One of Jack Dorsey's babies is having a very bad day.
Shares of Square plunged more than 20 percent Friday, putting it on track for its biggest daily loss ever, after the mobile payment firm reported a bigger-than-expected first-quarter loss.
The firm, one of two companies run by Dorsey, posted an adjusted quarterly loss of 14 cents a share on $379 million in revenue Thursday. Analysts had expected Square to post a loss of 9 cents a share on $344 million in revenue, according to a consensus estimate from Thomson Reuters.
SQ in 2016Source: FactSet
The loss raised further questions about Dorsey's ability to run both Square and Twitter simultaneously.
"It's really hard to drive innovative companies, even one at a time, because the team has to be able to make really bold bets and feel like the entire organization is behind them," Josh Elman, a partner at Greylock, told CNBC's "Squawk on the Street" on Friday.
Square went public Nov. 19 and Dorsey has been Twitter's permanent CEO (for a second time) since Oct. 5.
Twitter in past yearSource: FactSet
"I think [Dorsey] is an incredible product thinker, but I think it's hard to see both companies going through the cultural change as public companies and continue to force the innovation while his time is split," Greylock's Elman said.