Why would they acquire him when they could shut him down and replicate the service? It's not like they have much of a reputation to maintain. He doesn't have extremely significant traction (otherwise they would have done something by now) and AFAICT he doesn't hold any patents.
To clarify: I don't mean to disparage him, but acquisitions have to bring some sort of value to the acquirer.
Why would they replicate this service? They'd "destroy" the function of favorites for some revenue? Are they that desperate?
These aren't ads. These are "person abc favorited your tweet" notifications that the mobile twitter client pops up, and twitter emails you. If that gets overrun by spam (a) people will turn them off and (b) favorites will be useless as a mechanism for displaying "top tweets" like they do.
The cost to Twitter of even re-discovering what it is about his API and analytics that his customers prefer to Twitter Ads could easily outweigh the cost of an acqui-hire.
The value could well be in the person they pick up rather than his product (or there could well be bits of the product that are genuinely useful to them, and a potentially interesting customer base)
He is monetizing Twitter in a way that advertisers like better than what Twitter's own advertising department came up with. That has to be worth something to a company desperate for revenue.
Given the small scale of the data points in question, there's no way to make the claim that advertisers in general like his product more than Twitter's. Even if I find that entirely plausible, I have to disagree with making such a dramatic statement without much larger scale testing.
Even in the case of this all being true, the real problem is the ability of in-house people to ignore reality and refuse to favor a not-made-here product. Always difficult to tell which way the wind will blow on that. Companies make really stupid decisions all the time.
Forget ads, advertisers would love to be able to pay to increase their follower counts. Like a force follow feature.
Make it $1 for every follower, straight-up no ads or nothing. For $100,000 I can get 100,000 more real human followers on my account. Advertisers would love that better than promoted tweets or bot favorites.
To clarify: I don't mean to disparage him, but acquisitions have to bring some sort of value to the acquirer.