The Lesson of Twitter’s Market-Shocking Surprise


The NewCo Daily: Today’s Top Stories

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First the market watchers said Twitter was shrinking — and that was not good. Then Twitter announced in its quarterly earnings report today that, actually, it is growing — and that was good. Its stock soared.

The whole financial system around tech companies, startups, and mission-driven newcos is oriented towards growth. Keep growing and you must be on the right track. Stop growing and you’re dead.

This might be a good time to think about the dangers and downside of that system, and Twitter’s story is a good test case. The company has built an incredible news and information system around brief messages and shared links. Among journalists, politicians, and “influencers,” it’s indispensable. Celebrities and brand marketers have figured out how to use it for their own ends, too. A man profoundly unqualified for the office even used it to get elected president.

Twitter is useful. But in the trajectory of venture-driven startups that go public, that is not enough. Providing value to hundreds of millions of users doesn’t cut it. Twitter has to keep growing if it wants to make investors happy, and if it doesn’t, they will abandon it.

This is a system built not to serve customers or the public or society, but to maximize investor return — and it doesn’t even do a good job at that. It helps jet-propel great new ideas like Twitter in their early stages, but then prevents them from finding equilibrium or building a sustainable long-term business. That’s bad for everyone, and it’s why we should applaud every time a company decides to explore other options — as Kickstarter and Etsy have done in becoming Public Benefit Corporations (or B-Corps), whose charters enshrine other goals alongside the customary “make investors rich.”

Growth for its own sake rarely ends well. As Edward Abbey famously said, it’s “the ideology of the cancer cell.” Companies need to unchain themselves from such narrow thinking.

Sandberg’s New Cause: Open Your Heart At Work

Sheryl Sandberg’s new book, Option B, is based on the Facebook executive’s experience coping with the sudden death of her husband two years ago. But Option B is less a self-help tome than a management handbook, writes Jessi Hempel in Backchannel.

“Sandberg is becoming the advocate for a radical approach to office openness,” Hempel says, one in which people “help take care of each other at work,” as Sandberg puts it. Sandberg discovered this herself when, a month after her loss, she opened up about it in a moving Facebook post — and received an outpouring of support. Now she’s urging businesspeople to stop drawing rigid lines between professional and personal lives and start opening up emotionally to one another.

This is going to be a valuable message for many executives, but it’s also a potentially dangerous one, particularly for less powerful workers at less successful companies. If you’re Sheryl Sandberg and you open your heart to the world, the world may love you back; but if you’re someone less fortunate or less famous, you may be greeted by armies of trolls, or indifferent silence.

The sharing of vulnerability, self-revelation, authentic personal communication — these are all things that the online world has repeatedly promised and then repeatedly screwed up. Facebook itself is our largest experiment yet in this direction. While it has enabled human communication on an unprecedented scale, it has also left many of its users feeling obligated to offer an ideal performance of their lives that’s exhausting and demoralizing.

We keep having this conversation about “being yourself” — in discussion forums and mailing lists, on blogs and social networks — and each time we face the same questions: Where does self-revelation end and too-much-information narcissism begin? How do you encourage heartfelt exchanges while protecting people from abuse? Now that the FTF office has merged with digital collaboration channels, these questions from 20 years of online interaction are everywhere.

Facebook is no more successful than its predecessors at helping us navigate such dilemmas. And at a moment when people are broadcasting murders on her social network, Sandberg may find her “open your heart” message hard to sell.

Alibaba’s Ma Sees “Pain and Conflict” Thanks to AI

Alibaba founder Jack Ma, one of China’s most successful and famous entrepreneurs, is predicting that the rise of artificial intelligence will bring us three decades of pain and social conflict (Bloomberg). People will live longer and hang onto their jobs while intelligent machines reduce the need for human labor, leading to widespread unemployment.

Whoa! Ma is usually more upbeat than that, but in a speech at a conference in Zhengzhou, he recalled how he predicted 15 years ago that online commerce would devastate traditional retailers — and no one paid attention.

“People didn’t listen because I was a nobody,” he says. This time, Ma wants us to prepare better for an imminent, inevitable change. If company leaders don’t understand why AI and cloud computing are going to transform every aspect of business, he adds, they should get a “young person” to explain it to them.

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