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Jack Dorsey Steps Down as CEO of Twitter

Twitter Founder and CEO Jack Dorsey announced his departure from the company — what does this mean for Twitter and Square?

In retrospect, it appears that this news has been a long time coming. To manage a multi-billion dollar company is one thing, but to take the lead role for two is a huge task for anyone. Jack Dorsey will step down, but he will remain on the board of directors and he still owns roughly 2% of the social media platform. 

Who will Twitter’s new CEO be?

The new CEO will be Parag Agrawal, the former Chief Technology Officer at Twitter (NASDAQ: TWTR). Agrawal has a Ph.D. in computer science and has worked for the likes of AT&T and Microsoft before he joined Twitter. It was unanimously decided for him to replace Dorsey as CEO and Agrawal has been recognized for his deep understanding of Twitter’s business and its needs.

Additionally, he was central in the development of Project BlueSky, a move towards decentralization of social media and a shared vision of integrating the functionality of cryptocurrencies on the platform. 

What does this mean for Twitter?

Twitter is in safe hands with Agrawal; a highly experienced individual that can take charge of the platform’s ambitious efforts. It isn’t the first time in history that a company has lost its visionary founder either — think of Apple, Google, and most recently, Amazon for example — it didn’t slow down business growth there.

Once the business has reached a level of maturity, new blood can step in and take over the innovation cycle, and once the candidate fits, the business can grow and prosper well into the future. The vote of confidence from Twitter’s board of directors and Agrawal’s expertise and shared vision makes him an ideal figure to take the helm.

What does Dorsey’s Twitter resignation mean for Square?

It means Dorsey has decided to prioritize Square (NYSE: SQ) and its prospects going forward, with the news likely delighting investors. Fintech as an industry is moving rapidly and smaller competitors are joining the movement all the time, so a dedicated decision from its founder illustrates the opportunities ahead.

Square is building the go-to platform for small business e-commerce and giving them the tools to do so; banking, loans, savings and checking accounts (FDIC-insured with interest), and even most recently, a PhotoStudio app to enhance image quality for digital merchants. It also allows the company to work on Jack Dorsey’s bitcoin plans which include incorporating decentralized finance (DeFi) applications and a decentralized exchange (buying and selling) into the Square platform.

Should investors be concerned?

While it’s always great to see a visionary founder taking the lead, it doesn’t mean new management can’t produce outstanding results. The late Jack Welch delivered outstanding returns for shareholders for General Electric when he took the lead, and Lisa Su, CEO of AMD, has achieved similar results in recent years.

Overall, this appears to be the best move for investors of both companies. Shares of the two tech conglomerates have tumbled in 2021, but this decision will clarify responsibilities and strategic planning for both businesses moving forward.

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