(Liberty Bell) – If you listen closely, you can hear the knees of Twitter employees knocking together in sheer terror as they await billionaire Elon Musk taking over the social media platform he recently purchased for $44 million, wondering day and night what kind of changes he will be making to the company.
However, while they might be shaking in their boots at the thought of the company culture and practices changing under the leadership of Musk, they really should be more worried about losing their jobs as he considers making some serious cuts to reduce the cost of doing business.
According to The Western Journal, Musk has made a number of statements about allowing more speech on the social media platform and making its algorithms open source as a means of increasing trust among users.
“Free speech is the bedrock of a functioning democracy, and Twitter is the digital town square where matters vital to the future of humanity are debated,” Musk went on to say in a statement on April 25, which was just after his deal to buy the company was announced.
“I also want to make Twitter better than ever by enhancing the product with new features, making the algorithms open source to increase trust, defeating the spam bots, and authenticating all humans,” he said.
However, not everyone is thrilled to pieces about the upcoming moves that Musk has in mind.
“Many Twitter employees feel personally invested in the company’s effort to encourage healthy conversation — even if they do not directly work on content moderation — and have pressed executives to crack down further on hate speech and misinformation, six employees said. They see Mr. Musk’s proposal to revert to Twitter’s early, lax approach as a rebuke of their work,” The New York Times stated in a report last month.
But if those folks think that whining and complaining or even quitting will somehow stop Musk, they might want to rethink their strategy.
While Musk seems serious about wanting to change public discourse through the social media platform, he’s also running a multimillion dollar company, thus, having cranky employees jump ship is not really a big concern of his.
The main concern for Musk right now that he owns the company is making sure it makes money and to keep the share value of the company on the up and up.
“When putting together the financing for the $44 billion deal to buy the social media giant, the Tesla and SpaceX CEO pledged to slash jobs and executive pay in order to cut operating costs at Twitter, Bloomberg reported,” the WJ said. “He has to cut costs where he can because he secured the money for the deal through loans and debt financing.”
“To push through the deal, Musk got $13 billion in loans secured against Twitter and a $12.5 billion margin loan tied to his Tesla stock. The remainder of the $44 billion he paid with his own money, Reuters reported,” the WJ reported.
“To secure that kind of financing, he had to convince banks that he would slash costs at the social media company and make it more profitable,” the report continued. “As the deal is currently underway, it won’t be long until Musk will have to start paying on those loans.”
If Twitter employees decide to leave due to the company’s new owner, they will soon discover they are totally replaceable.
“He’s going to have some very big monthly debt payments to make on this little thing that he just bought called Twitter,” Aron Solomon, the head of strategy and chief legal analyst for Esquire Digital, stated during an interview with The Western Journal. “He can’t afford to dramatically jeopardize its stock value.”
“Does that mean that he can’t afford to alienate Twitter employees and have them leave and be replaced by other people? Of course he can,” Solomon continued.
“So people who are saying, ‘Oh my gosh, if people leave Twitter, that’s going to affect the share value.’ No it won’t,” Solomon added.
So the principles of free speech, while being something that Musk holds to be important, aren’t the only thing on his mind. He wants to make a profit as well.
“Even before the deal went through, he was announcing ideas he had to save money operating Twitter — including cutting board members’ salaries completely,” the WJ said in their report.
Board salary will be $0 if my bid succeeds, so that’s ~$3M/year saved right there
— Elon Musk (@elonmusk) April 18, 2022
Another way that Musk could save a little change would be to cut the multi million-dollar compensation of some Twitter executives.
Parag Agrawal, the current Twitter CEO, for example, ended up making $30 million last year, according to a report put out by Forbes.
When you look at a lot of other CEOs working for Big Tech companies, Agrawal’s is very large.
Snap CEO Evan Spiegel made roughly $3.3 million in total compensation for 2021. Sundar Pichai, CEO of Google parent company Alphabet, made about $6.3 million. Facebook co-founder and Meta CEO Mark Zuckerberg made about $27 million in total compensation last year,” the report stated.
Musk is also set to seek ways to increase the stock value of Twitter.
“What Elon Musk is banking on is at least one or two spikes in share value that can then be maintained at a higher plateau than the Twitter public board has been able to do over the past decade,” Solomon commented.
This is one of the reasons for Musk taking the now publicly traded company and making it private.
Musk stated in his letter announcing his offer that the company needed to go private “to go through the changes that need to be made.”
“After a few years of making the necessary changes to boost Twitter, Musk could return the social media company to public ownership once again, he told investors, according to The Wall Street Journal,” the report continued.
The report then said that Musk might stage an initial public offering of the company in three years.
The bottom line is, if the whiners think boohooing is going to change up the plans Musk has for Twitter, they are dead wrong. In fact, they should probably just start looking for new jobs.
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