Twit­ter gives co-founder Jack Dorsey a 2nd chance as CEO


Twit­ter is em­brac­ing Jack Dorsey as its CEO in hopes that its once-spurned co-founder can hatch a plan to ex­pand the short mes­sag­ing ser­vice’s au­di­ence and end nearly a decade of fi­nan­cial losses.

The hir­ing re­vealed Mon­day in a reg­u­la­tory fil­ing ends Twit­ter’s three-month search for a new leader. It marks Dorsey’s sec­ond stint as CEO since he helped start the San Fran­cisco com­pany more than nine years ago with Evan Wil­liams, Biz Stone and Noah Glass.

Twit­ter dumped Dorsey his first time around, but its board of di­rec­tors is now con­vinced he has the ma­tu­rity and ex­per­tise to fix the prob­lems that have caused the com­pany’s stock to lose nearly half its value in the past five months.

“As a founder and in­ven­tor of the prod­uct, Jack knows more about Twit­ter than any­one else,” said Peter Cur­rie, the Twit­ter di­rec­tor who led the search for a new CEO.

In­vestors ap­plauded the move as Twit­ter’s stock surged $1.53, or al­most 6 per­cent, to $27.84 in early af­ter­noon trad­ing.

Dorsey, 38, has al­ready had dress re­hearsal for the job, hav­ing be­come Twit­ter’s in­terim CEO in July af­ter for­mer stand-up co­me­dian and vet­eran en­tre­pre­neur Dick Cos­tolo stepped down amid share­holder dis­con­tent. Cos­tolo is re­lin­quish­ing his seat on Twit­ter’s board now that Dorsey is per­ma­nent CEO.

Twit­ter had con­sid­ered its chief rev­enue of­fi­cer, Adam Bain, and sev­eral other CEO can­di­dates be­fore set­tling on Dorsey. Bain, 42, is be­ing pro­moted to chief op­er­at­ing of­fi­cer to han­dle more du­ties as he teams up with Dorsey to try to turn Twit­ter into a prof­itable busi­ness.

“The world needs a Twit­ter that not only re­mains rel­e­vant, but thrives and con­tin­ues to re­de­fine what came be­fore it,” Dorsey told an­a­lysts Mon­day dur­ing a con­fer­ence call. “It is our goal to ex­ceed the ex­pec­ta­tions that the world has for us.”

Dorsey will no longer be Twit­ter’s chair­man, but he will con­tinue as CEO of Square Inc., a com­pany he co-founded in 2009, as he pre­pares that com­pany for its ini­tial public of­fer­ing of stock. Twit­ter plans to re­cruit an out­sider to be­come Twit­ter’s new chair­man, Cur­rie said.

In its hir­ing of Dorsey, Twit­ter’s board re­canted on a pledge is­sued in late June when it vowed to pick a CEO who would be able to make a “full-time com­mit­ment” to the com­pany. Cur­rie said the board changed its mind as it watched Dorsey sur­pass its ex­pec­ta­tions as in­terim CEO and help Twit­ter “find a new gear un­der his lead­er­ship.”

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