I invested in Twitter as I believe in its potential to be the platform for free speech around the globe, and I believe free speech is a societal imperative for a functioning democracy.
However, since making my investment I now realize the company will neither thrive nor serve this societal imperative in its current form. Twitter needs to be transformed as a private company.
As a result, I am offering to buy 100% of Twitter for $54.20 per share in cash, a 54% premium over the day before I began investing in Twitter and a 38% premium over the day before my investment was publicly announced. My offer is my best and final offer and if it is not accepted, I would need to reconsider my position as a shareholder.
Twitter has extraordinary potential. I will unlock it.
/s/ Elon Musk
This morning, Twitter (the app) and Twitter (the company) was literally blowing up as Elon Musk submitted an offer to take the company private. This, after some exceptional trolling over the weekend, including running this poll.
I mean, wow. Even I was surprised that Elon would be so glib given that he had agreed to join the board, but when news came out Sunday he wouldn’t be, the Tweet storm made a lot more sense. To join the board, Twitter required that Elon be restricted from acquiring more than 14.9% of the company and was prevented from a hostile takeover, including 90 days after he resigned from the board.
The move pits two core principles of the Progressive and Democrat party today against each other. On one side is Elon, the EV promoter and saver of the planet and other the other is Elon, the bastion of free speech on an unregulated internet. But we live in crazy times and the new normal is that two thoughts can come from the same person and be totally diametrically opposed:
“I want you to look at my eyes. I guarantee you. I guarantee you. We’re going to end fossil fuel.” - Joe Biden, September 6, 2019
And then…..
“Our view is that the global recovery should not be imperiled by a mismatch between supply and demand. OPEC+ seems unwilling to use the capacity and power it has now at this critical moment of global recovery for countries around the world.” - White House Statement, November 4, 2021
But here we are.
When it comes to free speech, Robert Reich, perhaps my least favorite man on the internet, summarized the view of those that would protect you from …. from… well, actually I don’t know, but here it is.
Musk says he wants to “free” the Internet. But what he really aims to do is make it even less accountable than it is now, when it’s often impossible to discover who is making the decisions about how algorithms are designed, who’s filling social media with lies, who’s poisoning our minds with pseudo-science and propaganda, and who’s deciding which versions of events go viral and which stay under wraps.
Make no mistake: This is not about freedom. It’s about power. In Musk’s vision of Twitter and the Internet, he’d be the wizard behind the curtain — projecting on the world’s screen a fake image of a brave new world empowering everyone. In reality, that world would be dominated by the richest and most powerful people in the world, who wouldn’t be accountable to anyone for facts, truth, science, or the common good. That’s Musk’s dream. And Trump’s. And Putin’s. And the dream of every dictator, strongman, demagogue, and modern-day robber baron on earth. For the rest of us, it would be a brave new nightmare.
Apparently he missed that Mark Zuckerberg controls Facebook and Jeff Bezos owns the Washington Post.
For Elon, I think the move is genius. Free speech does need help, and a censorship free Twitter would be far better. One that didn’t suspend the NY Post for the Hunter Biden laptop story that is now unequivocally true. One that could justify a permanent ban on the former President while the Kremlin still maintains it’s account. One that could suspend Nicki Minaj for tweeting about her cousins swollen testicles. And one that still had Alex Berenson and Alex Jones.
I believe that no content or user should be blocked. Ever. If the fact checkers want to highlight problems, their posts and responses and rebuttals should be connected to the original content for the reader to evaluate. As CEO of a private Twitter, Elon would have the power to fix it.
But why now? To me, everything comes down to money. Climate change is about getting the world to spend $131 trillion to rebuild an existing electric grid that will generate $40 trillion in new wealth. COVID was about…. well, we know that Pfizer guided to $50+ billion in revenue for the vaccine in 2022. For Elon, he’s not dumb. Every car maker in the world is pushing to EVs. Input costs are going through the roof as Tesla has already raised it’s prices for the Model 3 $10,000 over last year’s price. All this should mean Tesla’s $1 trillion valuation is finally at risk.
Other evidence Elon knows the gig is up? Last year, he ran a Twitter poll as to whether he should sell 10% of the Tesla stock he owned. 57.9% said yes, so he did.
His cost basis was $142.6 million, the sale price was $23.6 billion, resulting in paying ~$9.635 billion in taxes (for those who think the rich don’t pay “their fair share” Bill, Mark, Jeff, Warren… your turn.)
Elon is worth ~$250 billion. Post sale, he owns 17% of Tesla valued at $170 billion. He owns 47% of SpaceX valued at $35 billion. And now, with 9% of Twitter valued at his takeover price he has $3.9 billion there. Tesla is not fundamentally worth what an Amazon and a Facebook and a Microsoft are. Elon knows this. If Tesla falls 90% in value, that’s a huge wealth hit to Elon’s aspirations and power relative to Jeff, Bill, Mark and Warren. So how do you sell without triggering a massive exit of the stock? A high profile takeover battle for Twitter seems just the ticket.
I have had an on again, off again battle with Twitter but even I can’t stay away. The embedded tweets in this article are proof that whether you are on the platform or not, the world is moved by what is said.
Scott Galloway, who I wrote about in my “The Wo(Man) behind the Curtain” piece on the CNN/AT&T takedown of Joe Rogan and Spotify, wrote an article this week called @elon on his twitter buy. He was bitter, having written an activist letter to get rid of @jack and feeling slighted that he was bested because he was circling capital to take over Twitter this year as well. Nothing like a scorned would-be-acquirer to provide an be unbiased assessment.
Where to begin? Some basic law: Free speech is essential to a functioning democracy, but free speech is a protection from government limits on speech. Free speech doesn’t limit Twitter … it protects Twitter. Rigorous adherence to the principle of free speech means Twitter shapes its own voice, which, if it decides, is not amplifying hate speech, false speech, or speech calling for insurrection. Users who want that content can find it elsewhere, such as 4chan, or Truth Social (not really … DOA). Free speech principles are government principles, just as censorship is government action. Everything else is competing speech.
Moreover, Twitter is an important space for communication, but “free speech principles” and “democracy” do not require or even suggest that Twitter let anyone say anything. On the contrary, they militate for reasonable moderation. An unfettered forum is not free, it’s an invitation to mob rule. If Twitter is the “de facto public square,” that’s because the site moderates content, not despite its efforts to do so. Almost nobody wants unfettered speech on Twitter. Imagine your email inbox but with no spam filters … times 280. Moderation is why 4chan gets 20 million users per month, while Twitter gets 217 million users per day.
In practice, Elon’s interest in “free speech” has been mostly about intimidating journalists who wouldn’t be stenographers for his unfoundedclaims. His solution was a website where people could vote up or down on journalists, where the magic of crowds would fix media. He wanted to call it Pravda. Today, Pravda, like so many Elon missives, is long forgotten, and Elon’s answer to the problems facing Twitter is: “Something … something … open source.”
But, for all the vitriol, there is a driver to the acquisition. Facebook is a $577 billion company. Google is $1.7 trillion. A huge portion of their revenue is from ads.
In my view, a censorship free internet, complete with a subscription based payment model supplemented by ad revenue for free users leaves a huge opportunity for Twitter to capture. I can’t say it better than Professor Galloway did, though me disagrees on censorship:
Twitter should move to a subscription model (#fuckingobvious). Corporate users and users with large followings would pay for a fraction of the value they receive. I have long advocated for this model.
Elon is a complicated character, but he’s also the world’s richest man. He has a lot of skeptics and 88 million followers on Twitter. As a passion project legacy, fixing Twitter is a huge but essential job for the future of the “town square” freedom of speech. And for him, when to are exposed to a $153 billion loss of wealth from a declining Tesla stock, maybe there has never been a better time for @elonmusk to do what Elon does best. Disrupt. But I still won’t buy a Tesla.
Wow…lots of brain energy went into this one. Thank you, David, for thinking out loud. I hope you enjoy your Thanksgiving and that you all stay healthy even as you are surrounded with RSV! Drink organic not from concentrate GRAPE JUICE and consume massive amounts of Zink & C…try ZStack…it’s the best!
Wow…lots of brain energy went into this one. Thank you, David, for thinking out loud. I hope you enjoy your Thanksgiving and that you all stay healthy even as you are surrounded with RSV! Drink organic not from concentrate GRAPE JUICE and consume massive amounts of Zink & C…try ZStack…it’s the best!