We don't know many of the specifics of Saudi Prince Alwaleed bin Talal's recent $300 million investment in Twitter but we do know one thing about bin Talal, the richest businessman in the Middle East: he's savvy. With an estimated $19.6 billion net worth, the 56-year-old, American-educated investor and nephew of the Saudi king is forward-thinking, not only in the companies he's interested in giving money to but also the causes that he's willing to champion. Forbes describes bin Talal as an Arab billionaire whom, unlike many of his peers, actively promotes "broader political participation, fair elections and effective job creation across the Arab world" and "has been pushing women's advancement." After news of bin Talal's mammoth investment in the microblogging, democracy-enabling service, tech blogger Mathew Ingram wondered (on Twitter), "What happens if there's an Egypt-style 'Arab Spring' movement in Saudi Arabia?" In a fascinating matter of speaking, the Saudi revolution could be sponsored in part by the Saudi royal family.
First things first: this latest and perhaps biggest round of investment is a huge deal. As Facebook prepares for a $10 billion initial public offering as soon as spring of next year, analysts estimate that bin Talal's $300 million investment values the company at $10 billion. Reports estimate that chunk of change bought bin Talal's stake -- or rather that of his company, Prince Alwaleed and Kingdom Holding (KHC) -- in Twitter at 3 to 3.75 percent. The massive influ of capital could mean a lot for Twitter's ability to support further explosive growth including but not limited to a doubling down on the development of its advertising platform and revenue model. Bloomberg broke the story of the latest round of investment and reports on the company's plans:
Twitter is seeking to speed up its ad rollout program, its main source of revenue. The microblogging service’s revamp will feature tabs at the top of the screen that let users more easily access their home pages, connect with others and discover new content. EMarketer cut its estimate for 2011 ad revenue to $139.5 million from $150 million in September because Twitter has been slow to roll out some services.
So far, Twitter has stayed silent, but we've reached out for comment and will update you when we hear back.
Bin Talal's reputation is strong and his stated interest in joining the Twitter family sounds fair. "Our investment in Twitter reaffirms our ability in identifying suitable opportunities to invest in promising, high-growth businesses with a global impact," the Saudi prince said in a statement, adding that the deal came after "several months of negotiations and comprehensive due diligence."
Then again, since bin Talal's also bankrolled some suspicious companies, too, we expect some skepticism in the not too distant future. Bin Talal is the same Saudi Prince who made headlines over the summer for supporting the Murdoch family in the face of the News Corp. phone hacking scandal. As the corporations number two investor, second only to the Murdochs themselves, bin Talal took a controversial position in defending the status quo at News Corp., though its unclear if it was a business decision or a moral one. "At the end of the day News Corp is going to get out of it," said bin Talal in July. "I think Rupert and James Murdoch came very forcefully and strongly and will resolve and clear this mess very quickly and I respect that." Bin Talal so far appears to have spoken too soon, at least about the younger Murdoch.
But News Corp. is just one of bin Talal's many, diverse investments. Nicknamed the "Arabhttp://www.adweek.com/news/press/arab-warren-buffett-talk-murdoch-piers-133586 Warren Buffett," bin Talal he Prince also owns an estimated $1 billion stake in Citigroup and has also invested large amounts of money in companies like Apple, AOL, Motorola and even Euro Disney. Earlier this year, he also contracted the Saudi Binladen Group (yes, those bin Ladens) to build the Kingdom Tower in Jeddah which, when finished, will be the world's tallest building.
Without casting any judgement or grasping for meaning, we'll revert to what we said at the beginning of this post. Bin Talal is a big deal in the global investment community and his vote of confidence in Twitter as a business is a big deal as a result. Judging by what we know about the Prince's personal taste in yachts, thrones and fashion, he'll also be a fun addition to Twitter's already eccentric family of supporters.
Update (1:37 p.m.): Fortune's Dan Primack reports some new details on BinTalal's investment:
Fortune has learned that the deal is structured as a secondary, which means that Alwaleed purchased shares from existing Twitter insiders. The company would have been required to approve of the transaction, but will not actually receive any of the $300 million, as it would in a more traditional investment.