Elon Musk is now officially the “Chief Twit”, or at least that’s what his Twitter bio says. After months of back and forth, Elon Musk has completed the $44bn acquisition of Twitter, which will now operate as a private company. Elon wasted no time flexing his muscles, firing CEO Parag Agrawal; CFO Ned Segal; Vijaya Gadde Head of Legal Policy; General Counsel Sean Edgett (their combined termination payouts are set to be over $200 million), and Twitter’s Board of Directors. He has also said he would fire about 50% of Twitter’s current staff.
“The reason I acquired Twitter is because it is important to the future of civilization to have a common digital town square, where a wide range of beliefs can be debated in a healthy manner, without resorting to violence” – Elon Musk
Since he initiated the purchase in May, Elon has been touting himself as the free speech absolutist that believes that Twitter should be a place where everyone feels comfortable speaking freely no matter how unpopular their opinions are. He has also said he would lift the lifetime ban on Donald Trump, although Trump has said he will not return to the platform even if the ban is lifted.
Elon has said that he wants Twitter to become the number one platform for advertisers, but advertisers do not want to be displayed alongside inappropriate content. Elon will have to figure out a balance between making Twitter a free for all and advertiser-friendly.
Speaking of free for all, Elon is looking to charge $8 per month for the revered blue verification mark and a few other benefits. This has caused quite a stir as some verified users see it as diluting the value of the check mark, while others see it as a means to catch “broke” verified users.
Elon added that the price will be adjusted by country proportionate to purchasing power parity. So worry not, Nigerian users may not have to pay over N6,400 per month to be verified. Before the acquisition, Twitter charged $4.99 per month for Twitter blue which gives access to exclusive features such as an edit button. Do you think Twitter users can afford yet another subscription service?
Elon added that the price will be adjusted by country proportionate to purchasing power parity. So worry not, Nigerian users may not have to pay over N6,400 per month to be verified. Before the acquisition, Twitter charged $4.99 per month for Twitter blue which gives access to exclusive features such as an edit button.
Elon ultimately wants to turn Twitter into X, the everything app. X is a rip-off of China’s WeChat which allows users shop, make payments and subscriptions, send and receive messages and access entertainment on one app. Many critics don’t see Twitter achieving this goal because China has the laws that make a WeChat necessary (no Google Playstore in China and limited Apple App store). But the US doesn’t have such limitations. Do users need everything to happen on 1 app when they can have 5 or 10 instead? Also, would you be comfortable with sending money on Twitter?
Now That Twitter is a private company, what happens now ?
After Elon Musk completed his acquisition of Twitter for $54.20 per share (total of $44B). Shares of twitter were suspended from trading and were delisted from the exchanges. The company was also removed from the popular S&P500 index. In its place, the next company that meets the S&P500 listing criteria will immediately be added to the index. In this case, that company is Arch Capital Group, the largest private mortgage insurer in the US with a market cap of more than $20B. It’s been public since 1995. That means that everyone holding the S&P500 will automatically be owning shares of Arch Capital ($ACGL).