To Kill a Twitterbird
Published: May 5, 2022
“Good boards don’t create good companies, but a bad board can kill a good company every time.” - Ancient Silicon Valley Proverb
Startup Days
Once upon a time, 100 dedicated people crammed onto the 6th floor of 795 Folsom St. The vibe was hip and welcoming. Employees were focused, dedicated, and hardworking – One of the greatest startup atmospheres of all-time.
I fully understood, and appreciated, the surrealness of every moment. I was in a special place during a unique moment in time.
We planned to positively impact the world, one Tweet at a time. Honestly, we did. Beyond the work, a proud corporate culture emerged. Employees were transparent, gritty and (mostly) well-intentioned. We experienced our fair share of changes across top-level management; re-organizations and product changes.
Free Speech Culture
My focus was protecting Twitters Users. Spam and Abuse was an issue for the platform. Within two years, my focus was to give all users, especially the most vulnerable, a voice in a rapidly-changing online world. I was neither special nor alone. We all shared this vision. We had the support and vision of an amazing General Counsel. Governments were livid with us; we provided common citizens a unique opportunity to carry a strong voice – Twitter was (and remains) blocked in several Countries as a direct result of our stances on free speech.
Our free speech position is well documented!
Let me pause to issue a caveat: Not all speech was protected; nor should it be. From the early days, Twitter knew a small minority sought to co-opt our free speech views in hopes to advance their own nefarious purposes – they faced account suspension. Over time, we developed and enforced policies to reflect modern internet issues - against bullying, harassment, doxxing and exposing private information, hate speech, and so forth. New policies and visible updates to the Terms of Service ("TOS") is a forever area of interest. This warrants a larger discussion for another day.
Our free speech position was neither easy nor popular. Twitter was still in a rapid-growth stage. Whenever we were blocked, company folks (mostly engineers / sales) were unhappy and wondered why we couldn't just delete users' Tweets. It takes guts to potentially lose millions of users so that a few citizens can speak freely. Today, many now understand the value in what we considered, 'Good Trouble'.
In those days, our primary concern was external actors (Governments) who might negatively impact us. We never worried about internal actors, certainly not the Board of Directors (“Board”), impacting our daily work or making detrimental decisions about the trajectory of the company. We were fortunate to enjoy those easier times.
Twitter For Sale
Fast forward to April 5, 2022 – Twitter’s new CEO announced Elon Musk was seeking a seat on Twitter’s Board. From my unique history at Twitter and stock trading skill set, I uniquely understood this was bad news. Musk’s stunts with breaking securities laws and censorship are well documented. Within 45 minutes, I issued an all-in response: Beware of Musk. This was bad news dressed up for PR/headlines. It's safe to say my 🚩red flags🚩 immediately went up.
Musk had initally purchased a 9.1% stake in the company as an activist investor, with hopes to change company products and policies. He used “free speech” as his trojan horse. Days later, Musk rescinded interest to join Twitter’s Board. He now proposed a new offer: purchase the entire company for $44 Billion.
Openly, I wished the deal would fail, fast. On the surface, it might sound cool – world’s richest person wants to pay a large percentage of his personal fortune to acquire our once small startup. Nope. It’s really not cool; like at all.
One week later, in what may eventually be one of the most infamous corporate decisions of all-time, Twitter’s Board agreed to sell Twitter to Musk..
The Musk in the Room
Musk is free to spend his money however he chooses. This is, after all, America. He can empty his bank account to crown himself Twitter Lord or Chief Twit, etc. It seems extremely unwise to divert his energy and focus away from SpaceX and Tesla, where there are clearly no shortage of issues to fix but the choice, ultimately, is up to him.
If/When Musk purchases Twitter, he will indeed be severely disappointed. His buyer’s remorse will emerge quickly. Expect he will take the company private, get frustrated, tarnish the product and company, then once sufficiently bored — look to sell the company. This could take between 5-25 years.
Bigger Picture Problems
Elon Musk’s offer to buy and own Twitter for $44 Billion is alarming, on several levels.
First, the price is low. Twelve months ago, Twitter's market cap was nearly $70 Billion. Considering Microsoft recently purchased Activision Blizzard for $68.7 Billion, a mere $44 Billion for Twitter seems like a fire sale discount. Second, the ease in which one man hopes to acquire a relevant, vibrant, cultural cornerstone like Twitter is troublesome. We're not talking about some forgotten regional newpaper with declining readership. Twitter is / was where world leaders and citizens can communicate, strangers form bonds, professional athletes even announce their retirement on Twitter. Twitter is truly the closest humanity has come to real-time, global consciousness. Third, Musk’s offer highlights the epidemic of overleveraged financing deals, not too dissimilar from those which caused the 2007-2008 Financial Crisis.
Finally, Musk's history with censorship and legal issues hints at a multitude of potential problems up ahead for Twitter with Musk at the helm. If Twitter has to be in the hands of one single person, then it at least deserves someone more mature, sophisticated, ethical and moral.
Selling out was always an option for Twitter. Prior corporate governance at Twitter was always hip enough to decline. This ensemble of Board members, however, arguably failed its fiduciary duties and proved to be culturally tonedeaf. It remained my view that the best possible outcome for Twitter was for the deal to fail, fast.
What Happens Next
The deal must become finalized — It likely will. Musk will need to secure tens of billions of dollars AND survive lawsuits from shareholders who will inevitably seek to block the deal.
Financing will be full of thorns. Musk must sell billions worth of Tesla shares which nearly guarantees he accumulates additional debt and loses additional ownership of his other company. Other monies via debt will come forth from problematic sources; specifically, persons and institutions with a history of censorship, including the Qatar fund and authoritarian government regimes. Debt from traditional Wall St. banks will also be inevitable, which Twitter founder and former CEO Jack Dorsey cited as a dominant complaint about Twitter — Wall Street ownership means regression to the traditional ad model.Inside the walls of Twitter, swaths of employees will resign and those who stay will resent Musk. The brain drain will be substantial. Decades worth of institutional knowledge will be forever lost. Twitter employees are some of the brightest in the tech world. So expect them to flee the nest as they accept higher salaries and substantially less toxic work environments elsewhere. Good for them!
Outside the walls of Twitter, Musk is on pace to cause real-world damage to millions of Twitter Users. These include protected persons, journalists, critics, whistleblowers, dissidents, refugees, researchers and citizens around the world. The bullying behavior shown on Musk's personal Twitter account toward specific employees confirms his misunderstanding of both community guidelines AND acceptable online behavior. This sets into motion a regression in internet communication behavior. Expect the ripple effects to be nasty. Musk's handling of content moderation and data privacy will draw the ire of Government. Expect regulators to swoop in. This could have devastating, long-lasting consequences throughout the tech industry.
I hope I turn out to be so very wrong. It's a possibility; albeit a miniscule probability that under Musk's helm, Twitter's valuation soars past Facebook and TikTok, he solves spam and/or ends foreign government propaganda campaigns. My mind is open to being wrong. However, I will not hold my breath. In all honestly, time will tell.
Beyond Twitter
As Musk begins to deteriorate Twitter, one can expect the internet to search for Twitter alternatives. Mastodon, TikTok, and Signal will continue to rise in popularity. Former Tweeps might create Twitter alternatives. Others, like Jack Dorsey, will continue work to decentralize the very concept of Tweets. Nobody owns email, yet we all use it. Tweets need not be too different. Jack Dorsey's work on ATProtocol gets us close(r). However, this might be more like an API and thus complimentary to Twitter rather than being a viable alternative.
It's no accident that the majority of my expression is done on a personal website. In other words, there is a wager to be made that the future of communications is not held by corporate platforms but rather rests with the creator of the expression.
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I previously wrote about (allowing) organic failure and conservative social networks in The Curious Case to Restore Parler and Some Truth About Truth Social.