Call me Chairman Musk. Tesla CEO becomes the sole director of Twitter after he dissolves its board of directors
Twitter’s new owner, Elon Musk, has begun his first week in charge of the microblogging platform with a number of immediate changes.
It has been reported that Musk intends to axe one-quarter of Twitter’s 2,000 strong workforce in a first round of layoffs.
This is down from the 75 percent of jobs he reportedly told investors he planned to cull, but still a quarter of job cuts suggests that close to 2,000 people at Twitter could soon lose their jobs.
And some of the jobs losses have already begun.
Just after he closed the deal late last Thursday, Musk fired a number of top Twitter executives, including CEO Parag Agrawal, CFO Ned Segal, and Vijaya Gadde, the head of legal policy, trust and safety.
Both Agrawal and Segal were reportedly still in Twitter’s San Francisco headquarters when the deal closed and the two men were escorted out of the building.
CNN reported that Agrawal, Segal, and Gadde would have received a large chunk of that money even if they had stayed on board under the new ownership.
Now it seems that they and other shareholders will receive payouts from Musk after he bought their shares for $54.20 each.
Agrawal, who only assumed the CEO title a little less than a year ago, had the smallest stock holdings of the three, CNN reported: namely 155,000 shares worth $8.4 million at the price Musk paid.
Segal is to get $22 million for the 406,000 shares he owns, while Gadde will walk away with $34.8 million for her 642,000 shares.
But they also receive “Golden Parachute Compensation” in the merger agreement approved by shareholders, CNN reported. That includes a year’s base pay – $1 million for Agrawal and $600,000 each for Segal and Gadde. They also will get a year of health insurance, worth about $73,000 among the three.
The most lucrative part by far is the accelerated vesting of stock they stood to receive in the future but had not yet qualified for, CNN reported.
That will end up being worth $56.4 million for Agrawal, $43.8 million for Segal and $19.4 million for Gadde.
Board of Directors
Another firing by Musk was Twitter’s entire board of directors, leaving him as the sole director of the platform, according to a filing on Monday.
“On October 27, 2022, and as a result of the consummation of the Merger, Mr. Musk became the sole director of Twitter,” the filing stated. “In accordance with the terms of the Merger Agreement, effective as of the effective time of the Merger, the following persons, who were directors of Twitter prior to the effective time of the Merger, are no longer directors of Twitter: Bret Taylor, Parag Agrawal, Omid Kordestani, David Rosenblatt, Martha Lane Fox, Patrick Pichette, Egon Durban, Fei-Fei Li and Mimi Alemayehou.”
Baroness Martha Lane Fox is currently president of the British Chambers of Commerce.
Elon Musk is currently the CEO of four firms, but now he has also confirmed in another filing that he is the CEO of Twitter, although this may not be a permanent role.
Elon Musk is already CEO of Tesla and SpaceX.
But he is also the defacto CEO of two other firms, namely brain-chip startup Neuralink and tunneling firm the Boring Company.
Blue tick fees?
Musk has previously confirmed the “blue check mark” verification scheme on Twitter is being revamped, following reports that the company could charge users (up to $20 per month) to be verified.
Musk responded to a tweet from author Stephen King that he would not be willing to pay $20 a month to keep the verified badge on Twitter.
$20 a month to keep my blue check? Fuck that, they should pay me. If that gets instituted, I’m gone like Enron.
— Stephen King (@StephenKing) October 31, 2022
Musk replied: “We need to pay the bills somehow! Twitter cannot rely entirely on advertisers. How about $8?”
King later replied to the usual Twitter trolling comments about his post. “It ain’t the money, it’s the principle of the thing.”
Elon Musk has a fine line to tread with Twitter, considering he is now in charge of its content moderation direction.
He has to satisfy advertisers that he will not completely relax the platform’s content moderation systems, despite touting himself as a “free-speech absolutist”.
In May this year Musk said he would reverse the morally wrong” and “stupid” permanent Twitter ban on former US president Donald Trump.
Trump has welcomed Musk’s takeover, saying the platform is now in “sane” hands.
Last week an internal report revealed Twitter is losing its most active users who are vital to the business.
These “heavy tweeters” account for less than 10 percent of monthly overall users but generate 90 percent of all tweets and half of global revenue.
This is not just cases of celebrities ghosting their own Twitter accounts, but rather heavy tweeters switching to rival platforms such as Meta’s Instagram and ByteDance’s TikTok,
Musk will need to ensure that he keeps these heavy tweeters (such as Stephen King) onboard and engaged.