What Twitter’s #RIPTwitter Fiasco Can Teach Young Startups

March 28, 2016 - 3 minutes read

Jack Dorsey RIP Twitter startup lessons

If you’re a Twitter user, you’ve probably noticed the #RIPTwitter hashtag floating around your Twitter feed. (Whether that feed appears chronological or dynamic is another discussion.)

For iPhone and Android app developers, watching the once-promising unicorn startup drop in value from an initial high of $45 per share to today’s low of under $20 has been like watching a slow-motion car wreck.

The question is, what can young startups learn from #RIPTwitter and the perfect storm of bad decisions dragging the company from its throne?

1. IPO should be a no-go before monetization is solidified.

Twitter’s first big error was arguably its simplest: going public before the monetization and userbase was entirely solidified. Market Street investors are far less risk-friendly than San Francisco iPhone app developers, and launching Twitter’s stock with an unstable userbase and shaky monetization plan quickly scared off investors once the initial rally slowed down.

2. Strong leadership and stable talent is critical to success.

The notable absence of Twitter CEO Jack Dorsey for much of the company’s growth alongside constant reshuffling of the executive team made it difficult for the social network to pivot and adapt as quickly as competitors like Facebook.

Rather than commit to continual UX changes, Twitter iPhone and Android app developers opted to make minor changes that irritated diehard users without making major changes to welcome mainstream users. In a stock market where image can be as important as value, the lack of clear leadership contributed to lowered valuation compared with companies like Google and Apple that prioritize stable leadership over outside ventures.

3. Growth is everything.

By far the biggest lesson Twitter has to teach young startups and London iPhone app developers is the importance of constant growth. Especially with lofty goals like unicorn status and an IPO, even gradual growth can be considered a liability compared with the steady growth percentages of near-ubiquitous social networks like Facebook. While one in nine people worldwide has a Facebook account, Twitter never reached an audience outside diehard techies and celebrity fan groups.

Mobile app developers seeking high valuation have to be able to demonstrate constant growth — even in a market decline — if they wish to fare better in today’s competitive mobile marketplace.

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