Such was the situation Friday when Twitter received $35 million in additional funding from International Venture Partners and Benchmark. The company said that it hadn't been looking for the money, but the offer was just too good to pass up.
FYI, Twitter has never made a dime. It has attracted legions of consumers for its free service, but then again, so has the atmosphere; like breathing, there's no reasonable expectation that doing so is monetizable.
There's just hope, and trust, in the myth of the boy-genius technology entrepreneur: the founders promise to emerge in short-order, and reveal to the Universe their brilliant plans, which will defy history, economics, and sundry laws of causality.
It's funny. We demand that GM's leadership spell out its plans to sell cars in excruciatingly painful and humiliating detail, and only then grudgingly give it a dime. But the technology wiz-kid fantasy du jour? There's somebody willing to hand them $35 million, which should have been even harder to get than public largesse. GM is going to embarrass everyone, but Twitter will make its investors proud. They just know it.
Whether admitted or not, lots of private capital investing is based onBlack Swan theory, which is just shy of outright gambling. Money isn't spent because of the certitude of a company striking gold; it's invested on the bet that a business idea will defy the very conventions that make it such a risk, and on how surprising, and surprisingly huge, such breakthroughs usually are.
Twitter isn't getting money because it's a sure bet, but rather because it's such a long-shot.
So I want to invest my two cents to help it succeed: here is my Three Point Plan to help it defy those odds, confound the critics, and become a recurring game-changer:
- Step out of the conference room. Let's face it, the smarty-pants technoentrepeneur myth is just a myth: just because one college-aged guy chanced on something that caught on doesn't make him smarter than the thousands of similarly-talented innovators whose ideas were either too early, too late, or just didn't quite fit like his did. So when you or any other wiz-kids retreat into your echo chamber bubbles, it satisfies and reinforces your sense of self-aggrandized worth, but it doesn't bode well for future breakthroughs. It's just the wrong set-up (see Bill Gates). The first step in finding that next breakthrough is to step out of the conference room (or private jet) and try to replicate the circumstances from which breakthroughs emerge. I have no idea what those criteria were when you dreamt up Twitter, but I bet they included being in touch with lots of other, real people, and understanding (perhaps intuitively) what they like and want to do. Not via focus groups, or from those other brilliant investor-types who populate your board. For real.
- Give up the next innovation to your users. So forget plotting the money-making ideas that you'll dump on them, and let them co-invent the next steps. Treat the community like a real community, and build the development conversation into the fabric of tweets, putting a simple question to users: We need to monetize this service, so what would that mean to you? By definition, all of the ideas from digital agencies intended to exploit said users would be rejected, as would probably most other actions that would overly-crapify the interface (see MySpace for details). It might also create a sense of ownership and involvement heretofore unimagined by the experts at Twitter World HQ. Think less corporate genius, and more public radio.
- You need to create a platform for constant change, not ideas to make money. Whatever gets invented over the next 12 months at Twitter, there'll be all those other brilliant wiz-kids busy working to invent better stuff. Competition is constant, and the siren call of other fads -- especially free ones -- will constantly lure folks away from your platform. So once you get users co-inventing and managing their Twitter experience, you have to create ways to institutionalize that innovation. Less consumers, and more citizens. Could Twitter users vote on new ideas? Are there milestones for introducing radical new services and tools, so everyone knows that everything will change so-and-so often? If Twitter isn't fundamentally different a year from now, it'll be distant history. And adding ads and other garbage doesn't count.
I doubt we'll see any of this from Twitter, of course, and we'll get far too detailed -- and unreliable -- plans from GM and Chrysler later today. All of these companies are beholden to outdated processes and expectations, even if some of them are in businesses that look and feel really futuristic.
Even Twitter needs a recovery plan to get past the Conventional Wisdom.
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