Elon Musk has said he’s a free-speech absolutist.
Jae C. Hong/AP
Following an unconventional takeover bid, Elon Musk is backing out of the Twitter deal.
The $44 billion deal had sparked speculation about the future of leadership at Twitter.
Elon Musk’s disclosure that he plans to walk away from his acquisition of Twitter raises new questions about the fate of the social media platform’s management structure, which was set for a shakeup had the brash CEO completed his acquisition.
The founder of Tesla, SpaceX, Neuralink, and The Boring Company said in a filing with the Securities and Exchange Commission on Friday that he planned to abandon the $44 billion deal. The acquisition would have placed the world’s richest man at the helm of one of the most powerful social platforms.
The takeover bid had sparked immediate speculation about the future of leadership at Twitter and whether Parag Agrawal, the company’s CEO, would remain in the role or see the end of his short tenure. Reports had said Musk would serve as temporary CEO of the company. Musk could face a prolonged legal battle and hefty fine if he does walk away from the deal.
The prospect of Musk running yet another company raised questions among Twitter users and staffers alike. Known for his visionary leadership and out-of-the-box thinking, Musk took Tesla from a fringe brand to the world’s most valuable car company and ealier this year sent a four-person civilian crew into orbit in a SpaceX spaceship.
Experts who spoke with Insider prior to Musk’s decision to scuttle the deal said it was tough to predict the moves of such a characteristically unpredictable figure. “It’s impossible to know what Elon Musk will do next,” said Richard Levick, the chair and CEO of Levick, a crisis-public-relations firm.
Levick’s firm has represented Musk’s private spaceflight company, so Levick has firsthand knowledge of Musk’s penchant for unpredictability.
“I remember one night in particular he called at 6 or 7 o’clock at night and said, ‘I’m flying into Washington. Can we do a press conference at 9 o’clock tomorrow morning?’” Levick said. “We pulled it off, and the press conference was a success, but I share that story because I think it’s indicative of no one knows what Elon Musk is thinking, and sometimes not even Elon Musk.”
Insider spoke with experts including Levick; a reputation-management consultant; and a CEO consultant about how Twitter’s executive leadership could have changed under Musk. Their two biggest predictions were that changes were imminent and that a CEO swap was likely.
Change on the horizon
Musk has been public about his grievances with Twitter’s leadership. Musk, who has 100 million followers on the platform, posted a barrage of tweets in April criticizing two of the company’s top executives.
Jim Baker, a deputy general counsel for Twitter, faced trolling after Musk affirmed a tweet by the right-wing activist Mike Cernovich accusing Baker of committing fraud as a general counsel for the FBI. Twitter’s policy and legal head, Vijaya Gadde, also faced online harassment after Musk described her decision to restrict a news story on the platform as “incredibly inappropriate.”
Experts argued that Musk’s rifts with top executives were clear indicators that Twitter’s leadership would change under his watch.
“I think you’re going to see a painful cascade of carnage,” Eric Schiffer, the chair and CEO of Reputation Management Consultants, said when the acquisition still appeared on track. “It will be an emotional whiplash to many of the executives who had a comfortable position.”
Musk had also made clear early on that he had intended to transform Twitter into a bulwark of free speech. In response to a tweet criticizing “the extreme antibody reaction from those who fear free speech,” he said: “By ‘free speech,’ I simply mean that which matches the law. I am against censorship that goes far beyond the law.”
Twitter has taken steps to remove some content it deems to be in violation of its terms. Most notably, it removed then-President Donald Trump from the platform following the January 6 insurrection. The company cited the possibility that the outgoing president could foment further political violence.
Levick questioned whether Musk would have been able to establish the kind of free-speech rights he envisioned globally across the platform. “They don’t have the First Amendment in China,” he said. “European regulators are way out in front of the Americans in terms of regulating the internet. How will he handle the Digital Services Act that the EU recently passed?”
Going private would have meant Twitter would be freed from issuing quarterly financial statements. Jay Baer, a digital-marketing consultant, suggested that not being bound by such restrictions would have made it easier to implement sweeping changes to the company’s leadership and revenue model.
Last year, Twitter reported revenue of about $5 billion.
“I think he truly believes that with some changes, there could be a colossal midterm increase in revenues and profits,” Baer said of Musk. “Ultimately, I don’t think he makes a move like this unless he sees financial upside.”
While some observers have lauded Musk as a decisive leader, his moves are often confounding to those who follow his companies. “I think it’s very hard to interpret what he’s doing and his intentions. I think we are wrong to assume that he will necessarily get deeply involved in the day-to-day operations,” Tom Goodwin, a CEO consultant, said of the potential takeover.
Musk as Twitter CEO
Agrawal, who replaced Twitter’s founder Jack Dorsey as CEO last year, took the helm at a critical point as the platform introduced revenue-producing features such as its Blue subscription product and Ticketed Spaces, which allows creators to charge for exclusive access to their content.
Following Dorsey’s announcement of Agrawal’s appointment, Musk posted a meme of Agrawal’s head atop the body of Joseph Stalin, the Soviet leader known for his strict censorship. In an SEC filing in April, Musk said he did not “have confidence in management.” Given Musk’s vehement criticisms of Agrawal, removing the current CEO would not have come as a surprise to experts.
In a companywide town hall following the announcement of Musk’s acquisition, Agrawal told employees that the future of Twitter under Musk was uncertain, Reuters reported.
Baer said at the time that Agrawal’s then-predicted expulsion shouldn’t have been seen as a result of incompetent leadership.
“Given the amount of tumult internally and globally during his short tenure, I don’t see too many ways he could have done better,” Baer said. “The platform is as vital as ever as a cultural touchstone, globally.”
Musk’s tendency toward brashness and off-the-cuff tweets posed questions about his approach to free speech and his ability as Twitter’s would-be owner and CEO to use the platform as his personal megaphone. And the experts who spoke with Insider said that while Musk had demonstrated success as a leader, it was anyone’s guess what he’d do next.
This article was originally published on May 3.
Read the original article on Business Insider