Maybe Jack Dorsey needs to clone himself.
On July 1, the technology entrepreneur took on the challenge of turning around Twitter, the social media site that he co-founded and that he was asked to run as interim chief executive. At the same time, Dorsey has filed confidential paperwork to sell stock to the public in the other company where he is chief executive, Square, a mobile payments provider, a person briefed on the action said on Friday.
The collision of events adds fodder to one of Silicon Valley's hottest topics: How Dorsey will juggle the companies, and whether he will forgo responsibilities at one to concentrate on the other. Those questions have taken on urgency as Twitter, where Dick Costolo departed last month as chief executive, searches for a permanent leader and Dorsey's name keeps emerging among the possible candidates.
Now the filing by Square for an initial public offering further complicates the picture. Dorsey, 38, has said in recent weeks that he will remain in charge of Square. He has large financial stakes in both companies: 26 per cent of Square and 3.6 per cent of Twitter, according to recent filings.
Dorsey has become increasingly active at Twitter in recent weeks, plunging into meetings, shifting the communications strategy and getting involved in hiring. Aaron Zamost, a spokesman for Square, declined to comment. News of the Square IPO filing was earlier reported by Bloomberg. A spokeswoman for Twitter declined to comment for this story, as did a spokesman for Twitter's board.
Dorsey's roots at Square stretch to 2009, when he co-founded the start-up with James McKelvey to offer a square credit card reader to small businesses, many of which did not have the time or money to purchase the hardware needed to accept credit payments.
Square has expanded beyond its initial ambitions into lending and other types of mobile payments. Square Capital, the company's lending arm, has extended more than $100 million to more than 20,000 businesses, the company has said. Square Cash, the company's peer-to-peer payments app, processes more than $1 billion in transactions on an annualized basis. Last year, Square acquired Caviar, a food delivery service, to offer delivery to businesses that use Square.
Investors have pumped hundreds of millions of dollars into Square, valuing the San Francisco-based company at $6 billion and fueling speculation about whether it would go public. A public stock offering, which could occur as early as this year, would give Square the additional capital it needs to build out its initiatives, according to the person briefed on the situation, who spoke on the condition of anonymity.
It is unclear whether Square is profitable and what its revenue is. The company has at times encountered bumps with products that have failed, such as Square Wallet, a way to pay for goods without taking out a credit card. Companies with less than $1 billion in annual revenue can file for an IPO without publicly disclosing the paperwork until closer to the time they are ready to begin a road show for investors.
The IPO filing is not yet public. Square did disclose some details of its ownership in February in a document filed with the Department of Commerce in Alaska. According to the filing, Dorsey owns 26.2 per cent of Square, making him the largest shareholder by far. The next biggest investor is Khosla Ventures, a venture capital firm, with 17.4 per cent. Others with big stakes include McKelvey, the co-founder and a director, with 9.4 per cent.
There's little chance underwriters and auditors will let Mr. Dorsey serve as the chief executive of two publicly traded companies, according to investment bankers. That would appear to diminish the likelihood of Mr. Dorsey taking on the role of permanent chief of Twitter, which he co-founded in 2006 and where he has been chairman since 2008.
Yet while Twitter's board has been busy interviewing outside candidates for the chief executive job, some Twitter directors still hope that Mr. Dorsey will change his mind and decide he wants to keep the job, according to people close to the situation. In June, Twitter's board issued a statement saying it would consider only candidates who were in a position to make a full-time commitment to Twitter.
If Mr. Dorsey does remain committed to Square, he could retain the chairman's role at Twitter and advise the new chief executive.
So far, Mr. Dorsey has been plunging into his interim chief role at Twitter. He has been meeting with various teams to familiarize himself with their products and plans, even as the company has continued to push out a steady stream of product changes, from eliminating the background wallpaper that people see in their desktop Twitter feeds to new tools for marketers to better target their ads.
"He's been getting more involved and up to speed, but the products you've seen in the last few weeks have been in development for some time," said Ameet Ranadive, Twitter's senior director of revenue products.
Still, Mr. Dorsey has not waited to make some bold changes at the company. Shortly after his arrival, he ordered that the raw notes from the meetings of Twitter's executive leadership team - including discussion of problems - be distributed to the entire company. That mirrors similar moves he made at Square to increase transparency, where he shares presentations that he has made to the board.
Last week, Mr. Dorsey also announced a change in communications strategy. He fired Twitter's longtime communications chief, Gabriel Stricker, who had once been a close ally, according to people close to the matter, who asked to remain anonymous because the details were confidential. Mr. Stricker did not respond to a call for comment. Twitter said at the time that it was "looking now to shift our communications strategy and direction."
On Tuesday, Mr. Dorsey will face Twitter investors when he reports the San Francisco-based company's quarterly earnings. The executive has been preparing for the event, where his performance will be scrutinized.
Mr. Dorsey has also spent time at Square, which has offices about a block away from Twitter's on Market Street in San Francisco. Last week, he moderated a panel discussion on women in technology at Square's twice-monthly staff meeting, featuring three women - Sarah Friar, Alyssa Henry and Francoise Brougher - who head finance, engineering and business operations, respectively, at the mobile payments company.
During a part of the session that focused on parenting, according to a person who attended the meeting, Mr. Dorsey was asked how he managed to achieve work-life balance. He told the audience, "Uh, I don't have a family."
© 2015 The New York times News Service
