Truth Social Shares Jump Nearly 40%
Shares of Donald Trump’s media startup catapulted a head-spinning nearly 40 percent in just a single trading session on Monday.
Before you chalk it up to the market’s occasional lapse into irrational exuberance or the speculative frenzy that grips the unwary, it’s worth peeling back the layers of this particular onion. Beneath the tear-inducing ascent—the stock is up more than 130 percent year to date and close to its all-time highs—there are some shrewd calculations that could vindicate those who have decided to tie a part of their fortunes to Trump’s.
As we discussed Friday, the basic business case for Truth Social is that the social media space is likely to fragment along political lines just as traditional media has. Conservatives will likely seek out digital forums where their views are welcomed and debated rather than suppressed. Progressives will gravitate toward platforms that shield them from exposure to dreaded reactionary thoughts that they fear may corrupt their souls or endanger what they insist on calling “our democracy.” The multiverse is coming for social media.
Truth Social isn’t just another entrant into the crowded social media arena. It represents a haven for those wearied by what they perceive as the heavy-handed censorship of traditional tech giants. Herein lies its peculiar charm: it offers not just a digital space for discourse but a bastion of free speech for its adherents. This unique selling proposition taps into a vein of societal discontent, suggesting that Truth Social’s appeal may extend beyond the current election cycle or even the political career of Trump.
Of course, the case for Truth Social was even clearer when Twitter was being run by progressive ideologues collaborating with a network of government and non-governmental institutions to suppress conservative thought. Elon Musk’s acquisition of Twitter, and its transformation into X, creates a natural competitor for Truth Social that did not exist a few years ago.
Opportunities for Conservative Social Media Abound
The $300 million or so of funding that the merger of Trump Media and Technology Group with Digital World Acquisition Corp. will bring to the venture gives the company an opportunity for expansion beyond just the digital bulletin board forum in which it currently exists. It could become a platform for original video and audio content, hosting podcasts and television shows of exiles from establishment media like Lou Dobbs and Tucker Carlson. It could also expand into the digital publishing space, with Substack-like offerings of subscription materials.
The missteps of the big artificial intelligence initiatives, such as Google’s Gemini, also create opportunities. What if Truth Social offered to create historically accurate images of, say, America’s founding fathers instead of the diversity, equity, and inclusion hallucinations? A search engine not built around the social and political priorities of Google would also be attractive.
And, of course, we should not overlook the influence of Trump on the platform. The once-and-perhaps-future president has a knack for transmuting controversy into attention—and, crucially, into engagement. This is a commodity as precious as gold or Bitcoin in the digital realm, where engagement translates directly into advertising and subscription dollars. Investors, it seems, are betting that Trump’s Midas touch in garnering media attention will extend to monetizing digital space.
But It’s Not a Sure Thing
Investors should not don rose-colored glasses. The success of Truth Social is not guaranteed. If it does begin to gain traction with a user base of significant size, it will surely attract slings and arrows from outraged censors. There will be calls for it to be thrown off of servers of respectable companies or blocked by the makers of mobile phones and tablets. If they think Trump endangers democracy just by running for president, just wait until he’s running a digital news network, a search engine, and an AI company.
Former President Donald Trump’s social media platform Truth Social is shown on a cell phone on March 25, 2024, the day before the company is expected to go public on the NASDAQ market under the ticker symbol DJT. (Scott Olson/Getty Images)
There’s also the problem that a lot of the names associated with the company are not deeply experienced with running a social media platform. It remains to be seen whether they can hire and retain the talent required for such a platform. Only with the passage of time will we see if the current management team can realize Truth Social’s potential.
No one is buying into Trump Media & Technology Group believing it is a sure thing. It’s a calculated risk, a wager on a unique confluence of societal and political balkanization and increasing digitization of media. It’s also a rare opportunity for supporters of Trump to put their money where their mouth is and perhaps to financially benefit from the Trump vision they find compelling.
The phenomenon of Truth Social’s rocket to the moon on Monday reminds us that the market, much like the broader tapestry of American life, is a complex and vibrant mosaic, animated not just by the cold calculus of investment but by the passions, dreams, and aspirations of its participants. The rise of Truth Social speaks to a collective yearning for spaces where discourse flourishes, unfettered and unfiltered — a yearning that, in the end, is profoundly human and deeply American.
