If a few auditions had turned the other way, Dick Costolo might have gone on to television stardom like Steve Carell, his fellow cast member of Chicago's influential Second City comedy troupe.

Instead, Costolo became chief executive of Twitter. On Wednesday, at the National Venture Capital Association's annual convention in San Francisco, he talked about the social network's rapid rise and looming future.

Speaking on a stage that had been graced hours earlier by IBM CEO Ginni Rometty and former Secretary of State Colin Powell, Costolo weighed in on the pros and cons of building a company in Silicon Valley's hyper-competitive job market. His first four startups — including Feedburner, which Google (GOOG) bought in 2007 for a reported $100 million — were based in Chicago.

There, he quipped, "You don't have to worry, 'I've got to get better burritos for my team or they're going to leave.'"


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With Twitter having shot from 60 employees when Costolo joined as chief operating officer in 2009 to nearly 2,000 today, he acknowledged that it's hard to stick to the mantra of hiring only the best employees. And sometimes, he said, "There are people who are great at certain phases of the company, and at other times, they're not the right person."

Twitter, famously, has seen a revolving door of talent at the top, as its three founders — Jack Dorsey, Evan Williams and Biz Stone — have shuttled in and out at various times. Costolo made clear that the same kind of transition happens in the lower ranks, and that managers sometimes bristle. "I'm constantly telling people it's not your job to defend your team," he said. "It's your job to improve your team. "

Preserving the company culture also poses challenges. In fact, Costolo created and teaches a management class to make sure new bosses don't try to bring in habits or philosophies they learned at other companies.

"I spend a lot of time telling new managers the ways they can create misery for their teams," he said. They key to avoiding that, he said, is clearly explaining the reasons behind decisions, which builds trust.

Costolo also doesn't like to see folks resting on their laurels. "One of the things I'm always challenging people inside the company is, you have to take more risks. We have to make bigger bets."

He did not address rumors that the company may go public this year — rumors that were further goosed this week when regulatory documents filed by a major investor indicated Twitter is now valued at $10 billion.

Asked by moderator Jason Mendelson, a venture capitalist at Foundry Group, how it felt to see events like Osama bin Laden's death being reported by Twitter users ahead of the mainstream media, Costolo admitted that in the heat of the moment, it's hard to philosophize about the company's impact.

During the recent Boston bombings, for instance, Costolo said his primary concern was for a friend who had been running in the marathon and tweeting his position from each mile marker. With millions of people subsequently tweeting about the bombings and the hunt for suspects, "You later on see this impact that you had," Costolo said.

He also pointed to the 2011 earthquake and tsunami in Fukushima, Japan. Twitter, he said, "quickly became an alternative form of communicating to get help, in ways that phone calls and text messaging couldn't." The company has been reaching out to organizations like the Federal Emergency Management Agency, the Red Cross and various overseas governments to help them understand how the social network can serve as a tool during emergencies.

On a more mundane level, he said, "When I'm amazed by Twitter is when you see the artificial barriers to communication that are eradicated." Whether due to boundaries of social status or geography, he said, "There are lots of different kinds of people who don't ever communicate. Then you'll see this woman in Canada asking the president to Rwanda questions like they're sitting together."

Costolo also drew a laugh when he recounted the tweet by Canadian rapper Drake that the first million dollars is always the hardest. Financier T. Boone Pickens responded immediately: "The first billion is a lot harder."

Asked by Mendelson whether Twitter might ever let users expand their messages beyond 140 characters, Costolo said no. "Real constraint emboldens all this creativity," he said. "You're forced into telling a story in a short amount of space." Likewise, he praised the team that developed Twitter's new video app, Vine, for limiting the mini-movies to six seconds.

As part of cooking up even more new products, Costolo said he'd like to give outside developers more leeway to "build into Twitter" and "let the canvas evolve." It's a touchy subject, as Twitter has over time riled the developer community by putting more limits on its APIs, the bits of code on which outside applications are built.

But keeping the product vibrant and ever-changing is key to Costolo's goal of emulating the growth of Amazon.com. "I think Jeff Bezos is amazing," Costolo said of the Seattle web giant's CEO. "The way he's thought about building out the platform that the company has is exactly the kind of model we want to build at Twitter."

Contact Peter Delevett at 408-271-3638. Follow him at Twitter.com/mercwiretap.