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Do Social Platform Founders Limit the Evolution of their Companies?

do social platform founders limit the evolution of their companies

Last week, The Information published a report which suggested that Snapchat CEO Evan Spiegel was almost solely responsible for the launch of the app’s recent redesign, which has proven hugely unpopular with users.

As summarized by Engadget:

“…the design was released despite reservations from Snapchat engineers and a mediocre performance during pre-launch tests. After CEO Evan Spiegel decided he wanted to completely revamp the app's design, he gave the company's engineers a short timeframe in which to complete it, and some current and former employees have said that the overall goal - to make the app easier to use, Spiegel said later - wasn't adequately conveyed to those working on bringing the new design to life.”

Indeed, another element of The Information’s report suggests that Spiegel announced the coming changes on Snap’s November earnings call, catching many Snapchat employees by surprise, as they had no idea any such announcement was planned.

As we now know, the redesign has not been well-received, forcing a re-think of the whole process, and a return of some of the functions which had been removed by the change.

In itself, this report’s not surprising – Spiegel has long been known to have the final, and sometimes only, say over what happens with the app. But it does raise another question that seems to be being overlooked.

Are social media platform founders best-placed to make decisions on the future of said apps?

The Case of Facebook

In many ways, the social media industry has been logically templated against the rise of Facebook. Facebook, under the leadership of its founder Mark Zuckerberg, has gone from strength to strength since starting as a basic college comparison app, and is now a the largest social company in the world, by far. Zuckerberg, too, has been able to adapt to the platform’s shifts, which has inadvertently made him the expectation for what a social platform CEO needs to be.

But both comparisons - to Facebook’s growth and Zuckerberg’s performance - are largely unfair.

In the first case, as we’ve seen with Twitter, comparing other platforms to the rapid expansion of Facebook is not realistic, and can be damaging to their market standing. When Twitter’s growth rates started to tail off, the company was inevitably seen as failing by comparison to Zuckerberg’s ever-expanding empire, and that’s forced Twitter to continuously justify its position. But Twitter does have 336 million monthly active users, and it is now running at a profit. In most other sectors, Twitter would be seen as a success, but the head-to-head with Facebook will never work in the company’s favor.

Snapchat, too, is now feeling the same pain, with the app’s slowing growth spooking many market watchers. And of course, that makes sense, fewer users means less revenue potential - but similar to Twitter, Snapchat does have 191 million users logging in daily, they did generate $231 million in revenue last quarter alone.

Absolutely, there’s justified concern on both fronts, market analysts know where to look. But all social platforms not owned by Facebook will also inevitably suffer from being match-up against The Social Network.

Which brings us back to the same comparison, but in platform leadership.

Founding Fathers

All of the founders of the major social platforms have become massively rich off the back of their success. But in addition to money, these founders have also benefited from a boost in perception – people like Zuckerberg, Spiegel, Jack Dorsey and Ev Williams, all of these people are allocated genius status, and are seen as brilliant minds, often beyond critique.

But what if some of them were just in the right place at the right time? What if some of them, dare I say it, just got lucky?

In the case of Spiegel, that may be unfair – Snapchat’s success thus far can largely be attributed to his vision, and the app, thus far, has done amazingly well. Spiegel has been praised by many for his visionary capacity, for his ability to tap into the mood of the moment and connect with audiences, and it’s hard to fault him based on this one significant, yet mostly isolated, slip-up (we’ll have to wait a little longer to see if Spectacles falls into the same category).

But what about other founders?

Twitter, despite cementing its place in our interactive landscape, hasn’t really done much innovating since its inception. The company was founded by Jack Dorsey, Biz Stone, Evan Williams and Noah Glass.

Dorsey’s remained at Twitter, taking over as CEO in 2015, and he hasn’t added a heap of evolutionary kick. Stone founded Jelly, an ill-conceived question and answer social network which he later sold to Pinterest, before returning to Twitter to fill a ‘Biz shaped hole’ in the business. Williams went on to launch Medium, which, despite its success as a platform, has struggled to monetize and build the app into a business. Glass has largely stayed out of the public eye since being ousted from Twitter.

While each of them has achieved a lot through Twitter, the question needs to be asked whether they’re actually the genius level leaders we hold them up as, and whether they have the capacity to answer the questions being put to them as such.

Is Dorsey best-placed to lead Twitter? It’s only fair to also note that Dorsey’s also the CEO of Square, which is seeing some level of success, but it’s difficult to understand the level of hands-on involvement Dorsey actually has in either business.

Is having Dorsey and Stone on board beneficial to Twitter’s future? Do their roles in the history and development of the original platform mean anything, now that it’s evolved well-beyond that – and needs to grow even more?

Twitter did, of course, try an outside CEO in Dick Costolo, who lead the company for six years till stepping down in 2015. Within that time, the company launched its IPO, a process which Costolo is seen as being instrumental in. But while Facebook has developed and expanded, Twitter has largely stagnated, with the major changes rolled out not, by comparison, really that major at all.

Could the company have benefited from alternate leadership?

The other example to consider here is LinkedIn – the platform was founded by a group of people, lead by Reid Hoffman back in 2002, but its Jeff Weiner, the company’s current CEO, who’s advanced the platform beyond its initial roots since being appointed to the role in 2009. You could argue that LinkedIn hasn’t exactly innovated a lot either, but still, the outside vision of Weiner has changed the trajectory of the company.

In 2017, LinkedIn generated $2.3 billion in revenue. Twitter, with a lot more active users (LinkedIn reportedly has between 125m and 250m MAU vs Twitter’s aforementioned 336m) generated $2.44 billion.

By audience comparison and market presence, you’d expect Twitter to be winning out.

And then, of course, there’s Evan Spiegel at Snap Inc. Could Spiegel be at the limit of his capacity in leading that company to the next level? Do they need new, externally developed leadership?

The Benefit of Hindsight

The observations noted here are not intended to be seen as a criticism of any of these individuals, nor is anyone outside of these companies able to put together a nuanced, comprehensive understanding of their inner-workings, because we simply can’t see it. But it is worth raising the question over whether the founders of the social platforms that have grown to become such dominant spaces are best placed to take them to the next stage.

Some clearly are – as noted, Mark Zuckerberg has adapted his leadership to take into account the business aspects, and has put the right people into management positions to help take it to that next level (along with various strategic acquisitions). We’re about to see this again with WhatsApp, with former CEO Jan Koum recently stepping down due to conflicts with Facebook leadership over what’s best for the future of the app.

Will that lead to WhatsApp becoming a more lucrative business tool, bringing in even more revenue for Facebook? It likely will, but that may also mean compromising what the app has always been about, hence Koum’s disapproval.

But does that matter? Does the business imperative of a social app benefit from holding to its initial ideals once it reaches a certain size?

This is a key question to ask – are social platforms being helped or hindered by the involvement of their founders? And is there a point where those original creators, and their ideals, need to step aside to enable the next stage?

 

Article and image(s) via Social Media Today

 

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