Twitter: Turn, turn, turn
On June 11, Dick Costolo announced he was standing down as CEO of Twitter and that Jack Dorsey, one of the company’s founders, was returning to take over until his replacement is found.
I sincerely believe that Dick’s time at Twitter will be remembered as an outstanding period. Considered by Business Insider as one of the most impressive CEOs in Sillicon Valley, along with Dorsey, Pinterest’s Ben Silbermann, and Aaron Levie of Box, and by Time as one of the most influential minds in technology, he is also a thoroughly nice person, with a great sense of humor and a very personal management style. But above all, he is the person behind the complex transformation that Twitter has undergone over recent years.
Dick Costolo’s exit illustrates the difficulty of being the visible leader of a company during a time when its circumstances are changing drastically. The relative difficulties that Twitter is going through as a result of its declining share price (down 14 percent on its launch in 2013) and that has even prompted speculation that it might be the target of a takeover at the right price. This is largely to do with having moved from being a small, attractive company that most people used to tell their friends what they were doing, to being a vast enterprise that is traded on the NYSE and that has become the planet’s heartbeat. Today, the world’s most influential politicians use Twitter as a communication channel, diplomats use it, business leaders use it, companies use it to keep in touch with their customers, and just about anybody who wants to know what is going on in their sector or area of interest also uses it.
Managing a transformation of this nature is enormously complex. Over the years, Twitter has succeeded in converting its acquisitions and acquihires into a major competitive advantage, evolving as a product like no other, it has been through controversies and policy changes of all stripes in a bid to fight off threats, bullying, and spam, and has at time been the center of the world’s attention. And while he was dealing with all this over the last very long four years, Dick was able to increase turnover from $4 million in the last quarter of 2009 to $1.5 billion in 2014, while the customer base grew from 25 million to 300 million over the same period. What a ride!
Today, Twitter is a completely different company to the one that Dick Costolo took over as CEO. When he arrived, the question on Twitter was “What are you doing?” Today, Twitter has plenty of users who don’t tweet at all, and not because they don’t like it; they use it to follow other people and organizations they are interested in. I have seen company directors convert Twitter into a competitive intelligence tool, a way to find out what is going on ahead of the pack, or use it to raise their profile or establish a personal brand. In short, an impressive change, and one led by a brilliant man.
Dick Costolo is moving on because Twitter has not grown or made as much money as the markets expected. But the reality is that we tend to see these results as a direct projection of the company’s activities, when this isn’t necessarily so. Many of us think that if Twitter didn’t exist, we’d have to invent it: Twitter generates a huge amount of value for users who know how to extract it, but it isn’t easy to convert that value into turnover and profits. It hasn’t been easy for Dick Costolo, and it won’t be for his successor, whoever that is.
For Jack Dorsey, who in the meantime has set up a company from scratch called Square which now is one of the most interesting electronic payment systems around, the task of taking over the running of the company he set up, will not be easy, even for a brief period of time. At this moment, nobody even knows what kind of person the company needs at its helm: a financially focused CEO, a hawk able to deal with a takeover, or a hands-on, methodical CEO who is going to put things in order and try to systematize and develop new revenue streams. Either way, it’s not going to be an easy choice. One wrong move and you could end up with a poor sale, or with a CEO who’s only interest in the bottom line.
For Twitter, it’s time to take stock of the changes of the last few years, and to decide whether it wants to be a social network when it grows up or some other type of completely different tool, and to then take the required steps in that direction. As the song says: “A time to break down, and a time to build up.” To everything there is a season.
(En español, aquí)
