Elon Musk, pictured at the Met Gala on Monday, reportedly told potential investors he could take Twitter public after as little as three years.
After announcing to investors that he planned to take Twitter public again within three years, Elon Musk assured his followers that the social media site would remain free for most users.
Following a report on Tuesday that Musk, 50, planned to run Twitter as a private company for just three years before taking the company public, Elon Musk followed up with his puzzled thoughts on the social media site.
First tweet: “Ultimately the downfall of Freemasons was to give away their stonemasonry services for nothing.”
This was followed by a tweet that read, “Twitter will still be free for casual users, but maybe a small cost for commercial/government users.”
The ability to charge commercial or government users is the latest suggested change to the social media app that Musk has publicly considered.
Before striking a deal, Musk suggested lowering the price of the premium subscription service Twitter Blue.
Musk also tweeted about the potentially monetizing tweets, though he didn’t provide specific details.
On April 25, Musk reached an agreement with Twitter’s board to buy the company for $44 billion.
The South African-born billionaire said he was primarily motivated by a desire to restore Twitter as a place for the free exchange of ideas, and repeatedly said he wanted to move away from ‘censorship’ and prioritizing freedom of expression.
Critics fear this will lead to an explosion of hate speech.
Musk, who calls himself a free speech absolutist, criticized Twitter’s moderation policies.
He wants Twitter’s algorithm for prioritizing tweets to be public and opposes giving too much power over the service to companies that advertise.
At the Met Gala on Monday – his first public appearance since the deal was struck – he was asked about his plans for Twitter.
“My goal, assuming everything gets done, is to make Twitter as inclusive as possible and to have as wide a range of people on Twitter as possible,” he said.
“And that it’s fun and fun and that they have as much fun as possible.”
On Tuesday, Elon Musk tweeted: Twitter will still be free for casual users, but maybe a small cost for commercial/government users.
The Twitter logo is seen on November 7, 2013, outside the New York Stock Exchange on the first day of trading. Shares closed at $44.90 on day one. They are now worth $48.87
Since the deal, he has spoken to investors in a bid to cut the $21 billion he needs to complete the deal.
The rest of the money will come from bank loans.
Musk, the world’s richest man, is worth $255 billion – but much of that money is tied to Tesla stock. He is believed to have “only” $3 billion in cash, Bloomberg reported last month.
Musk’s indication that he is considering a plan to return the company to public ownership may be designed to reassure potential investors that he would act quickly to make the company profitable.
Private equity firms often take companies private, with the intention of increasing profitability and ironing out issues outside the spotlight, then going public within about five years.
On April 14, he said he was not interested in the business for money and was more concerned about changing the way it operated.
“It’s not some kind of way to make money,” he said. “I don’t care about the economy at all.”
Last week, Musk revealed he had sold $8.5 billion worth of Tesla stock following his deal to buy Twitter.
The new funding, which could be in the form of preferred or common stock, could reduce the $21 billion cash contribution Musk committed to the deal as well as a margin loan he secured on its Tesla shares, sources told Reuters.
Banks that agreed last month to provide $13 billion in loans based on Twitter’s business have been reluctant to offer more debt for Musk’s acquisition given the San Francisco-based company’s tight cash flow. Reuters reported last month.
Musk also pledged some of his Tesla shares to banks to arrange a $12.5 billion margin loan to help fund the deal.
Investors are wondering if Musk will complete the Twitter deal given he has backtracked in the past.
In April, he decided at the last minute not to serve on Twitter’s board.
In 2018, Musk tweeted that there was “secured funding” for a $72 billion deal to take Tesla private, but didn’t offer a bid.
Musk has already floated some ideas on how to make Twitter more profitable.
He said he intends to cut pay for executives and board members — Twitter’s 11 board members collectively earn $2.9 million in cash and stock, and Musk said he would reduce that amount to zero.
Twitter’s top lawyer, Vijaya Gadde, earned $17 million last year, though the vast majority of that was in stocks. CEO Parag Agrawal receives an annual salary of $1 million, but earned around $30 million last year when his action was counted.
Tesla tycoon, 50, agreed to pay shareholders $54.20 cash for each common share before bombshell deal closed
Twitter CEO Parag Agrawal (left) and co-founder Jack Dorsey (right) also sit on the board
Twitter board members received an average of nearly $290,000 in director compensation for 2021, according to filings — a figure not considered excessive in Silicon Valley.
Board members of Alphabet – Google’s parent company – earned between $400,000 and $500,000, while those on the board of Meta, Facebook’s parent company, earned on average close to $500,000. $800,000 in total compensation.
Twitter shares ended Tuesday up 0.55% at $48.87 in New York.
Musk would have to pay Twitter a $1 billion termination fee if he walks away, and the social media company could also sue him to complete the deal.