4 June, 2015

Twitter’s Value

Chris Sacca’s ever hopeful What Twitter Could Be is quite a read. Too long and often meandering, it nevertheless shows how deeply he thinks about every aspect of Twitter as a product and a business. I like to imagine a hush fell over Twitter HQ as the entire staff took the time to read then re-read the entire thing.

Sacca lays out a way to capture a bigger audience and reinvigorate what, from the outside at least, looks like a muddled company. He shifts from grand strategic thinking (“live is the biggest opportunity yet”) to very specific feature recommendations1. There are several great product ideas buried in the post worth pursuing — by Twitter, some plucky upstart, or even more established companies.

Sacca insists Twitter’s problems are the result of not telling its story, either to investors, potential new users, or users who have abandoned the platform. That strikes me as charitable, not just because telling the right story is a fundamental purpose of any business, but because it seems like Twitter itself doesn’t know what story to tell.

More than monthly active users or revenue growth, this lack of direction is the most troubling. Twitter has a mission statement — “to give everyone the power to create and share ideas and information instantly, without barriers” — that expresses a purpose, but they seem to lack foundational values2. This has led to a near-perennial change in direction that for now seems to be focused on live events and broadcast, especially with the Periscope3 acquisition.

It wasn’t an investor or analyst who identified Twitter’s primary tension but, fittingly, writer and artist Teju Cole when he noted it’s a genuinely novel form of communication but also a corporation. Others have made similar points, that Twitter wasn’t so much invented as discovered, and everything fundamental to how Twitter works was built by the people who use it, not the company itself.

This tension has made capturing the value of Twitter from the top down elusive, however, there’s something perhaps just as valuable: the individual corpus of every user’s interests and passions. Twitter has one of the biggest data stores in the world, maybe the value is in all of the little data. Mining the big data of all of Twitter is interesting for knowing what’s happening all over the world, but giving everyone who uses Twitter insight into everything they care about is equally valuable and, potentially, much more lucrative. To make this work would require unwinding years of strategy, starting with reversing the infamous v1.1 of the API. It would mean not merely competing for users to show ads to, a la Facebook, and not insisting on a top-down, completely controlled approach to product development like Apple. It would mean more third-party apps and letting Meerkat exist alongside Periscope.

Everyone who wanted a microblog or novel communication app signed up for Twitter long ago. The question Twitter can answer for everyone else is how do they connect to everything they care about.

  1. An unapologetic hustler, many of these naturally end in Twitter acquiring one of Sacca’s portfolio companies. 

  2. This may be because none of Twitter’s founding members are currently at the company, though there’s no indication any of the founders would be any better than the current leadership. 

  3. Periscope is fascinating because it is attempting to replace timeshifting with placeshifting, contra to nearly every change in media in the past 20 years, though maybe more interesting with the rise of consumer VR. Sacca is particularly enamored with the product and is, in fact, Periscope’s biggest booster. I wonder if there’s a certain wistfulness at work here, wishing that Twitter was dominant in the way that Facebook is, perhaps with Instagram on its side rather than as a competitor. Sacca doesn’t strike me as the overly-emotional type, and he’s spread his bets out such that he’s profited handsomely regardless of who’s on top, but you get the sense that Twitter is what’s closest to his heart.