Imagine growing a tiny startup you co-founded in your 20s into a global communication juggernaut used by over 300 million people daily. Then imagine having to give it up—selling it off to another high-profile entrepreneur more than 15 years later.
This was the scenario Jack Dorsey recently faced when he made the difficult decision to sell Twitter, the real-time social media platform he helped conceive and launch back in 2006. For years, Twitter was synonymous with Dorsey—his personal brand and identity were tightly intertwined with the company‘s distinctive blue bird logo.
Yet in 2022, Dorsey decided it was time to permanently sever that connection. Why did one of Silicon Valley‘s most influential founders choose to part ways with possibly his greatest invention? Let‘s dive into the story behind Dorsey‘s decade-and-a-half journey with Twitter and the reasons he felt it was finally time to move on.
Dorsey‘s Rollercoaster Ride as Twitter CEO
To comprehend Dorsey‘s relationship with Twitter, you have to understand the company‘s origins and the ups and downs of his stints in the top role:
Founding Twitter as a Side Project
Long before hashtags and viral tweets, Dorsey was just an ambitious programmer intrigued by the idea of an SMS-based communication service. While working at Odeo, a podcasting startup he founded with Evan Williams and others in 2005, Dorsey conceived of Twitter as an internal messaging tool for employees to share quick status updates.
It evolved into a public product when developers Biz Stone and Noah Glass joined to build out the prototype which allowed users to broadcast short text messages or "tweets." The simplicity of updating in 140 characters or less about life‘s everyday moments resonated widely. Twitter was spun off from Odeo as its own company in 2006 with Dorsey as the inaugural CEO.
Ousted as CEO But Staying on as Chairman
Despite overseeing growth from 400,000 tweets per quarter to over 100 million in just two years, Dorsey was forced out as Twitter‘s CEO in 2008 by its board of directors. With Twitter rapidly expanding, some internally viewed Dorsey as too inexperienced and undisciplined of a leader compared to his co-founder Evan Williams.
Dorsey didn‘t sever ties completely—he remained on the board and retained his chairman role while Williams took over day-to-day operations. This allowed Dorsey to turn his focus to his new mobile payments startup Square in 2009.
Returning to the Helm to Get Twitter Back on Track
By 2015, Twitter was struggling to keep pace with rivals like Facebook. Growth had stagnated, stock prices were down, and then-CEO Dick Costolo resigned feeling burned out.
With the company facing turmoil, Dorsey returned as a stabilizing force, once again becoming Twitter‘s CEO. He immediately got to work trying to revitalize Twitter, including expanding its services globally, adding video features to rival the newly launched Periscope, and introducing algorithmic timelines.
However, some of Dorsey‘s product experiments didn‘t pan out. Twitter remained a digital town square for news and politics but continued losing ground to visual-forward platforms like Instagram and Snapchat which resonated more with younger users.
The Evolving Social Media Landscape Twitter Struggled to Keep Up With
During Dorsey‘s rollercoaster tenure as CEO, the social media world was transforming rapidly around Twitter, bringing new competitive threats and growth challenges:
Facebook‘s Meteoric Rise
While Twitter was designed for fast-paced public conversation, Facebook brought identity and relationships to connecting online. Launched in 2004, within 6 years Facebook skyrocketed to over 600 million users as people flocked to its news feeds and ability to discover friends and family.
Twitter hit 100 million users around the same time but its more niche, text-centric design caused it to be dwarfed 10x over by Facebook‘s broad mainstream appeal.
Instagram‘s Picture Perfect Growth
Founded in 2010 by Kevin Systrom and Mike Krieger, Instagram leapt to over 500 million monthly users in just 8 years, fueled by mobile phones with cameras allowing easy photo sharing enhanced with filters and editing.
Instagram copied some of Twitter‘s features around hashtags and @ mentions but supercharged them visually. Its Stories function also mirrored Twitter‘s concept of short updates but made them experiential using photos and video.
TikTok Takes Over With Algorithm-Powered Video
If Instagram was the first wave of mobile visual social media, TikTok took it further with its endless algorithmic feed of 15 to 60 second homemade videos set to music and augmented with effects.
TikTok crossed 1 billion monthly active users faster than any platform before it. Its addictive, video-based content left text-focused networks like Twitter in the dust.
| Platform | Users in 2010 (millions) | Users in 2022 (millions) |
|---|---|---|
| 609 | 2,936 | |
| N/A | 1,478 | |
| 106 | 237 | |
| TikTok | N/A | Over 1,000 |
While still influential, Twitter looked outdated next to these highly-engaging visual platforms optimized to keep users continually engaged. Stagnating growth became a huge business challenge.
The Challenges and Controversies Plaguing Dorsey‘s Second Tenure
Beyond competitive pressures, Dorsey‘s second stint as Twitter CEO faced other storms like misinformation controversies and calls for improved content moderation. These likely contributed to his weariness and desire for change.
Struggling to Balance Free Speech With Safety
Balancing open communication with responsible moderation bedeviled Dorsey and Twitter, especially around high-profile events like the 2020 US presidential election.
Critics slammed Twitter‘s hands-off policies after then-president Donald Trump and supporters used it to amplify election misinformation and conspiracy theories. Dorsey defended Twitter‘s approach but implemented more proactive safeguards too late for many.
Facing Pressure From Employees and Lawmakers
Employees and US lawmakers demanded more be done to curb harmful election and COVID-related misinformation. Some engineers even quit in protest of Dorsey‘s perceived inaction.
"We play an increasingly critical role in public discourse and we have a social responsibility to limit the spread of harmful content."
— Jack Dorsey internal email to employees acknowledging criticism
Dorsey struggled to reconcile Twitter‘s commitment to free speech with growing calls for accountability around its societal influence. The stress took a toll.
Why Selling Twitter Made Sense for Dorsey
Given the competitive social media landscape and Twitter‘s internal struggles, industry experts see several factors influencing Dorsey‘s move to sell the company:
Split Attention Between Twitter and Square
Since 2015, Dorsey had divided his time as CEO between Twitter and Square. Square‘s growth often took priority as Dorsey saw bigger opportunities in financial tech and digital payments.
In earnings calls, Dorsey admitted Twitter deserved a leader who could devote their full attention to tackling its challenges. Splitting his focus was not sustainable.
A Stagnant Vision for Twitter
Twitter was no longer the feisty upstart. The company likely needed a major refresh and more disruptive vision to reboot growth.
But Dorsey seemed unable or unwilling to deliver the bold product shakeup some internally felt Twitter required to thrive long-term against competitors.
Cashing Out on a Lucrative Deal
The $44 billion offer from billionaire Elon Musk to take Twitter private proved too good for Dorsey and the board to resist. Dorsey personally owned over 18 million Twitter shares meaning he pocketed well over $1 billion from the sale.
A Belief Twitter Had Outgrown Its Founders
At its core, Dorsey likely felt Twitter had simply reached a point where it needed a fresh start and new leadership. In his public statements about departing, Dorsey expressed it was time for Twitter to move beyond its founders. He seemed fully at peace passing the baton.
"I believe the company is ready to move on from its founding and founders. And the most difficult decisions ahead will require tough mindedness and a willingness to dissent."
— Jack Dorsey on realizing Twitter had outgrown him
Dorsey‘s Vision for the Future: Block, Web3 and Decentralization
Where does Dorsey go from here after 15 years helming one of the world‘s leading social platforms? He seems to be refocusing his entrepreneurial sights on financial tech as well as building an alternative decentralized internet:
Doubling Down on Block (Formerly Square)
Dorsey remains CEO of Block (formerly Square), the digital payments company he started in 2009. Block has expanded beyond payments into banking, investing, payroll and ecommerce.
Block‘s market cap now exceeds Twitter‘s. Dorsey sees financial tech as a huge frontier for innovation. He has described Block as his primary focus post-Twitter.
Exploring Decentralized Social Media With Bluesky
Dorsey has also touted web3 as the future of social media. He launched Bluesky, an initiative to develop open-source, decentralized protocols for social networks using blockchain technology.
Dorsey envisions these decentralized networks will allow users more control over algorithms and data portability between platforms—the opposite of Twitter‘s walled garden.
Betting on Bitcoin With TBD
Cryptocurrency and Bitcoin play right into Dorsey‘s decentralization vision. He started TBD in 2022 aimed at developing an open Bitcoin exchange platform not owned by any single entity, furthering web3 ideals.
The End of an Era…But Dorsey‘s Influence Lives On
It‘s the end of an era at Twitter with Dorsey‘s official departure. But his influence on contemporary communication and culture persists. Many trends like hashtags, threads, influence marketing, and real-time conversation stem directly from Twitter‘s design.
And like any great inventor, Dorsey can‘t stop dreaming up new ideas. While he‘s passed the torch at Twitter, expect his entrepreneurial energy to manifest in new projects focused on decentralizing finance, social media and information flow.
It‘s never easy moving on from a creation that defined your career and changed the world. But sometimes giving your baby wings is the ultimate act of love. For Jack Dorsey, saying goodbye to Twitter wasn‘t easy. Yet it marked a necessary step to free a global platform he helped nurture for over 16 years to sail both higher and freer.
