Twitter requires a clearer cast of characters. The resignation of Chief Operating Officer Ali Rowghani signals flagging growth and lost direction. None of the microblogging site's four founders is the controlling visionary some tech groups have. Boss Dick Costolo may be taking more of a grip. But he needs to spell out how he'll restore Twitter's fortunes.
Rowghani will "continue to work as a strategic advisor" to Costolo, but this is clearly a demotion for an executive whom employees called "co-CEO," according to the Wall Street Journal. He's just the latest in a string of departures. The company's senior vice president of engineering, for example, stepped down two weeks ago.
Growing pains - or lack thereof - at the microblogging service are one cause. Rowghani was charged with bringing in more users and developing new features. But the rate at which new Twitter users are growing has almost halved over the past year, to about 25 per cent per annum.
Twitter's penchant for infighting bears some of the blame. Figuring out who exactly runs the company verges on being a complicated logic puzzle. Founder Jack Dorsey is chairman, but also busy running payments startup Square. Co-founder Evan Williams' 9.4 per cent stake is bigger than Dorsey's four per cent, but less than the 14 percent held by investor Rizvi Traverse Management. Costolo has executive power, but less than a two per cent stake.
This is in marked contrast to Silicon Valley giants like Facebook, Google, and Oracle where founders own the biggest stakes and run their companies. Facebook and Google's founders have cemented their absolute control with super-voting stock.
Investors and employees alike understand the nature of these dictatorships. The dynamic they create is one of less dissension. That can be crucial in the early life of a company. It can, though, create more conflicts and problems than it's worth as founders age and cutting-edge technology changes.
Twitter's mess may well be sorted out over time. Early big investors, like Benchmark, will eventually sell. And actions such as demoting Rowghani may indicate a firmer hand by Costolo. The more important matter is wielding his power properly. Costolo needs to quickly figure out a way to attract new users, and keep them more engaged, for Twitter to live up to its potential.
