As he walked onstage at the Bitcoin 2021 conference in Miami, Jack Dorsey was still technically the chief executive officer of two publicly traded companies, but he looked more like a beachside bartender.
As he walked onstage at the Bitcoin 2021 conference in Miami, Jack Dorsey was still technically the chief executive officer of two publicly traded companies, but he looked more like a beachside bartender. He wore a sunburst tie-dye shirt, with his head shaved and his long, graying beard untrimmed. He’d flown to South Florida, even though the official policy at one of his companies, Twitter, was that employees weren’t supposed to travel for work, and even though a group of activist investors had spent the better part of the previous 18 months trying to oust him for being unfocused.
No matter: Dorsey had resolved to enjoy himself in the most Jack Dorsey way possible. He went to the beach with a twentysomething model, Flora Carter, had dinner with Dave Portnoy, the professionally obnoxious sports media entrepreneur and stock trading enthusiast, and hung out with Floyd Mayweather, the professionally obnoxious boxer-turned-crypto-promoter. (Mayweather was in town on behalf of EthereumMax, a new cryptocurrency, and for an exhibition fight against bro influencer Logan Paul.) Onstage, Dorsey was heckled by Laura Loomer, the far-right conspiracy theorist who’d famously handcuffed herself to the doors of Twitter’s New York office after her account on the social media service was banned in 2018. Dorsey had called her protest “brave,” and now, when Loomer jeered that Dorsey was the “king of censorship,” he replied earnestly. He said he hoped to remove the “corporate-ness” from Twitter, making it more open and decentralized, like Bitcoin.
Dorsey had lots to say about Bitcoin—in fact, a lot more than he had to say about either Twitter or Square, his payments company. He predicted Bitcoin would replace banks, bring economic opportunity to entrepreneurs in the developing world, and incentivize investments in renewable energy. “Bitcoin changes absolutely everything,” Dorsey stated matter-of-factly. “I don’t think there’s anything more important in my lifetime to work on.”
Five months later, Dorsey resigned from Twitter Inc. and announced that he was renaming Square. Henceforth the company, which helps local coffee shops and other small businesses process payments, would be called Block Inc., which brings to mind the main technology underlying cryptocurrencies: blockchain. Officially, Block is Dorsey’s full-time job, but almost everybody in his orbit knows he has a pretty serious side hustle. While he was running both Twitter and Square, his employees often joked that Twitter was his “favorite child.” Now it appears—based on conversations with more than 30 current and former employees who’ve worked for him—the favorite child isn’t so much Block; it’s Bitcoin.
For someone with a lot of power, Dorsey has been oddly averse to wielding it. Those who have worked under him at Twitter and Block say he doesn’t like making decisions and considers it a failure of leadership if he must. It’s not uncommon for Dorsey to go an entire meeting without saying more than a few words, and he prefers to leave employees with thought-provoking questions or abstractions instead of concrete directives.
His feelings about authority have even started to color his own views of Twitter. Dorsey recently wrote that having companies control online content and user identity was a mistake. “I realize I’m partially to blame, and regret it,” he tweeted. It’s a view shared by Musk, who was supposedly so bothered by Twitter’s speech rules he suggested building a new service while simultaneously buying up billions of dollars in the company’s stock. (Dorsey’s aversion to corporate control also partly explains his love for Bitcoin, which is unregulated and isn’t controlled by any company.)
But having a chief executive who’s ambivalent about being chief and not crazy about executing comes with serious trade-offs. The people who work for Dorsey often feel empowered to make decisions, but his indecisiveness can also be a source of frustration, at times creating a state of internal paralysis. “If you like directions,” says one former Block employee, “you will struggle with Jack.”
Dorsey’s aversion to making decisions was why, for instance, Twitter spent years working on minuscule product tweaks, such as increasing the maximum tweet length to 280 characters. It also caused Square to miss out on opportunities, including the chance to buy Plaid Inc., a software company that lets people access their bank accounts and transfer money inside other apps. Square had been in talks to acquire Plaid for a bit less than $1 billion in 2018, and the majority of Dorsey’s senior management team favored the deal, according to two people familiar with the discussions. But Dorsey refused to make a final decision. Instead he said the team should reach a consensus one way or another. The group couldn’t, and the deal fell through. Plaid is now worth more than $13 billion.
He shines, though, in understanding and predicting the future. Dorsey can become fixated on specific trends or products years before others see them coming, his employees say, and while that might mean he ignores or disengages with more immediate issues, he’s often right. Eventually. “He’s not a product manager,” says one former Twitter employee. “He’s a product inventor.”
Dorsey came up with the ideas for both Twitter and Square, and he also created Cash App, Square’s consumer payments service akin to Venmo or PayPal. In the app’s early years, it was a major money-loser. This was still true as Square was heading for an initial public offering in 2015, when conventional wisdom suggested the company should focus on its profitable payment-processing product. But Dorsey pushed aggressively to keep Cash App alive. It now has 44 million monthly users and accounted for roughly half of the company’s profits in 2021. It’s also become an increasingly popular way for people to buy and sell Bitcoin. Customers made $10 billion worth of Bitcoin transactions through Cash App last year alone.
Dorsey was one of the earliest investors in Instagram, recognizing the app’s potential before most people even knew what a photo filter was, and he pushed aggressively for Twitter to acquire the nascent short-video app Vine in 2012 before it ever started. Even though Vine ultimately failed, a similar app—TikTok—eventually grew to become one of the most popular in the world.
Remote work was also an early Dorsey fixation. By the time the pandemic forced office workers the world over to telecommute from their living rooms, Dorsey was already moving both Twitter and Square toward the concept because he’d argued that his companies would miss out on top talent otherwise. Pre-Covid, Dorsey was already working from home a few days a week. In fact, part of his rationale for going to Africa for half of 2020 was to prove that long-term remote work was possible.
Dorsey’s admirers see his Bitcoin obsession in a similar light. “I would always pay attention to anything Jack foreshadows for the future,” says Jackie Reses, who led Square’s banking and loans business and who’s now working on her own fintech startup. “He’s more often right than wrong.” Dorsey, in fact, has been interested in cryptography since his teenage years, when he’d use an internet connection at Washington University, near his childhood home in St. Louis, and log on to Usenet chat groups, including one called alt.cypherpunks. He read the Bitcoin white paper shortly after it was released in 2008 by its pseudonymous author, Satoshi Nakamoto. “The whole thing was just poetry,” he recalled years later. The community that sprung up around Bitcoin reminded him of the internet chat rooms he’d spent time in as a kid, and Dorsey didn’t just see Bitcoin as a currency or a way to store value. He saw it as a full rethinking of the financial system that could potentially replace banks and other intermediaries. As he put it at the B Word conference in July 2021, “You see a chance to replace the whole foundation.”
After Elliott’s initial attack on Dorsey in early 2020, Twitter had a pretty good year. The U.S. election and the pandemic created an enormous appetite for news, which meant the company’s user base grew faster than it had in years. The day before the U.S. election in November 2020, Twitter issued a filing that said the board had reviewed the company’s management structure and “expressed its confidence in management.” This was code for “Jack can keep his job.”
The stock price reached an all-time high in late February 2021, but two months later Twitter reported poor quarterly earnings, the beginning of an up-and-down year. When Dorsey resigned in late November, he tried to explain his departure in a letter to employees by arguing that being “founder-led” could be “severely limiting and a singular point of failure” for companies. A key reason he was leaving, he added, was that he wanted Twitter to “break away from its founding and founders.” It was an unconvincing explanation considering Dorsey was still running Square full time.
Those who know Dorsey say he was simply worn down by the constant pressure from Elliott, aware that a bad quarter could lead to another assault on his job. Twitter had dabbled a bit with blockchain technology, funding an effort to build a decentralized version of social media and letting users tip one another with Bitcoin. But Dorsey’s obsession with the cryptocurrency ultimately fit much better with Square. His resignation meant that Elliott got the full-time CEO it wanted for Twitter: Parag Agrawal, promoted from chief technology officer. Dorsey got to go work on crypto.
The newly renamed Block has incorporated Bitcoin into almost every one of its business units. Its internal TBD division (that’s not a placeholder—it’s the actual name) is building a technology to turn dollars into Bitcoin. There’s a separate effort, Spiral, that’s building and funding projects with the goal to “improve and promote” Bitcoin. Block is working on Bitcoin mining chips and creating its own hardware wallet so people can safely store their Bitcoin offline. And the company is involved in a venture to build a Bitcoin mine in Texas using solar panels provided by Musk’s company Tesla Inc.
In early 2021, Dorsey agreed to pay $300 million for Tidal, the music streaming service owned by Jay-Z, and later that year spent $29 billion for Afterpay Ltd., a buy-now, pay-later business in Australia. Square was even approved for a banking license in 2020 to offer small-business loans directly to customers.
The blueprint for Block’s constellation of vaguely related services, according to former employees, is Walt Disney Co., where Dorsey sat on the board from 2013 until 2018. In discussions with investors before its 2015 IPO, Block executives referred to a diagram showing Disney’s offerings including theatrical films, merchandising, and theme parks. The idea was that, just as each business line within Disney contributed to the organization’s other divisions, so would Block’s products and services reinforce one another. Today, consumers can make payments through Cash App, and businesses can accept those payments using the original Square service, while taking out a loan from Block’s banking operation.
Dorsey’s allies say this strategy was behind the Tidal purchase. Tidal had been struggling when Square bought it, leading critics to suggest Dorsey was simply paying a premium to hang out with a famous rapper. The two were seen cruising around the Hamptons on a yacht in August 2020, and Jay-Z got a seat on Block’s board of directors as part of the deal. But Dorsey has argued for a business rationale in which Block will create better ways for musicians to get paid, much like Square did for coffee shops and farmers market vendors in its early days.
Gladstein is one of the many Bitcoin enthusiasts who find Dorsey’s conviction inspiring. “I’m definitely grateful that he’s out there doing his thing,” he says. “I think he’ll be remembered probably more for Bitcoin than for Twitter, in the end.”
Source : Ndtv.com