Elon Musk’s acquisition exceptionalism

Twitter shatters

Illustration: Rebecca Zisser/Axios

All corporate acquisitions are at least a little messy. But what is happening in Twitter is in a class by itself.

Why it matters: Elon Musk risks setting fire to $44 billion, plus to a social media platform that has become central to global discourse.

  • Most of the money belongs to Musk, but a lot of it comes from Wall Street banks, fellow billionaires, mutual funds and venture capital funds whose own investors include charitable foundations and university endowments.

The big picture: We knew that Musk didn’t do any due diligence before he offered to buy Twitter, and that he didn’t think too deeply about Torney moderation of content. What we did not know is that as the months and the lawsuits continued, he did not lay the foundation for ownership.

  • There are no new C-Suite executives beyond Musk. There is no board of directors. There are no named members of a new content moderation council, and thus no new content moderation rules. There is no good reason that at least some of these people are not in place.
  • Musk did not hold an all-hands meeting to share his vision or any other information with Twitter employees, although some were scheduled and then canceled. Not even with the 50% of the workers he didn’t fire, or those he fired but who were already asked to return.
  • He spent months complaining about bots and spam, but then rushed to launch a more expensive subscription service that would automatically give verification checkmarks without actually verifying user identities. And then delayed the launch, although some people have already paid.
  • Brand marketers worried about how the chaos could bleed into what users see around their advertisements, leading to a “massive drop in revenue.” Musk tried to calm their fears, both in person and via tweets, but quickly grew impatient and threatened to go “thermonuclear.” on his own customers.

Back History: Yes, Musk wanted out of the deal and operates in at least a partial reality distortion field (arguably a justified one, given his Tesla and SpaceX successes).

  • But sources also say Musk knew the legal odds were against him, meaning his current problem was the most likely outcome.
  • In other words, he had every reason and opportunity to prepare. As any other customer would do. Instead, he chose to wing it, and then claim shock and ambush when things went sideways.
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The bottom line: Elon Musk is still early in the first inning of owning Twitter, but he’s already down a few runs.


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