Twitter acquisition seems like a bad move for Musk
From a financial standpoint, the amount of debt he had to take on to fund the acquisition is pretty massive, and I can’t imagine him being able to make sweeping operational changes in short order to boost revenue. There may even be advertisers less willing to place ads on Twitter because of the perceived outrage this has caused amongst their consumer base (which, to me, is silly. Everyone’s being so dramatic about this shit lol).
He’s already heavily focused on Tesla & SpaceX, so I’m not sure where he’ll find the bandwidth to turn things around, if that is in fact his desire. If he has to conduct massive layoffs to backfill those positions with those who better align with his cultural ambitions— good luck with that. I mean, sure, the likes of Meta are undergoing hiring freezes but it’s not as if there’s a glut of tech talent— most companies are falling over one another to hire top talent.
But back to the financial aspect: Twitter will have about $1bn in interest payments due annually after this buyout, while it’s cash flows are projected to be $1.4bn this year, so they’re going to be cash-strapped. And if your argument is he’s doing this for lolz and shits and giggles, then it’s a *really* bad move and a really expensive one at that.
Frankly, I think Parag is the winner in this one if he gets a sweet $42M payout upon being fired. Guy can live it up and not have to worry about achieving 325M DAUs by the end of 2023, among many other tall orders.
What am I missing?
TC: $285k
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He shouldn’t have bought Twitter and instead continued to focus his time on spacex and Tesla. Now the cesspool that Twitter is will eat up more than 30% of his time.