Jack Dorsey has stepped down as Twitter's CEO 16 years after co-founding the company and will be replaced by CTO Parag Agrawal (pictured right) effective immediately. At the same time, Salesforce's president and COO, Bret Taylor, has been elevated to board chair. Dorsey (pictured left) will serve on the board through his term until approximately May to help Agrawal and Taylor with the transition.
"I believe it's really important to give Agrawal the space he needs to learn," Dorsey said in an email screenshot which he tweeted. He explained that the board ran "a rigorous process considering all options" and Agrawal was unanimously appointed. Dorsey described Agrawal to be "curious, probing, rational, creative, demanding, self-aware, and humble".
"He's been my choice for some time given how deeply he understands the company and its needs. Agrawal has been behind every critical decision that helped turn this company around," Dorsey said. Agrawal joined the team in 2011 as a distinguished software engineer, according to his LinkedIn. Before that, he was on AT&T Labs' research team. He also worked in research at Microsoft and Yahoo! .
Agrawal tweeted that he has deep gratitude for Dorsey and the entire team. In the email screenshot, Agrawal explained that he is also honoured and humbled, and grateful for the service that Dorsey has built, the culture, soul, and purpose the former CEO has fostered among employees. Agrawal was also grateful for the trust that Dorsey has put in him. "I joined this company 10 years ago when there were fewer than 1,000 employees. While it was a decade ago, those days feel like yesterday to me," he said.
Meanwhile, Taylor joined the board in 2016 and Dorsey said "he has been excellent in every way". "He understands entrepreneurship, taking risks, companies at massive scale, technology, product, and he's an engineer," Dorsey said.
While there has been plenty of chatter about the importance of a company being founder-led, Dorsey believes that to be "severely limiting and a single point of failure". "I have worked hard to ensure this company can break away from its founding and founders," he added.
In addition to his role at Twitter, Dorsey is also CEO of Square, a digital payments company. According to the Wall Street Journal , his dual roles and external hobbies have drawn criticism. Last year, investor Elliott Management Corp also pushed for changes within Twitter, WSJ said. The social media company eventually reached an agreement with Elliott last March in which Twitter will appoint two board members and commit to US$2 billion in share buybacks. WSJ added that the agreement also comprised the creation of a new committee to study Twitter's leadership.
Dorsey was previously fired in 2008 over concerns regarding his management and absenteeism but returned in 2015, WSJ added. Twitter shares rose as much as 11% during an initial report of Dorsey's departure but halted ahead of the announcement. According to WSJ , the stock eventually fell 2.7% to US$45.78 and ended a day lower.
Dorsey stepping down as Twitter's CEO comes at a pivotal time for the company, which will now have a CEO who is singularly focused on the company versus splitting their time between two, Forrester's VP and research director, Mike Proulx, said. He added:
Naming Agrawal as the new CEO positions Twitter for the metaverse-era of the Internet by doubling down on a feature-rich product roadmap that helps differentiate Twitter to attract the TikTok-loyal Gen Z audience.
That said, Agrawal still has his work cut out for him. Proulx explained that with social media under increased public scrutiny due to mental health and misinformation issues, the new CEO's focus will be torn from product and platform design towards policy decision making.
Twitter is not the only tech company to have seen a major leadership change over the years. Andrew Jassy, for example, took over the Amazon CEO reins from Jeff Bezos earlier this year. Google co-founders Larry Page and Sergey Brin also gave up their respective roles as CEO and president of Alphabet in 2019. Both remain shareholders and members of Alphabet's board of directors.
Meanwhile, Jack Ma also made headlines when he stepped down as Alibaba Group's founder and executive chairman in 2018. Like Dorsey, these founders are closely tied to the company they have built and have also created a following over time. Ambrish Chaudhry, Superunion's MD, Singapore, India and Indonesia, previously told MARKETING-INTERACTIVE that the "cult of the celebrity founder" is somewhat a double-edged sword. It is advantageous in getting recognition and visibility for the company and attracting talent, but it can also be counterproductive if it begins to overshadow other positive aspects of the company.
He also explained that "cult leaders" can also get people to buy in and align with their vision. "Even if they are not around, their presence and imprint on the company's culture remain, and that perhaps is their biggest legacy," Chaudhry said.
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