listening to radio, particularly if they're targeted and relevant.

That's another thing Costolo seems intent on perfecting: the relevance of the Twitter experience to each individual user. He's made leaps and bounds in the right direction, but Costolo has not brought Twitter "there" yet. Twitter will not go public until it brings its "A" game, all of the time, on mobile as well as the desktop.

If you've used the Facebook and Twitter mobile apps, you likely agree you cannot compare the two. Twitter blows Facebook away, not from an I like Twitter better than Facebook standpoint, but from design and functionality perspectives.

Twitter is also growing like a weed. Revenues could hit $1 billion in 2014. That would indicate a roughly sevenfold increase over last year's total of $139 million. When you go public, you want to be in the middle of that type of hyper growth.

If growth moderates at Facebook as many expect, Zuckerberg or Sheryl Sandberg (or whoever) will have to spend the company's entire first conference call as a public entity defending the business model and the future. That's just not a good spot to be in several months post-IPO, particularly in the aftermath of an offering that did not fire all that smoothly.

At Twitter, Costolo will boast about high double-digit (and maybe even triple-digit) revenue growth. He can comfortably set expectations well before the growth slows, stalls or merely takes a pause.

That's the position you want to be in during your first year as a public company. And Costolo knows this. You want to be not only growing at a rapid clip, but growing at a rapid clip while your business runs on all cylinders and the user experience is top-notch. Facebook is literally building its mobile app to what it hopes will be satisfaction on the fly. That's not good.

As a stock, Twitter might just perform like the "Teflon" stock, LinkedIn(LNKD). I just hope the company comes up with a better ticker symbol than the obvious "TWIT.

Rocco Pendola

06/08/12 - 07:34 AM EDT