Their power comes from a combination of (1) the shares they own, (2) their balance sheet which allows them to outspend (litigation, buying more shares, buying bonds) anyone if they choose to do so, (3) their reputation as money-makers and being absolutely relentless in activist situations, and (4) the fact that generally they have a high batting average in these situations - in other words, they are often right about the need for change whether you think they're jerks or not. These guys pick their spots pretty carefully and they're good at what they do...the level of diligence they do would shock you.

I've been saying for a while that Twitter is one of the most no-brainer activist targets out there to the point where it's almost a layup. Executive compensation is outrageous, the CEO treats it as a hobby, lots of executive turnover, results have been mostly disappointing, R&D is inexplicable ($700 million to turn the star into a heart), a stock that's done essentially nothing since coming public years ago, and they really have no defenses (eg dual share class). And that's all before we even get to whether the company could benefit by dropping its brazenly liberal bias in how it polices content. I've been joking that Rupert Murdoch should buy it :)