We were too big, so we were paralyzed a bit by the idea that we were going to have to lay people off. Maybe I'm not giving us enough credit because we went from thinking podcasting was everything, to thinking we needed to find something else, ran five different experiments, ran at least two hackathons, and built and launched Twitter in seven months. But it _felt_ paralyzing to think about a radical change of staff.
We had middle management (me and a VP/Product) who arrived thinking our job was to make people productive. If you just wanted to experiment all day, why the hell were we hired? Somebody really needed to say: guys, we're changing modes. I think I probably needed to hear that multiple times.
We had investors who got bought out. As one said, "Ev is going to either be remembered as a genius or as an idiot." He was very gracious about it, paid more than he needed to for Odeo and then I believe let many of the investors back in when Twitter got funded. But at the end of the day CRV was the primary backer of the company that built twitter and Union Square is the primary backer of Twitter.
Once you change direction, when do you say "this is it" and actually sit down and figure out how you're going to make it happen? Because for a lot of people at the company, so many changes in direction made it hard to know for sure that Twitter really was the new direction.
I think Odeo was unique in this regard. I think it comes from having an engineering driven culture, rather than a management driven culture.
Also, it is very surprising but a lot of startups still think that ideas should come from the top, rather than anywhere in the organization. I could write a whole book on this.
I think it came from the Odeo founders, Ev and Noah. When they have an idea, they can be very forceful personalities. But when they're unsure, they both were good listeners and open to all possibilities.