Twitter Has a New CEO: What to Expect

Dec 2, 2021

Stock101

What To Expect From Twitter With Its New Ceo

On Monday, November 29, 2021, Jack Dorsey announced to leave Twitter as its CEO. The announcement was quite strange and unplanned, but it has been in the works for a while. Parag Agrawal, the new CEO, is a familiar figure in the social media company, having a decade-long experience with Twitter and acting as its chief technology officer since 2017.

In Jack Dorsey’s words, he left Twitter because he believed it was the right time to move on from founder-based leadership. He also announced that he trusts Parag as the new CEO, seeing his contribution to Twitter since he joined the ship ten years ago.

Jack Dorsey will remain a board member until the 2022 Twitter annual shareholders’ meeting. However, his role will be limited to helping the new CEO adapt to his role and facilitate the transition. Twitter shares ($TWTR) jumped at this news during the pre-trading hours but came back to earth before the end of the trading day.

The Prelude To Twitter's CEO Resignation

Jack Dorsey’s decision to resign has always been coming, and this is the second time he is leaving Twitter. The first time wasn’t this smooth, and it wasn’t even a resignation. In Steve Job-esque fashion, Jack Dorsey was moved from the Twitter community at the second round of funding. Twitter was still private and had some outage issues plaguing it. Jack showed no signs of solving the issue and was fond of leaving work early to attend fashion design and yoga classes. Two board members, William and Fred Wilson, rallied to dismiss Jack as CEO.

The second coming of Jack Dorsey was almost like that of Steve Jobs, as he emulated many of Job’s traits, which caused some more friction amongst the board members. Fortunately, Twitter went public, and Jack Dorsey tasted being a billionaire. But the disgruntled never died, and as the popular saying goes, “what is dead may never die, but rises harder and stronger,” it only got worse. There have been many issues over him being a part-time CEO, as he also runs a payment processing company, Square.

In 2020, Elliott Investment Management prompted Jack’s resignation and some extra steam from Silver Lake (a private equity firm). The fire was only quenched when both parties were placed on the board. However, it was clear a more mature Jack Dorsey started looking for a replacement and a good succession plan from that moment. While their claims were valid, Jack’s response to this has been underwhelming. Twitter has stalled at 300 million unique users compared to Facebook’s 2 billion users; there’s much work to be done. All eyes will be on Parag Agrawal to steer the ship through the tides.

PARAG AGRAWAL- Resume

Parag Agrawal, the new Twitter CEO, will be different in style and approach, but as his profile has shown us, we expect to see a very proactive Parag in his approach. After a brief stint at Microsoft, AT&T, and Yahoo, Parag joined Twitter in 2021 as an engineer. His first job was addressing ad products, and his work rate earned him the title “distinguished engineer.”

Although, he hasn’t been a very public figure either within the company or outside it, as he is poised to come in direct contact with Wall Street: something Jack Dorsey dodged for years. Most notably, Parag was responsible for fixing Twitter’s racial cropping issues of 2020, which showed discriminatory tendencies towards people of different demography, and the 2018 password bug that caused a major security breach of the network.

Parag will be entitled to a take-home salary of $ 1 million per year, with a 150% annual raise in his new role. He will also receive $12.5 million in restricted stocks and another $12.5 million in performance-based stock options.

Which Direction for Twitter?

Big tech companies are known to have the founder lurking somewhere in the shadows, as it has been proven there is no company too big to fail, but if we are going to follow results from Google and Microsoft, Twitter is poised for a massive bull run, both as a company and as a stock.
In a 2020 interview with MIT, Parag hinted that the main issue with the platform is moderation. Following Donald Trump’s row with the company, it is clear that Parag will be looking to create a conducive environment for healthy conversations. Although he pointed out that this doesn’t mean being a middleman between truth and falsehood, it is important to avoid misinformation and its effects.
With the growth of decentralization and more decentralized platforms, it is just time that stands between the current social media platform and a new decentralized platform. Parag will have a lot on his hands in modernizing Twitter’s tech. Thankfully, he has enough experience with the company and the product to stand up to this task.

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