Jack Dorsey, the co-founder of Twitter, stepped down as chief executive on Monday, as the social network appointed Parag Agrawal as his successor.
“I’ve decided to leave Twitter because I believe the company is ready to move on from its founders,” Dorsey said. “My trust in Parag as Twitter’s CEO is deep. I’m deeply grateful for his skill, heart and soul. It’s his time to lead.”
Dorsey’s decision to stand down came nearly two years after Dorsey reached a truce with activist investor Elliott Management, which had tried to remove him, saying he was distracted by running Square, the payments company, and by his other interests.
Twitter’s board said Agrawal, who has been the company’s chief technology officer since 2017, would be its new chief executive, effective immediately. Bret Taylor will become the new chair of the board.
“Jack returned to Twitter and turned the company around at the most critical time,” Taylor said. “Jack has given the world something invaluable and we will continue to carry it forward.”
Shares in the company jumped 10 per cent in pre-market trading, which was halted shortly after the news broke on CNBC.
Elliott Management, which has a 4 per cent stake in Twitter, previously expressed concerns not only about Dorsey’s role at Square but also about his leadership style and plans to spend at least half his year in Africa exploring opportunities in cryptocurrencies, a trip that was later cancelled.
“I have enough flexibility in my schedule to focus on the most important things and I have a good sense of what is critical in both companies,” Dorsey told the Morgan Stanley conference in San Francisco in March.
It was eventually agreed by a committee of stakeholders that Dorsey could stay in place if he met challenging performance targets.
Dorsey co-founded Twitter in 2006 and served as chief executive until 2008, when prominent board member Fred Wilson declared him unfit to lead the company.
The board reportedly cited Dorsey’s habits of leaving early to attend yoga classes as one of the reasons for the move. Dorsey stayed on as chair but returned to Twitter as chief executive in 2015, after his predecessor Dick Costolo resigned.
For Dorsey, his return to Twitter was akin to Steve Jobs’ return at Apple in 1997, with the added mission of having to turn round a company that lacked a clear vision on how to deal with in an increasingly competitive social media world.
One large shareholder said Dorsey had an engaged presence internally with a trusted layer of lieutenants. He added that Dorsey was able to make big strategic changes such as removing sacred cows including Twitter’s chronological feed and its 140-character limit for tweets. But as his wealth in Square soared and he considered a move to Africa, his engagement waned.
Twitter’s advertising revenues grew 14 per cent last year to $2.99bn, a slowdown from the 24 per cent growth of the previous year. Dorsey owns a 13 per cent stake in Square, compared with his 2 per cent stake in Twitter.