The Need for Speed: What Twitter's Approach to Reinvention Can Teach Business Leaders (in #Europe)!

Ecosystem Espresso Edition?#3 :

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2| The Need for Speed AND better strategic frameworks.

3| Marketplace 100.

The annual list of top Marketplaces and patterns by #a16z .

2| Need for Speed: What Twitter's Approach to Reinvention Can Teach Business Leaders!

This newsletter will provide Learning Boxes after each section or paragraph!

The bigger vision beyond Twitter as we know it.

“There's a product plan I wrote… in July of 2000, where I thought it would be possible to make the most valuable financial institution in the world,” Musk said. “That's part of why I think Twitter will be ultimately extremely valuable, because I’m going to execute the X.com game plan from 22 years ago—with some improvements.” (Source: Elon Musk, Arstechnica).

There are hardly any super apps in the Western world to my understanding. Different compared to Asia with #wechat or #grab . Think Ecosystem Architecture: pay, share, fund, create, monetise and more.

So, is Twitter set to become #theEverythingapp ?!

In tweets,?Musk mused ?that he “could be wrong,” but he expected that his purchase of Twitter would provide the infrastructure to launch his own super app within the next three to five years. That is one of the key reasons he acquired Twitter. #Masterplans get executed by Musk really well, although #InteractionNetworks are harder to succeed.

This big vision could also source from financial solutions of the previous Twitter Owner Jack Dorsey His #Block ecosystem is pretty impressive as well. We will cover it in another #EcosystemEspresso .

Some experts think it’s possible that if Musk moves quickly enough, regulators may not be prepared to keep up. And if he succeeds in racing ahead of regulators, Musk predicts that Twitter will go from a struggling platform that?only recently averted bankruptcy ?to an explosively popular, “extremely valuable” product (Source Arstechnica).

The back and forth of acquiring Twitter was really more like theatre. I admire the achievements of Elon Musk, and I do not have to agree with all he does. Nevertheless, what you can see here is definitely a learning opportunity for leaders and businesses:

LEARNING BOX #1:

Have a big vision and create urgency - not 10 years but 3-5 years out.

Redefining Its Purpose and Impact in Today's Social Media Landscape

So, now let's turn towards #Twitter2 .0. The platform had strong penetration but was on a path to bankruptcy within months. Drastic measures were needed. Yes, the style of Musk was arguable. But it was #CodeRed .

In a situation of all hands on deck and reset it is important to provide direction and install a sense of meaning. The #purpose just did that.

The purpose above is pretty good: It is relatively short. In real-life the "town square" of the internet will win and will be used in daily business among employees, partners and the broader ecosystem. We all know what a town square looks like and what its function is.

Purpose is not only to tick a box, but purpose-led businesses have more impact, attract talent, and are faster in identifying and building relations with ecosystem partners.

Our experience with purpose and brand-led transformations is very positive: our purpose and strategic destination methodology we have developed is inspired by artists, authors: rich language, communicating in pictures, analogies, metaphors and socio-cultural meanings. All customers using our approach are also long-term successful! We will feature this in a different #EcosystemEspresso newsletter and video.

Principles not rules

6 simple #principles guide the Twitter teams on a more operational level tying beautifully into the purpose. We use principles even more extreme "beaming" employees and partners into the future assuming you "were already there" and picturing how that would look like. We call those #perfpormanceprinciples . They create focus and commitment to products-services-experience with specific characteristics and not just lofty promises of advertising. Users react to what they receive and experience not what they were sold to.

In the case of #Twitter there are 6 #core #principles :

LEARNING BOX #2:

With ever increasing speed and more #decentralised organisations you will need some glue that helps all be empowered to decide. Everybody can assess easily based on a good purpose and #strategicdestination #principles : "does this help or harm getting there?"

Twitter makes progress and hits walls - all transparent

Musk is a master of not going the traditional marketing and communications path. He approaches #communityled and creates a loyal fanbase that offers to support. Remember #Tesla owners volunteering on delivery. In Twitter industry experts that have successfully completed exits even offered to help for free.

During March 2023 Twitter changed code and the whole system collapsed. This is not great, yet the transparency the Twitter team applied, was giving context and created patience.

LEARNING BOX #3:

Leverage #community and the fact that we are moving into a #creator economy. You are not confined by your marketing and sales resources. There is abundance, if you dare to be consequent.

Roadmap first and iterative adaptations

In line with the purpose and the need to make money fast and stop the bleeding a first set of core features were put out. Based on Twitter community feedback and experiments this approach was refined. Some things might not make it at all, others will make a big difference.

Core Features back from November 2022:

• Advertising as entertainment
• Video
• Longform tweets
• Encrypted DMs
• Longform tweets
• Relaunch Blue Verified

Elon is a master in throwing out ideas, have the community and experts sweat it and then decide. He is not shy to reverse 180° and does not mind losing face value. This got him here. Now he has nothing to proof anymore to anybody.

LEARNING BOX #4:

#Leaders should practice a #development and #entrepreneurialmindset . It is worse to plan to death and never get in front of users, than to reverse plans.

Platform and Interaction Network Principles in action

#Scalability (unit economics improve with scale) and #defensibility (first movers gain strong economic moat) are core in interaction networks.

The main way to achieve that: Improved product value...

A this point #onesided and #samesided #networkeffects are the focus: between users-users.

#UniqueUserIdentity is providing the foundation for interaction networks - we are all individuals with our unique persona or identity. Getting rid of bots and opening new sources of revenue was a need. The blue verification program is still in its infancy stage. The main task was to install trust, so that the ad funding could spill in again.

This was a top priority, where Elon was approaching big networks personally. Without them coming back, everything would have come to a collapse. Few advertisers like #Apple and #Disney were always loyal. Tracking #BrandSafety built trust. Big advertising networks are returning because of facts and transparency.

Flywheel and positive network effects only happen if the core interaction is incentivised and happening with high frequency. There would be no reason to go back to Twitter as user, if content was changing weekly or no cool people, creativity or topicality was happening.

During FIFA World Cup 147 Bn impressions of #WC2022 conversations proof reach and engagement. #Superbowl #56% video views. Innovation will focus to further improve ad relevance and performance-based advertising (right moment to engage).

To fight trolls and bots - remember the assumed high number of those was the reason for the back and forth during acquisition - the algorithms will promote verified creators who can in return build their audiences faster and monetise quicker and better. This is one of the incentives to become a aaS Subscriber for USD 8 per month. We saw in the meantime #Meta copy this approach.

In the coming weeks, Twitter will prioritize replies by:

1. People you follow

2. Verified accounts

3. Unverified accounts

At present, following the expansion of the availability of Twitter Blue over the last few weeks, Twitter has around?450k paying Twitter Blue subscribers , as per estimates from researcher?Travis Brown . That equates to 0.18% of Twitter’s?253 million total active users .

Curation limits access and secures value creation

#InteractionNetworks manage quality through curating in 3 ways in order for people to come back and even add a virality loop on top:

1. Editorial curation (did not work in past with all the bots and without verified accounts - see above).

2. Community curation (people are incentivised and attracted to call out unintended behaviour - see image below).

3. Automated curation (hardest and requiring a huge data base).

As a consequence of the above quality improvement is pointing into the right direction post acquisition. Building trust is essential. Consequently also other KPIs are shared and help build following:

I think most critics are following mainstream media, that are looking for negative headlines. You have to dig deeper.

LEARNING BOX #5:

#Leaders must understand core principles of #marketplaces , #interactionnetworks , #platforms and #ecosystems and put the right metrics and operations in place. Focus is the core interaction and the value of the product first! Without #retention you will not have a business model you can scale.

Test-Learn-Make bigger

You cannot decide at the green table alone. If there are simple principles agreed you do not even have to get engaged. Your meeting calendar and email in-box would look dramatically different. And you could do what you are mainly paid for: to lead! Successful leaders spend 40-50% on future and action for the future.

Below is a great example from the roadmap - back June 22? The reason is to increase usage and monetise Newsletters, authors etc. most likely.

This does not change the 280 characters at the heart of the "speed of the Town Square" positioning.

How the hell does he do that in 3 months?

Musk: "Given that Twitter serves as the de facto public Town Square, failing to adhere to free speech principles fundamentally undermines democracy.?What should be done?".

So Twitter 2.0 is Musk′s next mega business AND another example being personally driven by strong values and strong beliefs.

He puts in extra hours and builds the same success framework as before with #Tesla and follows core principles ruthlessly.

It can be done in a very short period of time - 3 months:

1. Personal preparation as a leader - writing the outline down on paper.
2. Strategic Destination with purpose and ambition (not yet visible on Twitter).
3. Crowd-Sourcing input from Communities (Musk is number 1 in reach on Twitter globally).
4. Agile Operating Model and right metrics.

Europe where are you?

Part of the reason of our 16x platform challenge is, that the strategic framework and deep understanding of networked business models is not there. Most businesses do not provide this clarity which also helps investors and incumbents to remain on course or patient but also correct directions radically, if needed. Without this framework you are doomed to use financials: #Topline and #bottomline . They are wrong for these business models. It is like driving a car blind in fog!

LEARNING BOX #6:

This is Europe's learning box: We do not scale because it is more complex...maybe. But also because we measure #EBITDA and not #growth and #cashflow . Europe is less willing to spend 5-10 years. Do not start new businesses or scale them without a complete strategic destination framework! This helps getting more runway!

Please share this newsletter and your thoughts. Feel invited to contact us via DM or #LinkedIn

3| Marketplace 100

Source: a16z - by Zach Cohen and Olivia Moore

12,000 companies using?Consumer Edge?to find the top 100 largest private consumer marketplace companies, ranked by gross merchandise volume (GMV).

Features nearly three dozen newcomers, including marketplaces for refurbished electronics, precious metals, and sustainably raised meat. Some of my favorite trends are noted below ??

1. Static e-commerce shopping is out, consumers are opting for more interactive and curated digital experiences.?Whatnot has rode this wave of changing consumer demand to #9!?Temu , which isn't eligible for the list because it's owned by Pinduoduo, would have made the top 10 in its first year!

2. As budgets became tighter, consumers spend shifted but did not disappear! As new and used car prices rose from inflation, consumer demand for upgraded vehicles remained. This spend shifted into car parts leading to debuts of?RockAuto, LLC ,?Parts Geek LLC , and CARiD.?

3. Unfortunately - mental health issues are as prominent as ever, but founders are working to democratize treatment. Unlike prior marketplaces in the space, newcomers focus on helping consumers find providers that are in-network with insurance.?Headway ,?SonderMind ,?Alma ?are all rewarding example of a marketplace fixing the discovery and matching problem!?

4. Revenge behavior is real and impactful but also ephemeral! The combination of pent-up demand and shows being postponed led to continued hyper growth in ticketing in the first half of the year....but we are seeing signs of a slowdown.

5. Marketplaces are getting opinionated, with platforms that carefully curate supply popping up across categories like food, clothing, and even pets. This is a stark departure from the wave of “anyone can list” marketplaces that dominated 2010 to 2020.