Twitter founders Jack Dorsey, Biz Stone and Evan Williams smiled happily as they posed for pictures with CEO Dick Costolo at the New York Stock Exchange as their little bird flew off to a dream start on the stock market.
But they have not been the best of friends. Dorsey, who was forced out by Williams, is now chairman of the company. Williams, who was ousted as CEO in 2010, is a director of the company and its biggest shareholder.
New York Times tech columnist Nick Bilton describes their power struggle in a new book, Hatching Twitter: A True Story of Money, Power, Friendship and Betrayal.
An Amazing Best Book of the Month for November, this is how the book is described on the Amazon website:
The book’s four central players–Ev, Jack, Biz, and Noah (Glass) –conceived of Twitter while working on Odeo, an ultimately doomed attempt to revolutionize podcasting. As their little chick grew, the four men’s personal and ideological differences led to a power struggle that eventually left them all on the sidelines as a former stand-up comedian (Dick Costolo) took Twitter into the uncertain future.
At the moment, Twitter is looking great.
No, the Twitter IPO Is Not a Sign of a Tech Bubble http://t.co/HPwTOTTXh6
— Mashable (@mashable) November 8, 2013
If Twitter IPO'd in 1999, it wouldn't even make the top 25 first-day gainers of that year: http://t.co/BgG8dkYieC
— Alexis C. Madrigal (@alexismadrigal) November 7, 2013
Twitter Inc. (TWTR:US) jumped 73 per cent in its trading debut. It rose to $44.90 at the close in New York from the initial public offering price of $26, delivering the biggest one-day pop for an IPO that raised more than $1 billion since Alibaba.com Ltd. debuted in 2007, reported Bloomberg. Twitter sold 70 million shares, raising $1.82 billion.
The San Francisco-based microblogging website picked a price that valued it higher than Facebook Inc. (FB:US) even though it is unprofitable and has one-fifth as many users as Facebook, added Bloomberg.
Twitter founders’ shares and net worth
So, yes, the Twitter founders had every reason to smile. Reuters says:
- Williams, who holds 12 per cent of the shares, is estimated to be worth $2.5 billion.
- Dorsey, with 4.9 per cent of the stock, is estimated to be worth $1.05 billion.
- Costolo, with 1.6 per cent, is estimated to be worth $344.6 billion.
Stone, who left Twitter in 2011, is estimated to be worth $200 million, but it’s not known if he has any Twitter shares. When Twitter filed for the IPO, the S-1 filing did not mention if he has any Twitter shares. That could be because he no longer works for Twitter and does not own more than 5 per cent of the stock, said Fast Company.
Their fallouts are described in the Los Angles Times’ review of Hatching Twitter. The reviewer Matt Pierce writes:
New York Times tech columnist Nick Bilton’s new book, Hatching Twitter: A True Story of Money, Power, Friendship, and Betrayal,” offers an inside account of the Silicon Valley screw-ups who stumbled, bickered and betrayed their way into creating a media empire.
Twitter was first born in 2006 after its creators’ previous company, the podcasting service Odeo, was instantly wiped out when Apple decided to add a similar feature to iTunes.
Bilton’s book pegs the light-bulb moment to a drunken exchange between Odeo employees Jack Dorsey and Noah Glass as they are mourning Odeo’s demise. Both men would help develop the idea for Twitter but did not survive its growth, which is where “Hatching Twitter” draws much of its drama.
Glass, depicted as a lovable loser in search of human connection, would be ejected over creative differences and largely scrubbed from Twitter’s official history. Dorsey became Twitter’s first CEO but did such a poor job that he also got forced out.
Though much of “Hatching Twitter” is hobbled by weak anecdotes and schlocky metaphors, the book is carried by Bilton’s excruciating account of Dorsey’s evolution.
First, Dorsey is a willowy eccentric with an inappropriate romantic fixation on a co-worker. Next, he’s demoted to powerless figurehead. Then, Dorsey starts massaging his image with every reporter who will listen; he starts calling himself Twitter’s “inventor,” creepily repatterns his speech after Steve Jobs and fumes to Barbara Walters about being left off Time magazine’s 100 most influential people list.
Ultimately, Dorsey’s successful comeback to the company happens by way of a boardroom coup against co-founder and former friend Evan Williams.
“I invented Twitter,” Dorsey protests to Williams before the coup in one of the book’s most compelling passages.
“No, you didn’t invent Twitter,” Williams replied, adding that nor did he. “People don’t invent things on the Internet. They simply expand on an idea that already exists.”
Throughout “Hatching Twitter, Bilton frames the service’s development as a competition between Dorsey’s vision of Twitter as a status-update service and Williams’ concept of a unique news platform. But this is the Great Man version of Twitter’s history.
In reality it was Twitter users, not the founders, who informally invented the use of @ symbols, the hashtag and the retweet, the service’s three most powerful functions.
Throughout Hatching Twitter co-founder Biz Stone, treated as the company’s moral conscience, insists that Twitter remain a “neutral technology,” which is, of course, impossible.
During the Iranian protests in 2009, when the US State Department urged Twitter to put off service maintenance during a planned protest, Stone remarks, “We don’t know who the good guys are or who the bad guys are,” then adds, “Wait, are there any good guys?”
Good question. In either case, Twitter did as the State Department asked.
Twitter’s hidden technology
Paul Ford in Bloomberg Businessweek describes “The hidden technology that makes Twitter huge”. A tweet is complex, created to last, he says:
“It’s short—140 characters and done—but hardly simple. If you open one up and look inside, you’ll see a remarkable clockwork, with 31 publicly documented data fields. Why do these tweets, typically born of a stray impulse, need to carry all this data with them?
“While a tweet thrives in its timeline, among the other tweets, it’s also designed to stand on its own, forever. Any tweet might show up embedded inside a million different websites. It may be called up and re-displayed years after posting. For all their supposed ephemerality, tweets have real staying power.”
I love Twitter. It’s a great place to read breaking news. And it has social savvy. It showed at the IPO.
Twitter wanted to thank its users. So instead of the Twitter founders ringing the opening bell for the IPO, three Twitter users rang the bell – actor Patrick Stewart (Captain Picard of Star Trek fame), who has 723,000 Twitter followers, nine-year-old Bay Area girl Vivienne Harr (22,000 followers ) who kept a lemonade stand for 365 days to raise awareness of child slavery across the globe, and officer Cheryl Fiandaca who represented the Boston Police, who used Twitter after the Boston Marathon bombings.