In this success story, we will share the biography of Jack Dorsey, an American businessman and web developer known as a co-founder and co-creator of Twitter and the founder and CEO of Block (formerly Square), a mobile payments company. Sometimes, even the most unexpected ideas can turn into a great business. For example, a product with the catchy name Twitter arose from the desire of a young programmer, Jack Dorsey, to be constantly aware of what’s going on with his friends. He pioneered microblogging services; now, we can see how it moves the world.
Jack Dorsey was born in St. Louis, Missouri, USA on November 19, 1976. As a teenager, he loved computers and could spend hours studying one of the first versions of IBM. He wanted to draw a live map of New York City, displaying numerous small moving dots in real-time: ambulance cars, police crews, fire brigades, taxi cabs, etc. The constant travel of his father can easily explain Jack’s passion for the cities and towns: Tim Dorsey, a medical equipment engineer who received many offers across America. The Dorsey family has managed to change a few houses in its native St. Louis and settle briefly in Denver, CO. Whenever they moved to a new city, Jack bought a local map and walked around the new places until late. His mother, Marcia Dorsey, thinks it is a form of protection from new people.
The first thing they people remember about Jack is what a quiet boy he was! There’s an explanation for this fact. He was stuttering and, thus, preferred to remain silent. Young Dorsey solved this problem by himself after giving up on the medicine. The boy purposely participated in various oratory competitions, and after several failed attempts, he could speak normally. Later, this “conquering” way to solve problems helped him survive in difficult conditions in New York and San Francisco.
According to the sources from Jack’s native school, Bishop du Bourg High School in St. Louis, Missouri (several generations of Dorsey’s went there), he was an ordinary American disciple: played on the tennis team, loved drawing and Art history, worked for the school newspaper and, of course, was a member of a computer club. The last one was his favorite but not an obsession as it did for Bill Gates or any other aspiring programmer. However, Jack undoubtedly has a talent.
According to Jack Dorsey, he could have become a great expert in urban planning, but his childhood passion for city maps took over. At first, he tried to transfer road atlases into digital format and then put moving objects on his map using an electronic bulletin board (the Bulletin Board System is a prototype of the Internet). The result was a kind of an actual city but in a miniature. Jack’s first programming experience occurred when he was 14 years old. The boy wrote a few programs for taxi dispatching and firefighting services. Some people say that the idea of Twitter came to him just in one of those moments when he heard the drivers talking with each other about where they were and what they were doing. According to another source, the roots of this idea come from Jack’s earlier passion.
“I thought a job of a courier must be a kind of magic”. – Jack Dorsey says. – “I liked to keep tracking of the physical path of a courier from one point to another or even around the world. Someone takes a package, puts it in a bag, walks somewhere and then hands it to someone else.”
Intern, Masseur, Programmer
In the summer of 1991, Jack joined Mira Digital Publishing Company. The boy showed up in his boss’s office, Jim Makkilvi, when he was in the middle of a significant project. Jim promised to talk to Dorsey in a minute but, as it often happens, immediately forgot about it and went back to work. After several hours, the young talent stood at the same spot and waited patiently. A few weeks later, a teenaged Jack Dorsey led a team of programmers in their thirties. Employees once asked the chief how Jack’s position was called. Makkilvi gave them a sharp answer: “He’s an assistant of the summer intern.”
After leaving the native ground of St. Louis, Jack Dorsey entered the Missouri University of Science and Technology. Still, two years later, he moved to New York City – a city he had dreamed of since childhood. His passion for urbanity was becoming something bigger than just simple entertainment. Now, Jack wanted to get his moving dots on the map to communicate with each other and tell where they were and what they were about to do. “What’s happening?” – is the core question that users answer on Twitter today.
Dispatch Management Services Corp was the next company Dorsey got into. From Jack Dorsey’s biography, we learned that he hacked the security system of the company’s website and emailed DMSC’s top manager, Greg Kidd, with recommendations on how to patch the hole created by Dorsey. Despite the potential threat of being arrested, Jack was hired by the company. There, he learned about a short messaging system (SMS) and a new program through which dispatchers could view the movements of couriers in real time.
For several years, Dorsey has worked on creating software for taxi and ambulance cars and played a crucial role in promoting the new project Greg Kidd called dNet.com. However, the project failed after the dot-com bubble in 2000, and Dorsey was left unemployed. He has freelanced for almost five years and even attended massage therapy courses.
Later, Dorsey was hired by Odeo Company, which specialized in Internet startups. It was located in Silicon Valley (San Francisco) and was headed by the talented programmer and businessman Evan Williams, who previously worked with Sergey Brin at Google. In 2006, Odeo began to experience a financial crisis and, most importantly, ideological difficulties. Evan suggested his team divide into a few groups and develop several new products. Then, one day, sitting on the playground and eating Mexican fast food, Jack Dorsey told the world about a service that allows users to share their minds online. This is how SMS service was introduced to the U.S. market. It is interesting to know that while European teenagers have been texting each other for a long time, the United States, a country of high technology, only made the first step in exploring this simple service.
Jack proposed to use SMS to send messages through a unique program that would then spread them around the friend list (hence, the limitation in the number of allowed characters is 140). It took Dorsey and his friend two weeks to write a code and develop a name, Twitter, and the blue bird logo.
Jack Dorsey had different brilliant ideas in his teenage years, which he carefully noted in his notepad. For the embodiment of all the ideas, young Jack had neither funds nor spare time. Over time, this notepad was hidden in one of the many boxes in a closet.
The world would not have seen Twitter today if Jack had not done a general cleaning one day, during which he found the notepad with many ideas listed there.
After looking through the notepad, imbued with memories, and realizing that nothing has been done in this life, Jack decided to learn his youthful plans.
Jack wanted to share his insight with his old friends and realized they were far away, but it would be great if they could read his thoughts. This is how the idea of creating Twitter appeared, which Jack and his friend created in two weeks.
The First Tweet
The first entry in the microblogging service Twitter appeared on March 21, 2006. Jack Dorsey wrote in his account: “just setting up my twttr.” The first public version of the service appeared in June 2006.
In the beginning, Americans said that Twitter was nonsense. Even Evan Williams once compared the project with an ice cream, saying that it’s also both tasty and equally useless.
It was a great surprise when Odeo, supporting the initiative of young programmers, ran out of money. In less than a month after Twitter’s launch, Jack had to think about how to raise more funds and survive as a separate company. “We did not have enough time to digest what happened when suddenly we received a note with an invitation for breakfast.” – Dorsey recalls – “We met with its author in a hotel in San Francisco. There has been a fairly short but productive conversation. When we returned to the office in 30 minutes, we found a scanned image of a half-a-million-dollar check in our inbox.”
It was Fred Wilson who offered himself not only as an investment but also as a strategic consultant for Twitter. Despite the strict schedule, he always found enough time for advice. Moreover, his strategy focused on the global picture and the minor details of Twitter usage. The new investor came to work with various questions and requests, which helped him understand the team’s ideas and thoughts. As a result, Fred has supported Twitter financially and contributed to its successful management.
However, with the development of smartphones, sending messages via the Internet has become easier than SMS. According to the SimilarWeb analytics tool, Twitter has 2.2 billion visits monthly.
The widespread popularity of the novelty began after the South by Southwest Film Festival in 2007, where the company’s employees installed multiple screens, displaying real-time messages from the service users. By this step, the creators of Twitter managed to increase the number of daily tweets from twenty to sixty thousand. Just a year later, in May 2008, the billionth message was sent through Twitter. The company began to develop, resulting in its market capitalization reaching $1.5 billion.
An opportunity to exchange short messages simultaneously with millions of people around the globe turned Twitter into a dangerous political weapon. For instance, with this service’s help in Iran, people gathered in a vast protesting crowd in just a few days. Something similar happened in Moldova, Guatemala, and Uganda. The U.S. State Department even invited Jack Dorsey to Iraq to teach the local Prime Minister how to tweet. By the way, a former security adviser of the U.S., Mark Pfayfel, even took the initiative to nominate Dorsey and other creators of Twitter for the Nobel Peace Prize for their impact on Iran’s future.
Thinking of multiplying his wealth, Evan Williams persuaded the Twitter board to remove Jack Dorsey from his position. In October 2008, Dorsey was removed from his post as the executive director of Twitter and stopped his active work in the company.
In 2010, Evan Williams could not handle it anymore and left the post, passing it to another top manager of Twitter Inc. – Dick Costolo, who later decided to return Dorsey to Executive Chairman. In March 2011, Jack Dorsey initiated the dismissal of four managers who played a crucial role in implementing the service strategy under the leadership of co-founders Evan Williams and Biz Stone.
On June 10, 2015, Dick Costolo announced resigning as Twitter’s CEO effective July 01, 2015. Jack Dorsey took the position of Interim CEO. On October 05, 2015, Jack Dorsey was assigned as the permanent CEO of Twitter.
Today, Jack Dorsey combines his time at Twitter with Square, Inc.’s development. The project was supposed to be called ‘Squirrel.’ According to the legend, such a strange name was explained by the fact that the miniature gadget for making credit card mobile payments looked like an acorn. However, the final product looked quite different: a small cube with a pin contact on one of its sides. As a result, the device was named Square.
Dorsey explains that Square is a specialized reader inserted into a mobile phone through the headphone jack. There is a magnetic stripe reader of bank cards inside, which allows information about the credit card placed in it to be obtained.
As stated by Roelof Botha in 2011, one of the leaders of Sequoia Capital (the company invested in Square for $27.5 million), they have been tracking the progress of Square service during the past 18 months. However, he noted that millions of small businesses still did not accept credit cards in the United States. According to him, it gives a huge potential customer audience for Square.
On August 8, 2012, Starbucks invested $25 million in Square. In addition, Starbucks CEO Howard Schultz joined Square’s board. For Square, the partnership with the largest coffeehouse chain is more important than money as it will help introduce the new service to many Americans.
On December 1, 2021, Jack Dorsey officially announced that the platform’s name will be changed to Block, Inc. He changed the company’s name mainly because of his interest in blockchain technology, and the new name would better encompass the various businesses under the company name.
How Twitter Makes Money
Why did Jack Dorsey fail to earn a considerable fortune on Twitter? Some experts believe that he was far ahead of his time. According to this theory, Twitter is one of the first products of the so-called Web 2.0. To cut it short, the usage of Twitter is determined by its users, who can post tweets about a delicious lunch, self-promotion, and information about cataclysms faster than traditional media to gather large numbers of people. Facebook and Google, by contrast, have limited tools, making users’ behavior more predictable; social networks are also convenient for making money through advertising. Dorsey initially did not want his company to make money; he wanted it to make news.
A few years ago, Stanford University professor Steve Blank said that Dorsey was not particularly interested in money making, probably because of modesty that he had been taught from his childhood. Being already world-famous, Jack lives mostly in rented apartments and spends much time using his famous name to raise money for various charities.
However, in October 2009, Twitter got its first revenue. According to BusinessWeek magazine, Dorsey earned $25 million, signing a contract with Google Inc. and Microsoft. The essence of the deal: Twitter messages become visible for Google and Bing. Later, he rejected Facebook‘s purchase offer.
According to the latest news, the value of Twitter shares increased by 182% since the company’s stock soared in IPO on November 07, 2013. Initially, the stock price was $26, but rose to more than $45 on the first day of trading. Analysts said that Twitter selected a conservative strategy at the initial offering.
Nowadays, almost 85% of Twitter’s revenue comes from online advertising on its site. Twitter offers three main ways for a company or an individual to advertise on its website: by promoting a tweet that will appear in users’ timelines, enabling a whole account, or promoting a trend.
Back to Twitter
In May 2016, Dorsey changed Twitter’s character limit, exempting photos and links from the count. This gave users more space to write longer messages, which Twitter hoped would attract new users and reverse the decline in daily tweets from 661 million in August 2014 to 300 million in January 2016.
On November 22, 2016, Jack Dorsey was suspended from his account, which had 3.9 million followers. However, after restoring his account, he tweeted that it was due to an “internal mistake.”
In February 2017, Jack Dorsey and Executive Chairman Omid Kordestani doubled the donation made by Twitter staffers to the American Civil Liberties Union (ACLU), bringing the total to $1.59 million.
In March 2018, the Twitter CEO revealed plans to improve the platform’s verification system. The redesign would enable users to verify more facts about themselves, focusing mainly on proof of identity. However, the new system was implemented after the U.S. midterm election in 2018, which would have helped verify the candidates’ identities.
In September 2018, Dorsey testified before the Senate Intelligence Committee alongside Facebook COO Sheryl Sandberg about meddling in the 2016 presidential election. Following this testimony, Twitter shares fell six percent.
Jack Dorsey privately met with U.S. President Donald Trump at the White House in April 2019. During the meeting, Trump expressed his concerns about Twitter limiting or removing his Twitter followers and those of other conservatives. Following their discussion, Dorsey tweeted about making Twitter “healthier and more civil.” Just a week before the meeting, Dorsey participated in a TED talk about how spreading abuse and misinformation on social media platforms has led to criticism.
On August 30, 2019, a group called Chuckling Squad allegedly hacked Dorsey’s personal Twitter account. They posted and retweeted many racist tweets for almost an hour.
In October 2019, Twitter attributed worse-than-expected Q3 results to advertising problems, including product bugs and deficient demand, sending shares down 21 percent. During this time, Dorsey was actively working to reduce the platform’s impact on political elections, which included banning all political advertisements. In addition, Dorsey shared news that Twitter would implement a global ban on all political advertising, including marketing campaigns related to political matters, starting November 22, 2019.
On February 29, 2020, news broke that Elliott Management, an activist hedge fund led by billionaire Paul Singer, had initiated efforts to oust Jack Dorsey from his CEO role and proposed the appointment of four fresh directors to the company’s board, with Jesse Cohn, Elliott’s senior portfolio manager, among them. A few days later, a resolution was reached, and Dorsey successfully retained his position as CEO.
In October 2020, the Senate Commerce Committee subpoenaed several CEOs of tech firms, including Jack Dorsey, to testify about the legal immunity social media platforms receive under Section 230 of the Communications Act of 1996. Roger Wicker, a Republican who chairs the committee, led the effort to hold the CEOs of Google, Facebook, and Twitter accountable.
On November 29, 2021, Jack Dorsey announced his resignation as Twitter’s CEO, effective immediately. In his departure letter, Dorsey expressed his belief that the business community overvalues companies led by their founders, which, in his view, is a limiting factor and a potential point of failure. Dorsey was replaced by Parag Agrawal, the company’s former CTO, who immediately took over as the new CEO. Dorsey is now leading as the CEO of Block, Inc. He left the board of directors of the social network in May 2022.
In October 2022, after Twitter was sold to Elon Musk, Dorsey retained his 2.4% ownership of the company.
Jack Dorsey’s Secrets to Success
One of Dorsey’s personality traits is that he works very hard. He spends eight hours at Twitter and then goes to the neighborhood street to work another eight hours at Block. Both of his companies are rapidly evolving and require total commitment from him. So, how does Jack Dorsey have enough time and energy to manage everything? He has a per-minute working plan for every single day.
“The only way to work in 16 hour mode – is to be very disciplined and plan your working day” – Dorsey says.
Here’s Dorsey’s work schedule for every day:
- Monday: Meetings and running the company’s work;
- Tuesday: Work on the critical product components;
- Wednesday: Marketing, positioning, and growth;
- Thursday: Developers and partnerships;
- Friday: The company itself and its culture.
Weekends are running a little slower, Dorsey says. On Saturday, for example, he walks, and on Sunday, he focuses on feedback and strategy of his companies.
“There always those distracting events appear, but I quickly deal with them and say to myself – this Tuesday I only work on product meetings and I have to focus on them.”
As of October 20, 2015, Jack Dorsey has a net worth of $2.3 billion and is admitted by Forbes as one of the world’s wealthiest billionaires. As of October 2023, his net worth is $3.1 billion. He is single. Jack considers his most outstanding achievement to be building a company of people who love their work.
We hope you have enjoyed reading Jack Dorsey’s biography, the fantastic success story of Twitter (now X) and Block Inc.
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