The rumors buzzing around this summer have today been confirmed: Saudi Prince Alwaleed bin Talal has invested $300 million in social media site Twitter through his investment company, Kingdom Holding, acquiring a strategic stake as the site moves to woo international advertisers.

Coming on the heels of Zynga’s $1 billion IPO on Friday and rumors that Facebook may file for an IPO at a $100 billion valuation before the end of the year, Alwaleed’s investment may value Twitter at around $10 billion, Bloomberg reports. Since its current revenue is reportedly around $140 million ($100 million of which comes from ads), this positions its valuation at around 70 times its revenue- certainly high.

Yet the investment will crucially enable Twitter, which has long focused on userbase rather than profitability, to potentially boost its ad revenue by around 86 percent with redesigns in the coming year.

An round of $800 million in funding led by Digital Sky Technologies this August valued Twitter at $8 billion, despite the ups and downs the site has seen since its founding in 2006. Having cycled through co-founders Jack Dorsey and Evan Williams as CEO before installing COO Dick Costolo this year, perhaps the microblogging site will gain steady footing with investment from Alwaleed, who was ranked the richest businessman in the Arab World by Arabian Business this year.

The move may seem risky for Alwaleed, yet he may be looking simply to benefit from the curent social media boom, especially in the wake of protests in the Arab World this spring, during which Twitter became a popular means of disseminating information. The total number of twitter users in the Arab World grew to over 6.5 million by the end of March 2011, according to the Dubai School of Government’s second Arab Social Media Report.

Yet as the volume of daily tweets in Saudi Arabia also rose seven-fold in March 2011 alone, following protests in the country, there has been some clamoring on, well, Twitter, that perhaps Alwaleed’s interest extends beyond revamping Twitter’s business model. Prominent internet censorship critic Evgeny Morozov tweeted, “How to preempt a "Twitter Revolution": Saudi prince buys a $300 million ‘strategic stake’ in Twitter.” Yet others quickly pointed out that Alwaleed and Kingdom Holdings also hold a stake in Apple, and no one’s worried about his influence on the iPhone.

Most importantly for users, Twitter’s move towards a sustainable revenue stream will ensure that it continues to function as a top site for worldwide breaking news and on-the-ground reporting in real time, whether that’s coverage of a protest, another concert, or the (wink wink) latest vote for the Best Startups of 2011 on Wamda. 

[photo from Arabian Business]