> Say what you will about Elon and Twitter, but he definitely proved that the majority of the engineers at Twitter were adding no value to the company.
Unless you care about revenue, which has been crushed due to Elon's actions. The company is less healthy than a year ago and still coasting on reserves of previous work and network effects. Musk is spending billions, and refusing to pay valid debts, just to keep the lights on. He admits that the company might end up bankrupt.
It blows my mind that anyone could be touting this as a well run business that others should emulate.
> While Elon is the only one with the intuition to bail out a company as large as Twitter
What intuition? Wasn’t he forced to buy Twitter by the SEC? He bought it at 4x the valuation - Twitter’s ex-shareholders made it out like bandits. Now he is losing money hand over fist thanks to Twitter - as Twitter’s ad revenue has dropped due to his changes (and big mouth) and he is paying to the tune of 1 billion USD a year in interest from the loan to buy Twitter; Twitter’s yearly income on the best of years have come nowhere close to a billion.
> For what I can tell, Elon bought Twitter to take it off the stock market, fix it as a private company, creating growth and profitability, and then list it later to make his money back.
A reminder that Elon had to be sued into buying this company.
I would love to see your source for that? To my understanding since twitter is private now no one has any idea what their costs structure or revenue is currently and are taking huge assumptions that they have issues because of events like them not paying rent etc. But some of that is common tactics to force people to negotiate.
I am not saying they are doing well, but currently I have no evidence in either direction
>>you have to get people to pay through other means.
Which ironically is twitter/x over all goal I believe, to not just be Social media but to bring in some of the original idea's that first made Elon rich... Paypal. Money Exchange, ecommmerce, now AI, etc etc etc.
Yeah, but that did a hasty negotiation that resulted in a no-due-diligence contract at that figure, tried very hard to escape the deal, including openly repudiating it and being sued to be forced to consummate it, and only relented and agreed to close on it in the face of court action to force him to which might have imposed additional costs as well.
So, while it is probably worth something, we can say that it is pretty clearly not worth $44B in the clear light of day, even to Musk.
Perhaps (probably) Twitter was overvalued, perhaps they're lying, but there's no evidence suggesting that Twitter is doing better than it was before and a lot of evidence suggesting otherwise.
That being said, I do think Elon's other bad decisions and press have caused the greater share of loss, and maybe charging users is getting some of that back. And one of Elon's goals, having people pay for content creators and services, isn't necessarily a bad idea; it's just that right now most people go out of their way not to.
> This is long overdue and the pain is a result of accumulated managerial debt.
The pain is the result of Elon Musk overpaying 3x for a company he didn't want to buy and aggressively cost cutting to lower expenses.
1 billion a year in debt interest payments due to the 12 billion in loans he took on to purchase Twitter matches reality more closely than "accumulated managerial debt".
> Twitter will be fine operationally.
I'm unsure how anyone can say this with any confidence.
> Letting go of these people also makes room for more wild thinkers and hacker types to join the party.
I think I met you at a gathering in SF once and had to walk away from the conversation.
> but strictly from a business point of view, buying Twitter for the purpose of profiteering was a bad one, but at his level, money has become irrelevant, its more about control here.
Agreed. Bezos, Gates, Musk, etc don't buy media companies for money. They buy it for influence, propaganda, etc.
> Having said that I do question how far he would be able to take the free speech thing as a private company.
I like Musk and generally support things he is trying to do. But I'm not holding my breath. No way he allows twitter to be a free speech platform. Nobody spends $44 billion to allow others to have their say. Nobody spends $44 billion for other people's benefit. Maybe he'll make some symbolic gesture like letting trump back on the platform, but I'm guessing twitter will be his personal megaphone to push his products mostly.
Or maybe this is a watershed moment and elon's purchase of twitter is the start of a shift back to what the internet/social media used to be.
>It seems far more likely to me that he ends up selling it to Google or something for pennies.
Although Elon appears to be aggressively driving twitter into the ground, this might be one of the few outcomes which actually increases the certainty of twitter getting killed.
> All Elon has done by buying Twitter is reveal how much of a trash company it was internally.
Except that's not true at all. What he did is saddle it with a bunch of debt and fire of a bunch of really-poorly-considered cosr cutting and revenue enhancement ideas that clearly weren’t thought through or part of a coherent strategy.
He might have and end-game vision, but he had no plausible roadmap to deal with the sucking wounded he inflcted with the acquisition, much less to get to his end-game vision.
> But, I wonder; are these the same people (managers) that were making decisions that allowed the company to loose $4 million a day?
Twitter is losing US$4 million a day now, with the added interests Elon has to pay back on his US$ 1 bi loan to buy Twitter. So using this claim as a justification is exaggerated, by the sheer fact that most of that US$ 4 million figure is from Elon's own creation.
> It seems to me Twitter's being run these days by an entrepreneur who's trying hard to figure out ways to make it a profitable operation.
Twitter was only losing 200-million in 2021.
The $1.3 Billion in loan-payments, followed up by the $2.5 Billion loss in advertisement revenue means that Elon Musk is personally responsible for a NEGATIVE $3.8 Billion differential in just 9 months of running the company.
You realize that, right? Twitter has _NEVER_ in its history lost this much money before.
I'm not sure how long it can go losing money like this. But I know it can't lose money forever, especially in a rising interest-rate environment, and double-especially on private equity. Eventually, Elon Musk will cut his losses and just shut the whole thing down.
So I'm not going to place a time-limit on when this all collapses and Elon Musk gives up on the project. I mean, I've seen how he dealt with SolarCity (a shady merger into Tesla to hide the fact that that other company also collapsed). So maybe Twitter "survives" through technicality in any case. Musk is very good at making failures look like a success (aka: exploded rocket was a successful test effect), he'll find a way to declare this $3.8 Billion / year loss a success too and have his fans eat up his story.
But I've already made my opinion up about this situation. Anyone who takes a company who is losing $0.2 billion/year and turns it into a company losing $3.8 billion/year in 9 months is... not a good businessman.
> But Elon has stated numerous times his reason for the takeover is not for economic reasons.
This is a hedge. If Twitter loses money Elon will say "I wasn't trying to make money"; and if Twitter makes money Elon will say "I made money despite not even trying". Win-win.
>All the debt you mention? He saddled them with that.
No, Twitter was already in debt. The alternative was letting it die, which mind you I don't think would have been a bad idea, but if Musk's goal is to keep it alive then the huge amounts of debt would certainly do that.
>Unfortunately he did that at the expense of site stability & reliability.
The site did not have the efficiency or importance to warrant the number of employees it had.
> So what is the difference between Musk and the previous shareholders? The main difference is that Musk put an enormous cost on the business which will be borne by twitters users and advertisers, and that cost brings twitter nothing more than having musk as an owner.
> By himself musk may be no better or worse than the previous shareholders. But just for him to rule over twitter is going to cost twitter a lot of money that will probably reduce the quality of the service.
It seems to me that his product-focused ownership (remember, he's a big user of Twitter) will either make it better or he will run it into the ground (due to naïvety and incompetence in this domain). Both seem like a win/win situation to me.
I think he has very strong incentives to make Twitter better because it is his stage, both for marketing his companies but also to stay int he limelight (ego).
Because it has to pay $15B of its own takeover price and Elon scared away advertisers.
I hope somebody paid Elon handsomely for driving Twitter into the ground. Otherwise he doesn’t look very much like a good businessman.
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