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 Innovation/Global Risk

Twitter:  When The Idea Overcomes the Chaos

By Shlomo Maital



 Dick Costolo, Twitter CEO

In the March 1 issue of Bloomberg Business Week, Brad Stone writes about “Twitter, the Startup That Wouldn’t Die”, and about how a powerful business idea that meets a true need (perhaps, even creating that need) can overcome total business chaos.

    “Life inside successful Web startups—especially the really successful ones—can be nasty, brutish, and short. As companies grow exponentially, egos clash, investors jockey for control, and business complexities rapidly exceed the managerial abilities of the founders:  ‘the violence of a startup.’  And nowhere has the violence been fiercer, or more public, than at  Twitter.”

    “Throughout its first five years of existence, Twitter always seemed on the verge of committing some excruciating form of startup seppuku [Japanese ritual suicide by the sword].  There were constant service outages (epitomized by the ubiquitous “fail whale” cartoon message), an embarrassing security breach in 2009 that released a torrent of internal documents, and nonstop departures of key employees. The pièce de résistance was the turmoil at the top: Twitter had three chief executive officers in as many years. That drama culminated with the promotion of serial entrepreneur and former Google executive Dick Costolo as CEO in 2010 and the return last year of one of Twitter’s founders, Jack Dorsey, as executive chairman and product chief.

     “Now something freakish is happening in San Francisco. Twitter, which for years treated the responsibility of earning money as an annoying distraction, may be turning into a viable business. The company has added seasoned executives, pushed its unique symbology like the hashtag (#) and at-symbol handle (@) into the mainstream, and rolled out new advertising products to the delight of big brands such as General Motors (GM) and Budweiser (BUD), which advertised heavily on the microblog service during this year’s Super Bowl. Twitter is on pace to earn $260 million in 2012, according to research firm eMarketer”.  

The key, apparently, is Costolo, who has brought superior business skills to Twitter, and none too soon.

   There is a powerful message here for startup entrepreneurs.  Great ideas and mediocre management defeat weak ideas and superior management.  Make sure your idea is powerful, meets unwanted needs (or creates such needs) and then hang on with your fingernails…and at some point, hire a great responsible adult, when you can. 

 By all odds, Twitter should have died.  But it was simply loved and used by too many people.  Study Twitter, and Stone’s article, with care.   Get your idea out there, validate it by users, and then deal with the chaos, which in fact always exists.

Blog entries written by Prof. Shlomo Maital

Shlomo Maital
March 2012