Tech Caucus 1/27: Can Twitter Solve Its Troubles? And Who Are Tech’s Underrated Entrepreneurs?Ben Parr
(The Tech Caucus) – Welcome back to The Tech Caucus, the newsletter where I poll tech’s leading investors, entrepreneurs, and journalists on what’s important in tech.
I want to start this newsletter with a congratulations to my friend Brad Hunstable and the team at Ustream, which was acquired by IBM last week. I’ve been a longtime advisor to Ustream, so I got to watch Brad fight, and fight, and fight to victory (Brad is the most tenacious entrepreneur I know). I also want to congratulate my friends Matt Schlicht and Mazy Kazerooni, who were among Ustream’s first five employees and started their careers there.
Second, I launched a new podcast yesterday, Oversubscribed with Jason L. Baptiste and Ben Parr, with Caucus member Jason Baptiste (founder of Onswipe and Morsel, author of The Ultralight Startup). We talk for 30 minutes on tech and media and quirky things, and sometimes we’ll bring on special guests. We hope you’ll listen!
With that out of the way, here’s this week’s content:
Have questions you want me to ask the Caucus? Email me. Want to chat about this week’s newsletter? Reply to this newsletter.
How Do You Solve a Problem Like Twitter?
Have you heard? Twitter’s in turmoil. This weekend, the social network experienced a mass exodus of top execs. It then hired Amex’s Leslie Berland as CMO. Its share price has taken a complete beating in the last year, dropping from $50+ a share to under $18 a share. Re/code’s Kara Swisher and Kurt Wagner (a Caucus member) have led some excellent reporting on Twitter. If you want a great analysis, read this piece by Wagner on what’s happening at Twitter.
I asked the Caucus two questions about Twitter this week. The first was simple: Can Twitter turn it around? A majority of the Caucus said yes, Twitter can get back on track, but only with major changes:
The Caucus was all over the map when it came to figuring out what’s wrong with Twitter. “It is different things to different people: customer service for some, connecting with celebrities for others, following news for a third,” pointed out one Caucus member. “This makes it hard for Twitter to build a product that serves everyone well. In addition, they have a damaged relationship with developers.”
“The norms don’t get and don’t use it,” noted another member. “It makes it hard to grow. Also their monetization strategy is crunked.” Another Caucus member agreed: “It’s not a product built for mainstream yet. It’s too tied to its roots in the media geeks and Silicon Valley sector.” This member pointed out that Twitter has great content from high-profile people, however, and could possibly find a “radically new” way to use it.
Monetization was brought up several times by the Caucus: “They are not good at advertising yet,” mentioned a member. “It’s very hard to get the returns on Twitter ads that Facebook delivers regularly. This is partially because Twitter’s targeting abilities are much less robust than Facebook and partially because of how Facebook works ads into their feed.”
Twitter also has a trolling problem: “The amount of trolling, abuse, and negativity that spreads quickly throughout the community is something that is also a very negative quality of the platform… It seems like more and more people of importance have left it and don’t feel motivated to do much with it. It’s a reactive engagement tool, not a proactive one. And that’s a monetization nightmare.”
Finally, some said the problem was Twitter’s attempt to go mainstream and “chase” Snapchat and Instagram. “There is nothing wrong with Twitter, the product, save for some unnecessary features introduced in the past year to bring in the masses. The problem is the company’s mentality that it should appeal to everyone. Twitter is niche. Plain and simple.”
Interestingly enough, not a single member of the Caucus cited the fact that Jack Dorsey is the CEO of two companies (Square and Twitter) as a problem. But let’s just say the Caucus had plenty to say about Twitter’s many other problems.
Since Twitter’s freefall, there has been a lot of speculation about Twitter’s future and whether it will get acquired. I personally believe Dorsey would fight most acquisition attempts, but I had to ask the Caucus which company they thought could acquire Twitter and best position it to succeed in the long term. Here are the Caucus members’ responses:
45.8% of the Caucus said Google would be the best acquirer. But the Caucus was not optimistic that Google will swoop in to save the day. “Twitter is terrible at ad targeting and monetization. Facebook blows them away. Google knows how to fix this, but it probably has no interest in Twitter at any price.”
One of the “other” votes was a vote for Google’s YouTube subsidiary to acquire and manage Twitter. The other vote was for News Corp to acquire Twitter. (I personally disagree?—?remember how MySpace did under News Corp?)
A full quarter of the Caucus believes Twitter should remain independent, and 16.7% say Facebook would be a good acquirer. (I have the feeling regulators would never let this happen, though.) Just one member of the Caucus voted for struggling Yahoo to acquire Twitter, though s/he did not leave a reason for his/her vote.
The Caucus’s full feedback on Twitter was fascinating. I may publish all of the responses in a separate post on Medium. Regardless, Dorsey and Twitter have a long, uphill road ahead.
2) Do Startups Create Income Inequality
Thanks to Bernie Sanders, income inequality is a hot political topic in 2016. And why shouldn’t it be? Income inequality is inarguably growing, not just in the U.S. but in China and other countries as well. I could go over the stats, but I assume you know how to Google.
Y Combinator co-founder Paul Graham waded dove head-first into this debate with his essay on income inequality and how startups help create it and why that isn’t necessarily bad. O’Reilly Media founder Tim O’Reilly, who read the piece early, published an email he sent to Paul tell him that, among many things, “you are wrong to think that startups play a significant role in increasing inequality. In general, they are one of the biggest drivers of lesser inequality, because they create more wealth for society as a whole.”
Since we don’t shy away from complex and controversial issues here at The Tech Caucus, I asked the members whether they thought startups increase or decrease income inequality overall. The verdict: they were completely split.
The Caucus’ responses to this question were interesting. Several quietly agreed with Graham. From one member:
“I agree with Paul Graham and think the series of articles/tweets against what he said was a witch hunt. We need to work on new ways to create wealth while allowing those that have lower income to find new ways of opportunity. He wasn’t talking about creating more income inequality, but eliminating bad actors that cause those to without wealth to be hurt more.”
From another Caucus member:
The biggest and best companies in the world are actually building products that empower more and more people to create their own lives. Airbnb, Uber (anyone with a car), WeWork (small businesses who need a place to create), and even companies like Medium (writers and artists) are actually assisting individuals in the pursuit of their own happiness and livelihoods. As these types of startups continue to grow and to spread their reach, more and more people will continue to have more and more means of producing meaningful income and meaningful change in the world around them.
Not everyone took Paul’s side, though. “Concentration of capital into too few hands increases income inequality,” one member states. “Stop pretending we are all perfect, rational creatures with no cognitive biases. If we were an actual meritocracy, our VC & CEO/founder base wouldn’t look like a reversion to the mean of well-off white men.”
Perhaps put more simply by another member: “If you work in tech, you benefit. If you’re a founder, investor, or executive, you benefit even further. If not, you get left behind.”
Some members argued that tech’s impact on income inequality wasn’t clear-cut (which is why there were so many “other” response). “[The tech industry] increases inequality in the short term, but builds products that democratize access,” one member believes.
A lot of members had something to say about access and privilege to this question: “While I think tech gives opportunity to a diverse population for incredible equity growth, unfortunately that opportunity is disproportionately used by those who already have privilege. So while it could be a great equalizer, we need to make sure everyone has equal access.” I personally agree with this quote. To really understand the issue of equal access, you need to read this piece by Crowdbooster founder Ricky Yean now.
There is no consensus among tech’s leaders on this issue. But it may not matter in a few years?—?one member pointed out that automation (self-driving cars, automated servers, and more) could radically change the world economy in ways we cannot even yet predict. This will be a topic of a future Tech Caucus newsletter.
3) Who are Tech’s Underrated Entrepreneurs?
Some people do great work but don’t get recognized for it. That’s why I polled the Caucus on their favorite underrated or unknown entrepreneurs. I received several names I recognized and a bunch of people I had never heard of until I looked them up for this week’s newsletter. These entrepreneurs are founders and top execs; men and women; rising stars and success stories.
Before you ask?—?I don’t know which Caucus members nominated which entrepreneurs for this list. I don’t have that information on purpose. This is all anonymous, remember?
So, without further ado, here’s the list of the Tech Caucus’ favorite underrated and unknown entrepreneurs:
4) Which Tech Leader Should Run for President?
The last question of every Caucus newsletter is always a fun one. This week, I asked the Caucus about the election. Specifically: if they could choose any tech leader to run for President of the United States, who would they want?
(To our non-U.S. readers?—?I promise more international questions next week! Just sit tight!)
Only two “candidates” received multiple votes: Bloomberg founder and former New York City mayor Mike Bloomberg (who is rumored to be mulling a run) and Facebook COO Sheryl Sandberg (a former chief of staff for the Treasury Department under President Clinton). I’ve heard Sheryl rumors for years?—?I can see her running for Senate someday. “She is one of the most empathetic people on the planet and understands how to get groups to make decisions to move things forward better than anyone,” one member of the Caucus gushes.
As for Bloomberg, here’s what one Caucus member had to say: “He’s a proven leader in technology, business, and politics. He has NYC values: ambitious, pragmatic and socially liberal.” Could Bloomberg trump Trump with his billions?
Other tech leaders who were named by the Caucus: Mark Zuckerberg, Elon Musk, Tim Cook, Mark Cuban, Steve Case, and Startup L. Jackson (hah! Come back to us, please.) Two Caucus members expressed the sentiment that they didn’t want tech leaders running the United States: “Egomaniacs… at least the most successful ones,” one member says.
Subscribers, which tech leader do you think would make a good President? Shoot me a reply and I’ll feature my favorite responses.
Interesting Links of the Week:
Commentary from the Peanut Gallery:
A lot of you had great things to say about last week’s newsletter (with many more pitching me their clients as members of the Caucus), but this comment on the gentrification section of last week’s Tech Caucus caught my eye:
I thought there were several answers from the Caucus that didn’t involve the government, but Luca makes a good point that the tech industry has helped create the gentrification problem, and it needs to be active in being part of the solution.
(Did you know I post all the newsletters on Medium as well?)
This week’s Tech Caucus is sponsored by the #NoPants movement. Pants are restrictive, cumbersome and totally unnecessary. Join the #NoPants movement and free yourself from the burden of jeans and slacks today!
Have a question you want me to ask the Tech Caucus? Have a suggestion for a new member of the Tech Caucus or an Interesting Link of the Week? Reply to this email or email me directly.
The Tech Caucus: Mark Achler, Jason L. Baptiste, Megan Berry, Niko Bonatsos, Sarah Buhr, Vanessa Camones, Tracy Chou, Julie Crabill, Paige Craig, Don Dodge, Adam Draper, Josh Elman, Julie Fredrickson, Troy Henikoff, Daire Hickey, Ryan Hoover, David Hornik, Charles Hudson, Leila Janah, Olivia June, Richard Kerby, Aileen Lee, Loic Le Meur, Doug MacMillian, Jessica Mah, Jesse Middleton, Miyuki Matsumoto, Danielle Morrill, Nathaniel McNamara, Nathalie Nuta, Jeremiah Owyang, Chris Saad, Raju Sagiraju, Juan Scarlett, Matt Schlicht, Robert Scoble, Marcy Simon, Jon Swartz, Jana Trantow, Jennifer Van Grove, Kurt Wagner, Robin Wauters, Mike Weiksner, Brian Wong, Michelle Zatlyn.