Twitter may be going public, but can it make money? 

epa03924586 A view of a banner for the social networking and micro-blogging site company Twitter at the offices of JP Morgan Chase in New York City, N...
A banner for the social networking site Twitter at the offices of JP Morgan Chase in New York City, 25 Oct. 2013. Twitter executives were visiting potential investors before the company's initial public offering expected on Wednesday. JUSTIN LANE

Facebook did it, now it's Twitter's turn.

But on the eve of its initial public offering, which could raise billions and mint new millionaires, some on Wall Street are asking if Twitter's business model of messaging can morph into a serious, profitable venture.

Nearly half of active investors say Twitter would not be a good investment, according to a new poll. But revenue from advertising -- a key to business success for social media, is rising and entrepreneurs are embracing Twitter as a platform to launch new businesses and products. Also, it appeals to younger people -- a key ad demographic

Twitter raised its IPO price range to $23 to $25 per share on Monday, but kept the offering size at 70 million shares. That means it will raise up to $2 billion if an overallotment option of 10.5 million shares is exercised.

When eBay went public 15 years ago, the virtual marketplace was a concept merchants and shoppers could easily grasp. The Twitter community, though, takes more effort to envision.

The global mashup of 140 character tweets, or text messages, has serious business gumption. Only 7 years old, Twitter is earning revenue on an advertising foundation, albeit a nascent one. Its active users are growing in ranks, especially internationally. And then there's Hollywood. Twitter is building partnerships with content creators in media and entertainment.

"What Twitter is selling essentially is a new type of advertising platform, scalable across desktop and mobile," said Brian Solis, principal analyst at Altimeter Group, a San Mateo, Calif.-research group.

If eBay is a vast bazaar and Facebook is a utilitarian planner to track friends, Twitter can be an infuriating rant about everything and nothing to silly.

"I hated Twitter at first. I thought it was the stupidest thing I'd ever seen," said Mark Schaefer, a social media consultant. "Then I realized it's a real-time, global brainstorming session."

Navigating Twitter also isn't easy. "It's not intuitive like Facebook or YouTube," owned by Google, said Schaefer, author of "The Tao of Twitter." YouTube is about videos. Facebook is about preening in front of a digital mirror: "I'm being fabulous. Look at meee!"

But Twitter requires more effort. You have to say something. Witty. Terse and poetic even. And just showing up and being boring can actually cost you in followers dumping you. And there's a distinct whiff of preciousness about Twitter -- that the insidery platform is the domain of tech-savvy hipsters and millennials.

"Twitter is beloved by a much more connected person, who understands the pace of a real-time world," said Solis. "The experience you have on Twitter is what you make it. I don't follow people who tweet pictures of their food."

"Twitter is kind of the opposite of Facebook. It dominates among younger people, and it's hardly used at all among older people. Facebook is the other way around," Wedbush Securities analyst Michael Pachter told CNBC. "I actually use the social media site to promote me as a brand," said Pachter, who has more than 36,000 Twitter followers. 

And it's precisely Twitter's ability to explain its brand-building potential—and construct a narrative around such marketing opportunities—which will shape the company's profitability. The social messaging platform at its core is about connecting people with similar interests in real time—advertising's holy grail.

"People connected based on interest is incredibly valuable to advertisers," Altimeter Group's Solis said. "Twitter will be defined by its success in training the marketplace to understanding their value."

Twitter's business model is grounded in selling advertising to everyone from the big brands to small- to medium-sized businesses. So far portions of Madison Avenue have taken a nibble.

In an SEC filing, Twitter offered some clues into its topline, audience and the growth of mobile—key metrics and drivers for the company.

Revenue increased to $316.9 million, and the net loss narrowed to $79.4 million from 2011 to 2012, according to the filing. As a comparison, Facebook's third-quarter revenue from mobile ads represented 49 percent of Facebook's total advertising revenue for that period, or roughly $880 million. And to be clear, while Facebook is a profitable company, Twitter is pushing its stock on the the promise of future earnings.

In three months ended June 30, 75 percent of Twitter's average monthly active users accessed the platform from a mobile device, according to the SEC filing. And more than 65 percent of Twitter's advertising revenue was generated from mobile devices.

For the same three-month period, average monthly users increased by 44 percent to 218.3 million. As a comparison during the third quarter, Facebook's mobile monthly active users jumped 18 percent to 1.19 billion from the year-ago period.

In addition to revenue growth, Twitter's user base is gaining traction too, especially abroad. Solis said. Twitter plans to capitalize on its international growth, and plans to launch its self-service advertising platform in selected international markets, according to the SEC filing.

Twitter also is courting media and entertainment executives. Twitter has announced deals with CBS and ESPN among others. "Twitter's mobile ecosystem is about capturing real-time information, and the entertainment world is a natural fit. You're plugging into people's curiosity and focus," Solis said.

Even if you're not a million-dollar brand and don't buy sponsored messaging, smaller merchants already are using Twitter to broadcast products and engage customers. Through a group, or handle, called @TwitterSmallBiz, the company targets smaller merchants.

Entrepreneur Lisa Song-Sutton co-launched Sin City Cupcakes in Las Vegas last year. The staff of 16—all 30 years old and younger—have carved a niche in the crowded bakery industry with alcohol-infused cupcakes.

With more than 13,000 Twitter followers, many international customers discover the bakery through the Internet, follow it on Twitter and plan a bakery visit as part of their next Las Vegas trip. "Our tweets are short and succinct. Our potential customers remember us, when they book a trip to Las Vegas," Song-Sutton said.

Before social media, smaller merchants had turned to print outlets including community newspapers to broadcast their business. "That's the beauty of Twitter. It's like pinging your potential customers everyday," Song-Sutton said. "And it doesn't cost anything to have a Twitter account."

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