Sacco Details Twitter's Travails, Pushes User Growth

Twitter should merge with Google, or, at the very least, become more fun and easier to use, pump up its Periscope service, and spotlight its content around live events and popular topics. 

That’s according to early Twitter investor Chris Sacco, who just published a long prescription for all that ails the micro-blogging leader.

The blog post corresponded with an appearance on CNBC, on Wednesday, in which Sacco said that Twitter would be “an instant fit” with Google, not to mention “a fantastic use of Google’s cash.”

While insisting that he is no “activist investor,” Sacco claims to own “a lot of Twitter stock” -- “more of it than virtually anyone working at the company,” in fact -- and says his goal is to improve the social network’s fortunes.

According to Sacco, Twitter is its own worst enemy. “My biggest concern is the abundance of public doubt and misunderstanding when it comes to Twitter’s vision and the near future for the service,” he writes. “It’s hard to blame Wall Street or the press … Twitter has failed to tell its own story.”

“If the company has a bold vision for the future, it doesn’t come across in their communication with us on the outside,” according to Sacco. Along with a weak vision presented to Wall Street, “new product launches are soft and rarely get the attention from investors or users that Twitter’s peers drum up.”

Short of selling to Google, Sacco says that Twitter needs to reinvigorate new user growth; figure out why nearly a billion users have tried Twitter, then given up on the service; and actually make its direct response ads work for Madison Avenue.

To achieve these goals, Twitter needs to become less confusing, less “scary,” and less lonely for average users. 

“An incremental and iterative approach to improving Twitter will not work,” Sacco insists. “Instead, Twitter will need to take huge risks, deeply question its key assumptions, and launch materially new stuff early and often.”

The critique couldn’t come at a worse time for Twitter, which is still trying to explain its poor first-quarter earnings.

In late April, Costolo blamed the weak quarter on “lower-than-expected contribution from some of our newer direct-response products.” Worse yet, he said the company expected the problems to persist for the remainder of the fiscal year.

Revenue for the first quarter was $436 million, which -- while up 74% year-over-year -- was lower than analysts’ estimates of about $457 million.

Among other unyielding problems, Twitter remains a hotbed for bullying and abusive trolls.

 

Echoing earlier comments by Costolo, Vijaya Gadde, general counsel for Twitter, recently wrote in The Washington Post: “Even when we have recognized that harassment is taking place, our response times have been inexcusably slow and the substance of our responses too meager.”

 

Costolo has faced increasing pressure to relinquish his role as Twitter’s CEO. While key company insiders have reportedly come to his defense, Sacco’s about-face could represent a turning of the tide.

Next story loading loading..