How Twitter Is Scamming San Francisco Not-For-Profits With Free Advertising

The bottom line is, the money Twitter isn’t paying the city could have easily been reinvested into that neighborhood or programs designed to alleviate the problems associated with it. Instead, it was given as a handout to a tech company to keep them from skipping town to nearby Brisbane.

According to the PEW Research Center, fewer than 16% of Americans actually use Twitter, which is why those hashtags in commercials and other television programming are incredibly annoying and stupid. It’s not that Twitter is a bad service, but most of us don’t care or even use it in the first place.

Regardless, if you believe that Twitter legitimately has 554,750,000 active registered users (I don’t), that would mean 88,760,000 of those accounts belong to active registered users in America. If we also accept as true that each month Twitter has 115 million active users, that would mean 18,400,000 of those users are American. That’s the number I would go with because active registered users can mean a lot of things to a lot of people. (Also: There are roughly 314 million Americans at the time of this writing, so 18 million may sound like a lot, but that also means 296 million Americans don’t use Twitter.)

You also have to figure, much like Facebook admitting that at least 83 million of their accounts are fake, that Twitter has an equally sizable number in proportion to their active registered users of fake accounts, spam accounts, and people with multiple accounts. And! That’s before we start factoring in that 40% of Twitter users just use the service as an RSS feed and that New York City has the highest population of Twitter users in America, not San Francisco. Even if you want to argue that half of Twitter’s active monthly users are based in the San Francisco Bay area, that would only mean there’s 9 million of them, which is totally impossible because there are barely 9 million people living in the San Francisco Bay Area.

So you see, those alleged eye-popping numbers that the media likes to gush over gets smaller and smaller the more you start to look at them critically. It’s just too bad our friends in the media refuse to do that out of fear of getting sued and losing access / business relationships with Twitter and these other companies. (I’m not kidding on either front. The “We don’t want to get sued” and “We don’t want to lose access” lines are things I hear often from the major media outlets.)

All of this is a long way of saying that Twitter’s multi-year, multi-million dollar tax break from the city of San Francisco, and Twitter primarily making up for those big tax breaks by teaching local not-for-profits how to tweet and giving them free advertising on their service, is bullshit.

Now, to be fair to San Francisco, Twitter’s HQ is located in a crappy neighborhood. If you’ve never been to San Francisco, parts of it are really nice, but then you start walking around and you realize real fast, “This isn’t exactly the city I can justify spending $2,700 for a one bedroom apartment”. So these massive tax breaks don’t stem entirely from a “we want to keep tech companies in San Francisco” perspective as much as the city wants to use Twitter as an anchor tenant to attract other companies and begin cleaning up a bad neighborhood. That part is fine. I totally get that and a lot of cities do this sort of arrangement all the time. What’s not fine is Twitter’s underwhelming fulfillment of their obligations to the city of San Francisco in exchange for those huge tax breaks. The bottom line is, the money Twitter isn’t paying the city could have easily been reinvested into that neighborhood or programs designed to alleviate the problems associated with it. Instead, it was given as a handout to a tech company to keep them from skipping town to nearby Brisbane.

Twitter is preparing for a multi-billion dollar IPO sometime in the next year or so. So it’s very “big” of them to donate $75,000 in donations and to claim “volunteer service” among other activities to help fulfill the deal they made with the city. To put that $75,000 in perspective, keep in mind that Twitter has a couple of employees based in Washington D.C. whose job it is to lobby on the company’s behalf as they’ve done against SOPA and for the JOBS act. Although no data on Twitter’s lobbying efforts can be found thus far in terms of cash spent, one has to wonder if the cost of the lobbying exceeds the cost of what Twitter is donating to local San Francisco charities. I’d argue that it does just by factoring in the salary of those two employees before we even talk about anything else that they did to get the JOBS act to pass.

The $75,000 is also a bit insulting coming from a company, according to CBS Market Watch, who is on pace to hit $583 million dollars in revenue in this year alone. I used to work for a bunch of not-for-profits, and at one point, I was on the board of directors for the St. Lawrence County Arts Council in New York. So, I take this kind of stuff pretty seriously, and as far as I’m concerned, Twitter is taking the city of San Francisco for a ride. And for what reason? Because they’re a tech company, so everyone gives them a break and pats them on the shoulder for totally phoning it in? That’s what it seems like.

Even some of the not-for-profits that received free advertising from Twitter reported to Buzzfeed that they didn’t know the full impact of those campaigns on their financials, with one reporting that they saw a small increases in followers and another saying they raised $2,000. Great NonProfits told Buzzfeed, “They gained 319 followers, 132 retweets, 27 replies, and 7,109 clicks”. Seriously. That’s how they’re measuring success here. Retweets, followers, replies, all of which are bullshit metrics. The only metric that matters to a not-for-profit, as sad as it is to say, are donations. As well intentioned as each of these organizations are, they can’t help anyone or fulfill their mission without the proper funding to do so. So followers, retweets, replies, and clicks don’t do anything unless there’s some kind of conversion at the other end of the sales funnel where those clicks translated into actual donations or volunteers arriving to help the not-for-profit out. Out of the organizations that Twitter gave the free advertising too, only one reported receiving any money, the $2,000, and then they also said “It’s hard to gauge what it [the free advertising] is worth.”

If I lived in San Francisco, I’d be pretty pissed about this. And if I was a not-for-profit living in San Francisco, given the limited success experienced by these not-for-profits and the overstated reach of Twitter, as fun as it is to play with, I’d say thanks but no thanks to the free advertising and take a large check from Twitter instead. Trust me, they can afford it.