UPDATE: Twitter Closes 'Significant Round Of Funding'

Micro-blogging service Twitter Inc. said Friday it had closed a "significant round of funding," a deal that will give the wildly-popular startup more time to develop a business model.

San Fancisco-based Twitter did not disclose financial details in the release. People familiar with the matter said Friday the company raised around $100 million at a valuation of $1 billion. The Wall Street Journal previously reported the terms of the funding Thursday.

Twtter said investors included Insight Venture Partners, T. Rowe Price (TROW), Institutional Venture Partners, Spark Capital and Benchmark Capital.

The micro-blogging service, which lets people broadcast short text messages to anyone who wants to read them, has grown from about 4 million unique visitors in August 2008 to almost 55 million unique visitors worldwide one year later, according to comScore Inc.

But Twitter, which has attracted interest from Internet titans like Google Inc. (GOOG) and Microsoft Corp. (MSFT), and faces competition from social networks like Facebook, has thus far failed to explain how it might make money.

Twitter has said it might develop premium services for business, but the company hasn't yet unveiled those products. Co-founder Biz Stone said in a company blog post earlier this year that Twitter is leaving "the door open for exploration" around advertising.

Word of the funding coincided with the release of a report by Los Angeles-based research group Interpret LLC saying that people who use Twitter appear to be much more open to advertising than those who use other social media.

-By Scott Morrison, Dow Jones Newswires; 415-765-6118; [e-mail]

(Jessica Vascellaro contributed to this report)