Let me be up front in stating that I’m not making this post to convince you to go buy Twitter shares. I am making this post to offer up a way for investors to potentially view the current state of affairs at Twitter, why these moves might be happening and how investors should feel about the picture going forward. Full disclosure: I own shares in Twitter and will continue to hold them.
The Bottom Line
This year will offer up two very big opportunities for Twitter to grow its audience in a meaningful way: the Summer Olympics in Rio in August and the US presidential election in November. Given its experiences to date in the sporting world and given Jack’s nature and Twitter’s purpose in speaking truth to power, I expect to see Twitter shine in both cases. But the burden of proof is squarely on management at this point and if they fail to capitalize, that could be all she wrote. It should be an interesting year indeed.
- The last thing Twitter investors should want right now is more of the same. By this logic, things must change. This alone should keep you from freaking out about this. If so great, you’re done. If not, read on.
- Changes in leadership can have the greatest impact (either positive or negative) on any business. With a new CEO it only makes sense that he or she is able to assemble the team(s) they see leading the business forward.
- The folks who are leaving Twitter have been a part of bringing the platform and the business to where it is today. That they are leaving is both good and bad.
- It’s bad in that they’ve obviously had a positive impact on the business and the people with whom they have worked (check their Twitter feeds…there’s plenty of positive sentiment from colleagues) and they’ve done good things for the platform.
- It’s good in that Twitter is in dire need of shedding “old school thinking” in order to move forward and these individuals arguably fall in this category given previous leadership’s priorities and strategies.
- This is what must happen in order for this business to have a chance assuming Jack and Adam are the right team for the job. It’s my view that they are the best shot this business has and I believe up for the challenge.
- Consider businesses like Facebook, Snapchat and Netflix for example. These are platforms that are still very much founder-led. Consequently they are growing, evolving and trying new things with the blessings of a founder’s vision. Something Twitter has sorely missed for a very long time. Until now.
- It is absolutely understandable that this shake-up creates uncertainty and therefore trepidation among investors in the short-run. However these moves in my view are 100% necessary for the business to have a shot at success in the long-run as an independent public company. Understand I’m saying “have a shot.” I’m not saying this is the “silver bullet.”
- It is distinctly possible that Twitter ends up being one of those “great platform, poor investment” stories. It is also distinctly possible that patient investors end up winning.
- Simply put, it’s now or never. If Twitter doesn’t evolve and grow under Jack’s tenure then Twitter is better off becoming part of something bigger. But in order for it to potentially work investors will need to give it a chance.
The Bottom Line
This year will offer up two very big opportunities for Twitter to grow its audience in a meaningful way: the Summer Olympics in Rio in August and the US presidential election in November. Given its experiences to date in the sporting world and given Jack’s nature and Twitter’s purpose in speaking truth to power, I expect to see Twitter shine in both cases. But the burden of proof is squarely on management at this point and if they fail to capitalize, that could be all she wrote. It should be an interesting year indeed.
RSS Feed
