Jan 27, 2016 · 7 minutes

Even I am starting to feel bad for embattled Twitter CEO Jack Dorsey.

We’ve been the loudest critics in the tech press for the founder coming back as Twitter’s part-time CEO, and a lot of the moves he’s made since he did, starting with throwing former CEO Dick Costolo under the bus on his first earnings call without seemingly any plan to solve the same underlying problems. (Unless that was supposed to be Moments?)

The stock has traded down most days this year and has lost some 50% of its value since he took over. And this week came the bungled messaging around five executives leaving the company, with “off the record” speculation it was some kind of house cleaning and on the record statements and evidence that the moves were voluntary. Dorsey was forced to step in and contradict his own leaky insiders to confirm that he hadn’t fired anyone.

There are still some reporters (and a lot of fans) desperate to believe that every Dorsey misstep is somehow part of his grand plan for saving Twitter. Those people will insist that, despite his own denials, Dorsey masterminded an executive purge in order to make room for his own dream team of saviors. Even if that were true (again, it isn’t), TIME nails it today when it says this:

Dorsey has his choice between two unpalatable narratives. Either his top lieutenants are being forced out in purge, or they’re fleeing on their own. Neither narrative tells a story of a company moving forward. 

Ben Thompson of Stratechery also nails it when he wrote this:

Unfortunately for Twitter the attention market of 2016 is far different than it was back in 2009. When Dorsey states that he wants Twitter to “become the first thing everyone in the world checks to start their day and the first thing people turn to when they want to share ideas, commentary, or simply what’s happening”, he is no longer trying to capture an entirely new market, but rather to steal that market from well-established competitors, particularly Facebook, but also services like Snapchat, Instagram, and the messaging services, all of which have feeds of their own.

Indeed, Dorsey seems to believe time has been frozen since the first time he was CEO. As we wrote when the idea to extend Tweets to 10k characters came out:

Look at the company who is stealing the most relevance from Twitter. It’s not Facebook, it’s Instagram and Snapchat. Which are inherently visual and video mediums, not homes for long form text. Does Dorsey even know what year it is?

Here on Pando, we’ve written a lot about what Dorsey is doing wrong. In response, some have asked me on via social media what Dorsey should do given all the many things that haven’t worked since he returned. I don’t invest in companies I write about, but if I did, what would make me consider buying the stock? Just because it keeps falling isn’t a reason, nor is cash on hand or nebulous value of underlying assets that Wall Street just doesn’t “get.” (See: Yahoo.)

I wouldn’t buy the stock if they fire Dorsey and try to hire some nebulous turn-around specialist. They shouldn’t have given him the job, but they did. Just ripping-and-replacing CEOs rarely works when a company hits this point. Another search will only introduce more turmoil and encourage more of an exodus of whatever talent is left. (See, again, Yahoo.) It’ll hurt recruiting too.

There are still a lot of people who admire Dorsey, whether Wall Street and Twitter users are enamored of him or not. He doesn’t have much, but he has the founder mantle. He’s done more damage since coming back, but kicking him out only makes it worse. The narrative is then that Twitter is just unfixable. Whoever comes in next would rip and replace far more of the things that most users love about the service. Just  monkeying around with character length would seem like benign tomfoolery. Dorsey knows Twitter, even if he doesn’t always seem to know who his main competitive threats are or what year it is.  

Nor would I cling to some hope that Twitter is about to get bought. People keep hoping there’s some deal to be had with Google, but Google doesn’t have a history of buying distressed assets and Twitter is looking worse with each piece of news that comes out. Twitter is still worth some $11 billion dollars. Google could get a surging upstart for that price. Plus, Google hasn’t been buying much of anything lately.

A trial balloon was floated that News Corp may buy Twitter, and its stock traded up on the news before News Corp came out and flat denied that there was any truth to it.

Some have pretended Facebook might buy Twitter. Hey! They buy a lot of stuff! They once tried to buy Twitter! Please. Facebook stopped needing Twitter when it bought Instagram: Mobile and celebrities? Done.

Today, Facebook controls three of the four largest messaging platforms. And the other is Snapchat, not Twitter. Unlike Dorsey, Mark Zuckerberg gets the world we are in now. The future is Messaging, not social, and it already looks like messaging is going to be even bigger.  Zuckerberg lives enough in the future, in fact, he spent $2 billion on Oculus Rift well before you could buy the product on the off chance virtual reality becomes a future ad platform.

Here again, consider the price. Facebook is gonna pay 60% of a WhatsApp to get….Twitter? Given what it’s built from scratch with Messenger and bought for a measly $1 billion with Instagram? No one can articulate the value of that deal with a straight face.

Even my own modest proposal-- that Yahoo and Twitter should merge-- is totally unlikely in reality. What would many on Wall Street hate worse than those companies on their own? Those companies together.

The only real option would be an international buyer wanting to get into the US market, likely from China. That’s the only scenario where I can imagine someone has the cash to stomach the still-high price and would have a unique reason to see enough value in the deal.

Twitter is poised to add two new board members, and we’ve heard they are impressive ones. But the biggest beef with the board was giving a part-time CEO the job over Wall Street’s objections. While rare good news for the company, it’s hard to imagine that reverses the slide.

So with all of those options off the table and Dorsey needing time to come up with anything that would actually revolutionize the product and Wall Street pretty much telling him they aren’t giving him any time, what should he do?

Easy: Announce he is hiring a replacement at Square and focusing on turning Twitter around full time. And do it at or before earnings on February 10.

The reason Dorsey got off on the wrong foot with many investors was the arrogance that he could do both, having never lead even one public traded company before. The board ignored the concerns. Similarly his promises amid the executive departures that he was going to “[partner with Adam Messinger] day and night to make sure we’re building the right experiences” are clearly hollow ones when he has another job.

Meanwhile, while Square is slumping this year it is in far less disarray. It is also at a point in time where it needs Dorsey less. Square has evolved into a small business software and services company. It’s long since given up its consumer facing app, and its period of jaw-dropping innovation-- of reimagining an entire market a-new-- is behind it. It needs to execute. Twitter needs to be reinvented. Assuming you are a Dorsey-fan-boy, which of those is the thing he’s supposed to be so Steve Jobsian at?

From an ego point of view, it’s the Twitter turn-around that will make or break his reputation as an executive. Few people are closely watching Square.

The one positive move-- one even I can’t fault--that Dorsey has made this year was giving up some of his shares to compensate other Twitter employees who stick with the company. Employees respond to actions. And that spoke loudly that Dorsey was committed financially to making this work.

But you know what’s a lot more scarce and valuable than money for someone like Dorsey? His time. Announcing he’s handing Square over to someone else and committing 100% of his time to Twitter would send a loud, clear message to employees, shareholders and the rest of the world that Dorsey really is committed to spend “day and night” making Twitter a competitive product again.

Anything else is just ego and empty promises. And we’ve seen so far how much Wall Street values those.