Elon Musk, who acquired Twitter for $44 billion in October, is in the market for a new Twitter CEO. Musk currently holds the CEO title, but in December, he stated that “I frankly don’t want to be the CEO of any company.”
The shareholders of Tesla, another one of Musk’s companies which, unlike Twitter, is still publicly traded, have signaled they would like Mr. Musk to concentrate more of his management attention on the EV company, whose share price dropped during the Twitter acquisition drama and its aftermath.
But Tesla shareholders are not the only ones suggesting Musk give up the CEO role at Twitter. Musk conducted a straw poll in mid-December on Twitter, asking if he should relinquish the CEO role. Of the 17.5 million users who responded, 57.5% said “yes.”
Musk said he would accede to the wishes of the majority and called for candidates, but then tweeted this: “No one wants the job who can actually keep the company alive. There is no successor.”
But let us assume for a moment that there is a genuine effort to find a new Twitter CEO. What traits would that person need to possess? What competitive challenges would that individual face? And how, exactly, would you deal with Musk, who not only owns the company but is famously mercurial?
It is important to put all of this in historical context. Twitter was founded in 2006 by Jack Dorsey and other Silicon Valley entrepreneurs. The company has an iconic brand and, as of 2022, had over 360 million active users worldwide.
That is the good news. What Twitter has thus far failed to do, in contrast to Google, Facebook, and even LinkedIn, is effectively “monetize” its brand. A succession of CEO’s including Dorsey, Evan Williams, and Parag Agrawal, all struggled to crack this nut. The company is not profitable. In 2021, on $5 billion in revenues, it suffered a loss of $220 million.
Add to this the company’s very mixed record on the topic of free speech vs. civility. Hailed in 2011 for its role in promoting democratic reform during the Arab Spring, and in 2014 for its utility in helping to mobilize voters and electing Barak Obama as the first African American President of the United States, it also was increasingly used to promote racist, misogynistic, and anti-Semitic tropes.
Plus, there was the matter of Donald Trump, whose tweets gave new meaning to the expression “stretching the truth.” (Trump was kicked off the platform in 2021; Musk invited him back recently, but thus far, the ex-president has demurred.)
Will Musk give a new Twitter CEO the chance to succeed?
Given all of this, does taking up the position as Twitter CEO in 2023 represent a mission impossible – or the opportunity of a lifetime?
There is an expression for such an impossible assignment – “It’s like giving a kamikaze pilot a two-ship quota.” But it could also present a unique career opportunity. Think of Lou Gerstner, who became CEO of the faltering tech giant IBM and turned things around. Of such things are legends made.
Gerstner’s case is instructive – a former McKinsey partner, he had previously headed up RJR Nabisco and American Express, neither of which operated in the tech space other than as consumers of enabling platforms. This suggests that Twitter’s next CEO need not come from Silicon Valley.
The financial press, perhaps predictably, has largely focused on high-profile candidates, including former Facebook COO Sheryl Sandberg and that company’s former CIO, Mike Schroepfer.
Both have the advantage of having navigated in and around a sometimes-challenging Mark Zuckerberg. Sandberg, in particular, is aware of the challenges around free speech, privacy, and monetization.
CNBC and Forbes have also mentioned the folks who have been helping Musk run Twitter since the takeover, including Jason Calacanis, entrepreneur and investor, and David Sacks, another investor, one with Pay Pal experience.
As someone who has spent several decades as an executive search professional, I would advise looking less at prominent names, and more at the problems that need to be solved. Once those are identified, we can take the next step and do a deep, exhaustive search to find the right candidate.
So what needs to be addressed by an incoming CEO?
First of all, stabilize the patient. Twitter’s workforce has been traumatized over the past four months, with many employees either being shown the door or heading for the exits. Much as happened at IBM with Gerstner, the new leader needs to steady the ship, even while signaling that change is in the offing.
Twitter management also needs to deal decisively with blatant hate speech, including incitements to violence, and the amplification of racist, Islamophobic, and anti-Semitic messaging. While Elon Musk is on record as favoring free speech, creating clear boundaries is paramount to maintaining the integrity of the brand. Closely aligned are issues around security and privacy.
Another challenge facing an incoming CEO at Twitter is the company’s persistent struggle to effectively monetize its strong brand image and user community.
While it is true that the term “tweet” and the name Twitter are synonymous with our modern technology-driven culture, the company needs to generate profit, either through subscription services, advertising, some combination of the two, or some other approach.
According to Statista, Twitter only accounted for 0.9% of digital advertising revenue in 2021. As bad as that sounds, things got worse in 2022. Ad volume dropped by 50% in November of last year, according to Forbes.
This hemorrhaging needs to be staunched quickly. In the short term, advertisers need to be reassured that the platform is stabilized and in good hands.
But the real challenge is that the company needs to innovate, much as Google, Facebook, and Netflix have.
There needs to be a clear-eyed assessment of the blue mark subscription model. The same is true of Twitter Spaces. Twitter Spaces is a live audio conversation feature within the Twitter app that allows users with more than 600 followers to create audio chat rooms as hosts or join them as speakers or listeners. You can call it a podcast, which is live and open for all to join.
Twitter touts it as a way to build brands. It is potentially a step in addressing the rapid evolution of the web, including Web3, which encompasses a decentralized online ecosystem based on blockchain.
Which brings us to the next challenge before Twitter: user attraction and satisfaction.
As Twitter investor Chris Sacco put it almost a decade ago, “Almost one billion people have tried Twitter and not stuck around.” Although no numbers have been released recently, it seems safe to say active users are in decline.
The firm needs to launch new and innovative offerings to gain significant traction with users.
The next CEO should be someone who pushes the platform forward while staying in the good graces of Mr. Musk.
And I would recommend that Mr. Musk look beyond the so-called “usual suspects” of current and former technology CEOs and COOs. No doubt Mr. Musk has a strong professional network and solid contacts, but that is probably not enough. He would be wise to employ a disciplined, customized process to find candidates and select the one who can best take Twitter to the next level.
Elon Musk says no one who is capable of running the company wants the job. That is because he has not looked hard enough, or in the right places. The real question is, even if he finds the right person, will he allow him or her the space to get on with the job? If he does, it is a great opportunity. If not, it is mission impossible.