Jack Dorsey, the chief executive of payment processing platform Square, has had a pretty landmark year so far. The tech mogul, who also founded and heads social media platform Twitter, has found his position as the company’s head under threat since 2020 began. However, he appears to have scored a major win.
Enemies on the Prowl
Earlier this week, Bloomberg reported that the board of Twitter had decided to stick with Dorsey at the helm of affairs following an evaluation of the company’s performance. The decision will come as a relief to Dorsey and his fans who have watched the CEO come under fire from several angles.
Dorsey’s ordeal is coming amid criticism from several of Twitter’s investors and board members. Chief among them is the billionaire and activist investor Paul Singer. Singer through his investment firm, Elliott Management, gained seats on Twitter’s board and purchased a not-insignificant amount of the company’s shares.
This year, Elliott Management, along with private equity firm Silver Lake, pushed for Dorsey’s removal as Twitter’s chief executive. According to a CNBC article in February, Singer explained that Dorsey regularly splits his time between Twitter and Square. With both companies worth north of $30 billion individually, Singer said that Dorsey would be unable to give his time to running the social media giant efficiently.
The activist investor also raised concerns with what appeared to be Dorsey’s obsession with Africa. The Twitter CEO went on a much-publicized tour of the continent late last year, visiting Nigeria and Ghana especially. On his trip, Dorsey met with several of the countries’ tech entrepreneurs, although he also spent a great deal of his time meeting with crypto industry leaders.
Following his trip, Dorsey proclaimed that he planned to move to an African country for three to six months in 2020. Singer raised this issue as well, explaining that it meant a lack of commitment to Twitter and its growth.
Sad to be leaving the continent…for now. Africa will define the future (especially the bitcoin one!). Not sure where yet, but I’ll be living here for 3-6 months mid 2020. Grateful I was able to experience a small part. 🌍 pic.twitter.com/9VqgbhCXWd
— jack (@jack) November 27, 2019
The debacle eventually ended in March, with Elliott investing $2 billion for board seats on Twitter. Silver Lake also got board seats after committing $1 billion to the company, per an NBC report.
Problems Still Linger
As this week’s report explains, the board had found Twitter’s performance to be satisfactory so far. To that end, Dorsey would retain his spot as the company’s CEO.
“The committee expressed its confidence in management and recommended that the current structure remain in place. […] The board will continue to evaluate company and management performance according to a range of factors, including the company’s operating plan and established milestones,” the report explained.
While he lives to fight another day, Dorsey is barely out of the woods yet. Per the report, the committee has prepared a plan to reduce Twitter directors’ terms from three years to one. The move means that Elliott and Silver Lake could replace board members if they want to swallow up more power for themselves at the firm. Ultimately, they could be gunning for the big man himself.