While Twitter’s stock stumbles, ex-CEO announces next moves
January 22, 2016
When Dick Costolo announced last June that he would be stepping down as CEO of Twitter (NYSE: TWTR) and handing the reins over to co-founder Jack Dorsey, there was a mixed reaction, and many questions swirled. Some thought that Dorsey was a good fit for the struggling company as he could bring a passion and eye that only a startup’s founders have. Others worried that having him at the helm of two companies (Dorsey was also serving as CEO of payment processing company Square (NYSE: SQ)) was a recipe for disaster. There was also the question of what Costolo would be doing after stepping down from a position that he had held since 2010.
This week has shed light on some of the questions posed last year. Costolo revealed on Tuesday that he is starting a new fitness-oriented software startup with Bryan Oki, a previous co-founder and CEO of fitness consulting firm Fitify. Along with the new enterprise, Costolo has joined Index Ventures as a venture partner, investing in entrepreneurs and working with portfolio companies to help them scale and grow. Although he is best known for his time as the head of Twitter, Costolo brings more experience to the table. Prior to joining Twitter, Costolo was the CEO of FeedBurner, a web feed management service that was acquired by Google in 2007. He holds over 17 years of experience in various leadership roles at startups.
As for Twitter, the jury is still out on how the company will do long-term with a shared CEO. That said, the stock did take a fall this week, dropping 8% on Tuesday from $18.18 to $16.69. The reason for the downward trend that Twitter’s stock has seen as of late could be attributed to a host of factors, but this sudden downturn seems to have been sparked by a platform outage on Tuesday morning. And although the market as a whole has seen better days, it’s difficult to ignore that both Dorsey-led companies, Twitter and Square, have stock that is underperforming. Square saw an 8.3% drop in stock price from $10.33 to $9.47 on the same day.