A Twitter shareholder identified as Scott Galloway has called for the sack of the social media’s CEO and Co-founder Jack Dorsey over the latter’s plans to relocate to Nigeria come next year.
You would recall that we had shared Jack Dorsey’s announcement via his twitter account that he would be relocating to Africa come 2020 some days ago. Read it here.
See a copy of his letter transmitted to the platform’s board below:
To:
Omid R. Kordestani
Executive Chairman
Twitter, Inc.
1355 Market Street, Suite 900
San Francisco, CA 94103
Mr. Kordestani,
A part-time CEO who is relocating to Africa? Enough already.
My name is Scott Galloway (@profgalloway). I am a professor of marketing at NYU’s Stern School of Business, an entrepreneur, and a US citizen. As of 12/6, I am the direct and beneficial owner of approximately 334,000 shares in Twitter. I reserve the right to establish a dialogue with like-minded shareholders regarding the nomination of class III directors and/or a resolution of “no confidence” concerning you and CEO Jack Dorsey for consideration at your annual shareholder meeting in May.
To be clear, my primary objective is the replacement of CEO Jack Dorsey. However, your firm’s weapons of mass entrenchment include a staggered board that may force shareholders to seek to replace other directors, including yourself, first.
Twitter has, on every metric, underperformed peers for several years. Since Mr. Dorsey’s return to the firm in July 2015, shareholder return is -15%, vs. Google +153%, Facebook +129%, the S&P 500 +50%, Dow Jones U.S. Media Index +29%, and MSCI tech index +115%. The stock has experienced substantial contraction of its earnings multiple as the market is losing confidence in management, the board, and the firm’s prospects. Today, Twitter’s multiple on earnings is lower than media firms including:
This decline is despite the fact – and I trust we can find common ground here – that Twitter has become an iconic brand and the global heartbeat for our information age. The only firms with the reach and influence of Twitter (Tencent, Facebook, and Google) register 17x, 24x, and 39x the market capitalization, respectively.
Greatness is in the agency of others, and many talented executives have left the firm. It is difficult to ask people to work evenings and weekends when the CEO works mornings (is part time). The exodus has resulted in anemic product development that has stunted growth and monetization. The poor performance has been somewhat wallpapered over by President Trump. His decision to communicate and govern via 280 characters creates a sugar high that masks the underperformance of management, and will not last. Few people have benefited more from Donald Trump’s election than Jack Dorsey.
