What Twitter employees are saying about Elon Musk

Within the moments earlier than Elon Musk purchased Twitter, the corporate’s Slack channels have been lit up with nervous anticipation. It had been days since Twitter management had shared something with them, and after a weekend’s price of experiences {that a} sale was imminent, workers have been in search of solutions.

For the primary few hours of the morning, none got here. Work all however got here to a halt, workers informed me. Like a classroom the place the instructor is late and college students try to self-govern, one mentioned. A “hellhole,” mentioned one other. One thread, through which an worker requested good-naturedly whether or not anybody was excited concerning the prospect of working for Musk, drew dozens of responses, a lot of them fairly ugly.

Then, simply earlier than the markets closed, the information arrived: the board had accepted Musk’s provide to take the corporate non-public for $44 billion, or $54.20 a share. What started three weeks in the past as a “passive funding” will finish with Musk in cost.

After the announcement, sentiment within the public Slack channels remained largely involved and damaging, workers informed me. “I used to be sort of stunned how a lot individuals appeared like they have been giving up,” one informed me. “Huge bummer.”

However in one-on-one discussions, responses have been extra tempered. Some workers I’ve spoken with are open to the concept that a personal Twitter run by Musk stands a greater probability of enhancing the service than would a public firm beholden to its shareholders. They like the truth that he needs to remove dangerous bots and produce extra readability to how advice algorithms work.

On the similar time, many Twitter workers obtain half or extra of their compensation in inventory. At an all-hands assembly on Monday afternoon, they have been informed that workers won’t obtain fairness as soon as the corporate goes non-public. Consequently, one particular person informed me, “group chats are scrambling to see if working at Twitter makes financial sense in the beginning.”

The deal is anticipated to take round six months to shut. At the moment, it appears possible that CEO Parag Agrawal will go away the corporate, though he didn’t say so when addressing workers as we speak. Agrawal did say there wouldn’t be layoffs within the close to time period, although he wouldn’t touch upon whether or not there can be a hiring freeze. (There’s, nonetheless, a partial freeze on new options, though I’m informed that’s pretty customary throughout moments when there’s a number of consideration on Twitter and the corporate doesn’t wish to introduce any new bugs.)

Within the meantime… hiring can be tougher. There appears to be at the least some probability that the corporate will see important attrition, notably within the management ranks — and on the “well being” groups that work to battle harassment and abuse. On the plus aspect, the corporate’s earnings report Thursday not has the potential to additional tank its inventory.

Past that, as with every little thing associated to the Twitter-Musk story over the previous month, it’s extraordinarily troublesome to foretell.

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How did we get right here?

On one hand, Musk’s acquisition actually is a rare story. Buying 9 p.c of the corporate as a “passive” investor, failing to report it on time, getting invited to hitch the board, turning it down, then providing to purchase the corporate outright — that’s a particularly unusual flip of occasions.

On the opposite, as Matt Levine famous as we speak, as soon as Musk made his provide, the entire thing proceeded pretty usually. As a negotiating tactic, the board put in place a “poison capsule” to forestall Musk from buying any extra of the corporate. That compelled Musk to show that he really had the financing to get the deal accomplished. He did so, and the board thought of its choices. Finally, the 38 p.c premium that Musk provided over its present inventory value struck members as the perfect deal they might possible get.

Ultimately, it was simply enterprise.

Twitter has lengthy been an underperformer, and former executives I spoke with as we speak have been relieved that the corporate now has an actual probability to make radical change. As a personal firm, beholden solely to the pursuits of 1 man, Twitter could possibly remodel itself in ways in which it by no means might whereas it needed to report quarterly earnings.

The $44 billion query, although, is… remodel it into what?

“What’s Twitter for? Everyone who’s ever been in charge of Twitter has had a distinct reply to that query,” one former govt informed me as we speak. “It’s a query that has vexed customers because the creation of the service.”

There was the period after Jack Dorsey returned as CEO and tried to focus the product’s consideration on “what’s taking place.” There was the trouble led by former chief working officer Anthony Noto to make Twitter a vacation spot for stay video. Extra not too long ago, Dorsey oversaw efforts to each make the corporate a platform for “wholesome dialog” and to show it right into a decentralized protocol.

What does Musk assume Twitter is for? All now we have to go on is a collection of cryptic tweets and statements which might be quick sufficient to permit for huge interpretation. On this second, he’s nonetheless a largely clean canvas on which individuals can challenge their hopes (just like the Republican members of Congress tweeting “free speech is making a comeback”) and their fears (like these Twitter workers in Slack).

On stage at TED, he mentioned he didn’t care about “the economics” of Twitter “in any respect.” However given the way in which he structured his Twitter deal, he’ll face stress (if not insurmountable stress) to see a return on his funding. Listed here are Krystal Hu and Anirban Sen at Reuters:

Greater than two-thirds of the $46.5 billion financing package deal that Musk unveiled on Thursday in help of his bid for Twitter would come from his belongings, with the rest coming from financial institution loans secured in opposition to the social media platform’s belongings.

That’s the reverse of how most buyers construction buyouts, with debt secured in opposition to the belongings of the goal firm usually comprising the vast majority of the financing. […]

What’s extra, Musk has agreed to take out a dangerous $12.5 billion margin mortgage, secured in opposition to his inventory of Tesla Inc, the electric-car maker that he leads, to pay for among the $33.5 billion fairness verify. Have been Tesla’s inventory to drop by 40%, he must repay that mortgage, a regulatory submitting exhibits.

So, to keep away from having to promote a bunch of his Tesla inventory and repay his mortgage, perhaps Musk does discover that he has to care concerning the economics of Twitter.

Wherein case, what does he do?

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It’s modern currently to recommend Musk must get Twitter out of the advertisements enterprise. (Advertisements are out of style typically.) However as a feed-based social community, advertisements arguably nonetheless make a substantial amount of sense for Twitter, former workers informed me as we speak. When former CEO Dick Costolo embraced advertisements as Twitter’s future, one mentioned, it was as a result of “it was one of the best ways to take advantage of cash. it wasn’t due to an inherent love of promoting.”

The corporate might place a brand new emphasis on subscriptions, both by increasing its $2.99 Twitter Blue product or by scrapping it and constructing a brand new subscription product from scratch. (“Make energy customers pay for entry to their massive audiences” iis one concept that retains developing which appears believable to me.)

Or Twitter might lean tougher into changing into a decentralized protocol, promoting API entry to allow builders to construct quite a lot of completely different front-end experiences. That might allow completely different customers to decide on completely different kinds of content material moderation, whereas successfully turning the core service into an enterprise software program product.

I believe any of those outcomes is believable. But when Musk has a hand, he’s not tipping it. His official assertion as we speak bears little proof that he has thought a lot about what he’ll do with Twitter as a enterprise a lot past the shut of the deal:

“Free speech is the bedrock of a functioning democracy, and Twitter is the digital city sq. the place issues very important to the way forward for humanity are debated,” mentioned Mr. Musk. “I additionally wish to make Twitter higher than ever by enhancing the product with new options, making the algorithms open source to extend belief, defeating the spam bots, and authenticating all people. Twitter has super potential – I stay up for working with the corporate and the neighborhood of customers to unlock it.”

Maybe he’ll develop a stronger standpoint, and share it, within the coming months.

Within the meantime, the opposite massive query looming over all that is who will run Twitter each day. Musk already leads Tesla and SpaceX and the Boring Firm and Neuralink; presumably he won’t be spending eight hours a day on Twitter. Agrawal mentioned as we speak he intends to stick with the corporate by way of the shut of the deal; he would appear to be in line for a $39 million payout if and when Musk replaces him. Who will Musk belief along with his imaginative and prescient for the corporate? It’s one of many 12 months’s most attention-grabbing tech tales.

OK, there’s one different massive looming query over all this, which is will Musk let Donald Trump again on the platform? Trump mentioned as we speak he completely won’t return to Twitter even when he was invited. The previous president mentioned he’ll as an alternative use his personal platform, Fact Social, which he has utterly ignored after posting there as soon as. However some individuals identified that Trump has lied prior to now, and may even in reality be mendacity about this. Time will inform!

Over on my Twitter timeline as we speak, individuals have been going wild with essentially the most definitive, histrionic takes on what Musk’s acquisition will imply for the consumer expertise. Twitter is about to be overtaken by trolls and harassers; Twitter is about to re-learn 10 years’ price of classes about content material moderation the laborious manner; Twitter is about to see an worker exodus like none now we have ever seen. And so forth.

Possibly all of that’s true, or perhaps none of it’s. No less than among the worries would appear to be justified, primarily based on Musk’s previous statements. However the cart feels manner forward of the horse right here, and in any case predicting Elon Musk’s conduct is a mug’s sport. For all its cultural significance, Twitter had a notably undistinguished life as a public firm. For higher and for worse, it’s now as much as Musk to see whether or not it will possibly fare any higher as a personal one.