The reign of Jack Dorsey (a.k.a. @jack) over Twitter has come to an end. The bearded CEO and co-founder of the social-media company — who also, let’s not forget, is the CEO of Square, a $98 billion market cap payments company — resigned from the social network’s C-suite on Monday. “I want you all to know that this was my decision and I own it,” Dorsey wrote in an email to Twitter staff, which he later tweeted out. “I’m really sad … yet really happy. There aren’t many companies that get to this level. And there aren’t many founders that choose their company over their own ego. I know we’ll prove this was the right move.” Though Dorsey’s decision to run two enormous tech companies at the same time had drawn criticism for years, ultimately, the co-founder’s exit seems to have been a result of Elliott Management, one of Wall Street’s most ruthless activist hedge funds, making the case that Twitter shareholders would be better served by new leadership.
In Silicon Valley, Dorsey is not really known as a hands-on executive in the Mark Zuckerberg mold. If anything, he’s cultivated a persona as a CEO who stays above the fray, planning trips to Africa and advocating for cryptocurrencies, gushing about the benefits of intermittent fasting and his vegan diet. (That he’s kept in place a ban on Donald Trump from the platform is his biggest foray into the culture wars.) Inside Twitter, that attitude trickled down. Unlike Facebook, Twitter’s interface had hardly changed all that much prior to last year, and the newest additions — Clubhouse-style voice chats, the new tipping features — were attempts to push up the company’s stock price. Dorsey also owns just a bit over 2 percent of the shares, which made him not only an oddity among his generation of tech founders, who tend to retain control through complex stock structures, but also a prime target for an outsider to come in and push the company in a different direction.
And many had tried. Disney and Twitter were this close to a deal in 2015, but Bob Iger, the media conglomerate’s head, said he got “cold feet” and walked away. Marc Benioff, CEO of Salesforce, tried to buy the company the following year, but caved to shareholder pressure (and later attributed his reticence to a sign from the universe). It’s always struggled to grow at the levels that its bigger rivals have, making it a relative underperformer among social-media platforms, despite its wide cultural influence.
Enter Elliott. Last year, the hedge fund revealed it had a substantial stake in the company and wanted board seats and a plan from the company on how it could make more money in the future. The hedge fund is run by Republican megadonor Paul Singer, but the real force behind the Twitter pressure campaign was Jesse Cohn — a dealmaker who’s led bruising efforts for control of tech companies like SAP and Citrix, though his most notorious target is probably Athena Health. With Cohn pushing for changes at the health-care company, its then-CEO, Jonathan Bush, stepped down when a sexual-harassment claim and lewd video surfaced. So when Elliott came to Twitter last year, Dorsey looked like a dead man walking. What Cohn wanted, according to people who know him, was to make Twitter more of a central place for communication and information (and, by extension, ad revenue) at a critical time — the 2020 election. That this came right before the pandemic, when Twitter’s influence would balloon, was pure dumb luck.
Dorsey has had a complicated relationship with the company that made him one of Silicon Valley’s most iconic founders. He started it with Biz Stone and Evan Williams back in 2006, later left the company in a long tussle over control, and returned in 2015 — only to see the company’s stock crater in the months that followed. He seemed to be more focused on Square, his payments company. He was long reluctant to assess any role Twitter may have played in the rise of Donald Trump. (For what it’s worth, Trump is plotting his escape from his digital Elba through his own social-media copycat.)
But still, the last year for Dorsey was a good one. At its February peak, Twitter’s share price had tripled from the pandemic lows (now it’s up a respectable 110 percent or so). Cohn was officially replaced in June, which seemed to have defused the activist threat. Dorsey was the last of the original founding team to go, which means that, for better or worse, Twitter will now be more fully in the hands of shareholders. In his place will be CTO Parag Agrawal — @paraga on the platform he now oversees — who starts immediately, though Dorsey will stay on the board until next year. Agrawal has been at the company for about ten years, rising up from the ranks of software engineers after a career of short stints at Microsoft, Yahoo!, and AT&T, according to his LinkedIn profile. In his letter, Dorsey said Agrawal was “behind every critical decision that helped turn this company around.” As CEO, he will likely face a period of more intense demands from investors — more daily users, more content, more ways to make money — than what had been the norm during the Dorsey era. “I’ve decided to leave Twitter because I believe the company is ready to move on from its founders. My trust in Parag as Twitter’s CEO is deep,” Dorsey said in a statement. “It’s his time to lead.”