Elon Musk always keeps things interesting. Ron Miller, one of the top enterprise reporters in the space, reflects on Salesforce’s past interest with Twitter as well as current discussions around Twitters independence. Was given an opportunity to comment on both. Expanded my commentary here. Bold paragraphs were included into the article.
Salesforce and Twitter are both lucky their purported $20B deal failed in 2016 | TechCrunch
Salesforce & Twitter
Back in 2016, Salesforce’s primary drivers for acquiring Twitter included: 1) social media network/graph/ID data 2) external real-time information/education for its customers, and 3) Twitter’s low valuation due to slowing growth. Marc Benioff is both a business visionary and a social good champion. The acquisition could have also served as the intersection of the two.
Other factors could have also been: a) Losing Linkedin b) Defensive play to Facebook and Google possibly entering Salesforce’s moat, and c) An avenue to the consumer marketplace, a more subtle craving for Salesforce.
However, he faced great headwinds in a highly competitive, fast-evolving social media space and during a politically turbulent election.
On paper, an acquisition may have made sense. However, Twitter’s emerging role as a democratized information platform would have required heavy resources shifted or invested in navigating privacy, procedural, and policy matters. Not to mention navigating distinctly different brands which would challenge both the trust and growth of both companies.
Even today, they collectively made the right call.
Joining Salesforce from the Slack acquisition in 2016, Bret Taylor currently remains connected to Twitter, joining the board in mid-2016 and appointed chairman last year, serving on the board which may provide at least a strategic connection and benefits.
Interesting note, in 2017, Twitter added character count and threads. These elements truly changed the way users engaged on Twitter with ‘micro-blogging’ conversations and contributed to the revenue and active user turnaround wall street and main street was yearning for.
Twitter’s ownership discussions speak directly to the ‘people are the product’ conundrum. Social media and community platforms, liken to politics, are only as good as the policies and engagement within them.
A centrally owned platform by an individual or a collective of investors is still held accountable to legal rules and societal/community policies. According to Pew, only 25% of the most active Twitter users in the US produce 97% of the content. This ‘dominance of the few’ rule could exacerbate these percentages without some central authority with checks and balances to hold bad actors accountable. Without mechanisms to ensure trust and continued performance, the collective engagement drops, and accounts go dormant or even churn.
Twitter’s challenges go far beyond the ‘edit’ button, infrastructure, or ownership. It still remains one of the lowest engaged social media platforms by active users globally.
Because it is a corporation, the Twitter community who desire independence would need to play a much more active role in its ownership. We’ve seen collective Mainstreet and Wallstreet activism before.
With Jack Dorsey’s departure, the remaining board comprises nearly all Google and Standford alumni. Also, none have a significant stake in its ownership, unusual which maybe then by design. Perhaps further diversification there both geographically and experience can begin to alleviate quality and community growth concerns.
Disclosure: I do not own Twitter, but do have stakes in Salesforce and several similar tech companies.