It’s Doomsday for Twitter Staff as Elon Musk Takes the Reins
Elon Musk #ElonMusk
Good luck, Tweeps: Elon Musk is officially in charge.
CONSTELLATION BRANDS, INC.
The provocative billionaire completed his much-debated purchase agreement on Thursday, six months after he initially announced he was buying the company.
Multiple outlets confirmed the news on Thursday evening, though two Twitter employees told The Daily Beast they had not yet received confirmation from their bosses.
“As usual we’re the last to know,” one of them said.
Musk originally signed the agreement in April, but he attempted to renege on the deal by claiming the company lied about the number of fake accounts on its platform. Twitter sued Musk in Delaware court in July, hoping a judge would force him to uphold the $44 billion deal. (Musk filed a suit countersuit of his own.) The case was headed to trial this month, until Musk abruptly agreed to go through with the agreement at the original purchase price of $54.20 per share.
But the drama did not end there. Last week, The Washington Post reported that Musk had floated plans to lay off as much as 75 percent of Twitter’s workforce when he took the reins—a drastic cut that experts said could threaten the core of the company’s work. (Musk reportedly walked back the plan this week.)
Employees reacted to the report with nervous humor, posting tweets about whether the company’s headquarters in San Francisco might be converted into a Spirit Halloween store and quipping about its future with a minuscule staff.
Offline, one current employee was less inclined to joke. “It’s kind of insane to buy something just to burn it down,” she told The Daily Beast, speaking on the condition of anonymity. “That’s not sustainable, it can’t run on 25 percent capacity.”
The employee added that she and her coworkers were nervous about Musk’s impending ownership, because they “heard terrible stories about Tesla.”
A former staffer who recently left Twitter after growing alarmed about the prospective merger said that none of her coworkers had been happy about the buyout. “It was a mix of ‘I want to leave in protest,’ and just, ‘Let me find another job,’” she told The Daily Beast.
Ever the jokester, Musk stopped by Twitter’s offices on Wednesday carrying—for unclear reasons—a sink; he posted a video of his entrance with the caption, “Entering Twitter HQ – let that sink in!” The billionaire also changed his profile description to “Chief Twit.”
According to an email to staffers obtained by CNN Business, the firm’s chief marketing officer, Leslie Berland, explained Musk’s presence as “just the beginning of many meetings and conversations.”
“If you’re in SF and see him around, say hi!” she wrote, adding that their soon-to-be boss would address staff later in the week.
It’s not clear what immediate changes Musk has in store for the company. He has previously pledged to restore Donald Trump’s account (which was suspended following the Jan. 6 insurrection), otherwise reduce censorship, and expand the platform’s revenue streams. Just last week, he tweeted and then deleted a photo of himself, Trump, and the scandal-plagued rapper Kanye West dressed as the Three Musketeers and pointing to the names of their respective social media companies. “In retrospect, it was inevitable,” he wrote, of the trio.
Musk previously claimed the Twitter purchase was a stepping stone to creating an app he referred to as “X,” or “the everything app”—an analog to WeChat, which dominates much of online life in China. The purpose of the app would be to serve as a “global town square” that could also process payments, he said on a podcast in May. He later suggested the app’s user base could reach at least one billion people.
Musk is also inheriting a platform whose positioning appears weak. Reuters reported on Tuesday that Twitter’s own internal research reveals that so-called “heavy tweeters”—a small fraction of users that “generate 90% of all tweets and half of global revenue”—are in “absolute decline.”
In a research note on Thursday, Wedbush Securities analyst Dan Ives pegged the firm’s value at $25 billion, barely more than half of what Musk is shelling out. “The $44 billion price tag for Twitter will go down as one of the most overpaid tech acquisitions in the history of [mergers and acquisitions] deals on the Street,” he wrote.
Even Musk has admitted to overpaying for the struggling company, saying in a recent Tesla earning’s call: “Although, obviously, myself and the other investors are obviously overpaying for Twitter right now, the long-term potential for Twitter in my view is an order of magnitude greater than its current value.”
Read more at The Daily Beast.