Elon Musk says Twitter deal is on hold, putting supply on shaky ground
With around 229 million daily active users, Twitter is much smaller than competing social networks, such as Facebook and TikTok, which are used by billions. Cifras. La company has been criticized for its slow growth and has been paralyzed because its advertising profits are below its peers.
Musk, however, is seen by many Silicon Valley investors as a potential savior: a change specialist with record execution, who will have a non-public interest in Twitter’s success. prolific users, who post several times a day. He uses the service to relay updates about his businesses to his legions of enthusiasts and followers, make jokes and percentages of memes, and telegraph non-public interests and political opinions.
Now, Musk has presented potential investors with an ambitious plan to unlock 3 to 4 times the same previous Twitter profits, which typically come from advertising, through competitive efforts to monetize the platform, according to projections shared among investors and notified through the Washington Post.
The pitch deck shared with potential investors through Stonks’ projects that a Musk-owned Twitter would earn $16. 8 billion in advertising in the fifth year. Twitter’s profits topped $5 billion last year.
While Musk doesn’t delight in running an advertising-dependent business, investors say his track record shows he has the ability to unlock unthinkable amounts of prices in the past with his businesses, primarily Tesla, which has gone from being a niche startup to the world’s highest. valuable automaker in just over a decade of car delivery.
Still, other people said, this means investors are applying the same logic to the social media giant that is usually reserved for startups, when profit and loss projections aren’t as vital as the company’s vision and the background and personality of those behind it.
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Musk framed his resolve to win Twitter in ideological terms. Like many marketers who have made their fortune in Silicon Valley over the past 20 years, Musk says he’s concerned about the public discourse that big corporations like Facebook, Google and Twitter have. He called Twitter’s resolution banning Donald Trump a mistake and vowed to oppose it.
Ellison, who made his fortune by co-founding database generation company Oracle, is a staunch Trump supporter. One user working with Ellison, who spoke on condition of anonymity to describe users’ conversations, said Ellison wouldn’t spend a billion dollars if he didn’t. I think it can make a comeback.
“No matter what you think of Elon, he’s an original philosopher Larry likes,” the person said, adding that he has no express knowledge of the deal. “When it comes to the advertising side, Twitter is underrated. “
Meanwhile, venture capital firm Andreessen Horowitz has invested in new corporations and cryptocurrency technologies in which “creators” deliver content directly to consumers, bypassing gatekeepers as classic publishers. The company’s co-founder, Marc Andreessen, has openly criticized online censorship. (Andreessen is a board member of rival Facebook, which could create some other conflict with his company’s stake in Twitter. )
Twitter is horny in part because of its price as a megaphone. “He’s buying the marketing decomposer,” said a user familiar with the investors involved in the deal, speaking on condition of anonymity so as not to alienate his friends. This motivation may simply be especially vital for those investing in cryptocurrencies, the user said.
Andreessen declined to comment.
The global managing spouse of venture capital firm Sequoia, Doug Leone, was also a prominent best friend of Trump’s, but broke with the former president in the Jan. 6, 2021, attack on the Capitol, according to his public statements. Several of Sequoia’s spouses, with other political views, have committed budget to make Twitter private, according to a user familiar with the organization’s strategy who spoke on condition of anonymity to describe confidential issues.
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Sequoia also led the first funding of X. com, an online bank co-founded through Musk in 1999. Sequoia also invested in SpaceX and Musk’s Boring, a tunneling company.
“For more than two decades, we have been at the forefront of Elon’s technical and advertising prowess,” Sequoia spokeswoman Natalie Miyake said in a statement. Twitter’s perspective as a global platform connecting the world. “
Saudi Prince Alwaleed bin Talal al Saud and Chinese crypto company Binance are included in the investment round.
Some of the foreign donors have attracted the interest of the U. S. government. USA The U. S. Foreign Investment Committee, known as CFIUS, questioned those involved in the foreign investor merger deal Musk submitted in his bid because of potential national security concerns, according to a report. A user briefed on the investigation, who spoke on condition of anonymity due to the sensitive nature of the conversations.
Alwaleed and Binance responded to requests for comment.
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According to Stonks’ pitch deck, Musk aims to reduce “the number of employees and prices in an inflated organization,” grow the advertising business, and introduce and focus on spaces like subscriptions, payments, and monetize the author’s economy. The pitch deck also called for caution, highlighting the volatility of the deal.
“Nothing is certain. . . you can still lose everything if you make YOLO on this investment,” the slideshow reads, a reference to the saying “we live once. “
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It’s relatively seeing what some in Silicon Valley describe as core investment, where corporations like Stonks are looking for smaller investors to pool the budget to subscribe to the offering. Some investors position the momentum in terms of “cult of Elon”,where interest in his business is materialized by the preference for closeness to him and his provenance.
Jason Calcanis, a friend of Musk’s and a Silicon Valley investor, solicited donations from venture capitalists to invest in Twitter. The Post showed the main points of this effort, which reaches a minimum investment of $ 250,000 with a valuation of $ 44 billion, with investor prospects
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This may have been born out of necessity, some investors said, suggesting it may also mean Musk is struggling to find enough overall funding.
If the total number of investors in the deal reaches 2000, then Twitter will be asked to disclose its monetary knowledge to the SEC, it remains private.
“Whether you think it’s a smart deal or not, you’re just as committed as other people to an acquisition like this and it’s a step in the right direction for personal market transactions that are usually made to ordinary investors,” Hardej said. Said.
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