On Thursday an SEC filing was revealed that showed that approximately $7.14 billion was secured from friends and other investors to invest in equity commitment. It is expected that Elon Musk will serve as temporary CEO of Twitter once the $44 billion worth takeover of the company is completed. As revealed to CNBC’s David Faber, it is known that Musk handpicked the investors himself.
Some of the commitments from the investors also include Oracle co-founder Larry Ellison. The Oracle co-founder invested around $5 million from Honeycomb Asset Management. Twitter CEO Parag Agrawal has only led the company for a few months, after assuming the helm from Dorsey last November. Until now, there hadn’t been much discussion about whether Musk’s takeover of the company would lead to a leadership shake-up. Last month, Reuters reported Musk had lined up a new CEO for Twitter, citing a source familiar with the matter.
Agrawal told employees during a companywide town hall meeting last month that the future of Twitter is uncertain under Musk. “Once the deal closes, we don’t know which direction the platform will go,” Agrawal reportedly said when asked whether the company may allow former U.S. President Donald Trump to return to the platform when Musk takes over. Trump was permanently suspended from Twitter last year.
Musk’s acquisition of Twitter comes at a key time for the company. Agrawal has said he would focus on growing Twitter’s daily active user base and bringing new products to customers. In the company’s latest earnings report, Twitter said it hit 229 million monetizable daily active users, a 15.9% increase from the same period last year.
Musk, who is the CEO of Tesla and SpaceX, has recently led presentations in front of investors, where he gave financial projections based on his analysis of Twitter, according to sources familiar with the situation who spoke with Faber. Musk told investors that he felt Twitter’s earnings before interest, taxes, depreciation, and amortization margin were too low and the company has “too many engineers not doing enough,” Faber said, citing sources familiar. Musk also pledged to make the company a “magnet for talent,” Faber added.
While buying itself appears to be a challenge. The further would be fixing Twitter. It is already known how Musk wanted to add the edit button feature. Another aspect is that Musk said that Twitter will charge for commercial users and government users. While it does appear to be open to individual users who use the platform casually. There are many challenges underlying the moves Musk is looking forward to making.