Step aside, Mark Zuckerberg, Jeff Bezos, and Marc Benioff—it is time to make room for another remarkable leader in the already-packed club of great tech industry executives. Indeed, after the incredible 2017 that both—yes,
both—of his companies just had, Jack Dorsey is officially a top-tier CEO.
Not many internet entrepreneurs can say that they founded multiple billion-dollar companies in their lifetime, and even fewer can boast that accomplishment at the ripe age of 41 years old. Only Dorsey can say that he has done all of that in the face of unwavering criticism and a never-ending stream of challenges.
Dorsey was re-named the full-time CEO of Twitter (
TWTR Quick Quote TWTR - Free Report) in October 2015, almost exactly seven years after he left the position to become chairman of the micro-blogging platform. Upon taking over, he had several pressing questions to answer—namely how he would juggle his time between Twitter and his payments company, Square Inc. SQ, where he also served as CEO.
At the time, Twitter was struggling. The stock had lost more than 60% since its post-IPO highs more than a year and a half earlier, and the company’s months-long search for a new, outside chief executive proved fruitless. Meanwhile, Square was gearing up for an IPO and dealing with the unique pressures that face young tech firms.
The Dorsey experiment almost proved to be a failure. Square dipped below its offering price in the months following its market debut, and Twitter’s 2016 was marred by an executive exodus that witnessed the departure of more than half of its leadership team.
Almost exactly a year ago, I questioned whether Dorsey was the right man for the turnaround effort that Twitter desperately needed. Shares were down nearly 30% over the past 12 months, and the resignations of the company’s CTO and V.P of product seemed to indicate a complete lack of faith in its leader (read more:
Twitter Stock Tumbles Again, Is It Time To Fire Dorsey?).
It is with great pleasure that I can now say my calls for Dorsey’s firing were premature. Just as criticism of the young executive reached its peak, the dual CEO helped his companies become two of the year’s hottest tech stocks. Shares of Square have gained over 150%, while Twitter has moved about 50% higher.
Twitter still needs to prove that it can monetize its user base more efficiently, but the social media company has inspired optimism thanks to a variety of new initiatives. Despite the failure of its Thursday Night Football streaming last year, Twitter doubled down on live video and through new efforts, like its partnership with
Bloomberg, seems poised to become a legitimate original content contender.
At the same time, Square locked up consistent profitability. The payments company also boosted its top line by expanding internationally and delving further into traditional financial operations—including small business lending.
Square also proved that it is willing to test the waters with technology that could stand to revolutionize the financial industry. In November, Square began testing support for bitcoin through its mobile application, Cash App. A company spokesperson told
CNBC that the firm believes cryptocurrency “can greatly impact the ability of individuals to participate in the global financial system and we're excited to learn more here.”
Nevertheless, 2017 has also included its fair share of challenges for Dorsey’s companies. Most notably, Twitter found itself at the center of a national debate surrounding Russia’s propaganda campaign during our most recent election cycle, and management did not necessarily resolve all the concerns about abuse on its platform.
But there is a reason we are seeing a level of optimism about Twitter that has not be felt since early 2014, and Dorsey deserves a lot of the credit for getting his companies pointed in the right direction.
Last week, Twitter shares surged to a new 52-week high after JPMorgan analysts published a bullish note on the once-struggling stock. The firm upgraded Twitter from “Hold” to “Overweight” and raised its price target to $27 from $20.
“We believe both the TWTR story and financial results will strengthen over the next year as the company continues to build on its differentiated value proposition for users & returns to revenue growth,” JPMorgan’s Doug Anmuth wrote.
Last year, there were calls for Dorsey’s resignation. One year later, one of Wall Street’s top research institution declared the stock one of its top small-to-mid-cap picks for 2018. That is the type of recovery that deserves to be recognized.
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