Elon Musk has focused on free speech when talking about his planned acquisition of Twitter, but in discussions with bankers about raising funding for the deal, he was full of ideas on how to breathe new life into Twitter’s business.
Musk also came up with several ideas to increase revenue for the company, such as paying “influencers” to create content, following a business model that helped make TikTok a powerful social media app, people said. He also came up with the idea of subscription services that the company could sell.
The ideas came up in so-called “working groups” with bankers as he tried to secure funding for the deal, according to the people. The talks show that Tesla’s CEO is not just thinking about First Amendment issues when it comes to running Twitter, which he agreed to buy for $ 44 billion this week. He also wants to make money.
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The private conversations provide some of the only clues about Musk’s business strategy to take over Twitter. While Musk has made minor public suggestions, such as adding an “edit” button to tweets, he has not commented publicly on his broader strategy and has instead focused on the content moderation decisions the company has made. He has spoken publicly about freedom of speech on the platform, which he de facto called the town square.
Musk said earlier that the economy was not his concern.
“I do not care about the economy at all,” he said.
Still, the private conversations with bankers show some of the business acumen that has made Musk so successful in running his companies’ electric car maker Tesla and the rocket ship company SpaceX.
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Twitter and Musk did not immediately respond to a request for comment.
Musk’s acquisition of Twitter is unusual in many ways, including how quickly it came together. When he first made an offer to buy Twitter for $ 54.20 per share, he had not stated how he would fund the deal. While Musk is the richest person in the world, much of his wealth is tied up in stocks he hesitates to sell. Musk began approaching banks over the Easter weekend and a few days later came with agreements from banks to lend him more than half of the $ 44 billion needed to complete the deal.
Twitter’s board, which had initially rejected the offer, immediately began negotiating with Musk once he had secured funding, and the deal was signed earlier this week.
Musk’s statement after announcing the deal focused on the importance of Twitter, not as a business, but as a public space where people should enjoy First Amendment-like protection.
Musk’s ideas on how to revive Twitter were not part of a formal plan, these people said, and the loans he used to fund the deal were not conditional on any belief that Musk could make the social network more economical. successfully. In the working groups, Musk was critical of the way Twitter has been run, both financially and product-wise.
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These people said the deal came together so quickly, especially considering the dollar amount, mainly because Musk has such valuable assets that there is virtually no chance he will default on the loans. Twitter’s business prospects, these people said, were not a significant factor.
Because Musk’s offer to buy Twitter was hostile, bankers were unable to see anything other than public financial information about Twitter’s business health.
While Musk is known for his focus on technology and once considered taking a Ph.D. in physics, according to books and biographies, he is also an avid financial player who is able to recognize opportunities to quickly make a profit.
Bloomberg first reported the news that Musk was talking to bankers about cuts.
Rachel Lerman and Faiz Siddiqui contributed reporting.