- As he was looking to buy Twitter, Elon Musk texted with tech executives including ex-Twitter CEO Jack Dorsey, Oracle's Larry Ellison and venture investor Joe Lonsdale.
- Some of his friends offered advice, while others expressed interest in investing.
- Musk has since tried to back out of his agreement to buy Twitter for $44 billion.
When Tesla CEO Elon Musk began accumulating shares in Twitter earlier this year, and later made a bid to buy the company, a number of luminaries from the tech and media worlds texted him with ideas, advice and offers of money.
Musk has since tried to back out of his $44 billion acquisition offer, and Twitter is suing to force him to go through with it. The case is progressing through the Delaware Chancery Court, and on Thursday some of these text messages were published as evidence.
related investing news
Here's a rundown of the most interesting and eye-opening exchanges:
Joe Lonsdale, tech investor, March 24: I love your 'Twitter algorithm should be open source' tweet -- I'm actually speaking to over 100 members of congress tomorrow at the GOP policy retreat and this is one of the ideas I'm pushing in for reigning in big tech. Now I can cite you so I'll sound less crazy myself ;) Our public squares need to not have arbitrary sketchy censorship"
On Apr. 4, when it was revealed Musk had taken a 9.2% stake in the company, Lonsdale followed up: Excited to see the stake in Twitter - awesome. "Back door man" they are saying haha. Hope you're able to influence it. I bet you the board doesn't even get full reporting or see any report of the censorship decisions and the little cabals going on there, but they should - the lefties on the board likely want plausible deniability!
He followed up again on Apr. 16: Haha even Governor DeSantis just called me now with ideas how to help you and outraged at that board and saying the public is rooting for you. let me know if you or somebody on your side wants to chat w him.
Twitter co-founder and former CEO Jack Dorsey responded to the same tweet on March 24: Yes, a new platform is needed. It can't be a company. This is why I left.
Elon Musk: Ok
Musk: What should it look like?
Dorsey: I believe it must be an open source protocol, funded by a foundation of sorts that doesn't own the protocol, only advances it. A bit like what Signal has done. It can't have an advertising model. Otherwise you have surface area that governments and advertisers will try to influence and control. If it has a centralized entity behind it, it will be attacked. This isn't complicated work, it just has to be done right so it's resilient to what has happened to twitter.
Will MacAskill, Oxford philosophy professor, March 29: Hey - I saw your poll on twitter about Twitter and free speech. I'm not sure if this is what's on your mind, but my collaborator [crypto investor and FTX CEO] Sam Bankman-Fried has for a while been potentially interested in purchasing it and then making it better for the world. If you want to talk to him about a possible joint effort in that direction, his number is [redacted] and he's on Signal.
Musk: Does he have huge amounts of money?
MacAskill, March 30: Depends on how you define "huge"! He's worth $24B, and his early employees (with shared values) bump that to $30B. I asked about how much he could in principle contribute and he said "~$1-3B would be easy `$3-8b I could do ~8-15b is maybe possible but would require financing.
Bankman-Fried and Musk later communicated directly but the texts are mostly about meeting logistics. Later, other messages suggest Bankman-Fried was willing to put up as much as $5 billion to help finance Musk's takeover.
Mathias Dopfner, CEO, Axel Springer, March 30: Why don't you buy Twitter? We run it for you. And establish a true platform of free speech. Would be a real contribution to democracy.
Musk: Interesting idea.
Dopfner: I'm serious. It's doable. Will be fun.
On Apr. 6, Dopfner follwed up with more detailed ideas for the platform:
#Status Quo: it is the de facto public town square, but it is a problem that it does not adhere to free speech principles. --> so the core product is pretty good but (i) it does not serve democracy and (ii) the current business model is a dead end as reflected by flat share price.
#Goal: Make Twitter the global backbone of free speech, an open market place of ideas that truly complies with the spirit of the first amendment and shift the business model to a combination of ad-supported and paid to support quality
1.) "Solve Free Speech"
1a) Step 1: Make it censorship-FREE by radically reducing Terms of Services (now hundreds of pages) to the following: Twitter users agree to (1) use our service to send spam or scam users (2) Promote violence (3) Post illegal pornography
1b) Step 2: Make Twitter censorship-RESISTANT
- Ensure censorship resistance by implementing measures that warrant that Twitter can't be censored long term, regardless of which government and management.
- How? Keep pushing projects at Twitter that have been working on developing a decentralized social network protocol (e.g., BlueSky) It's not easy but the backend must run on decentralized infrastructure, APIs should become open (back to the roots! Twitter started and became big with open APIs).
- Twitter would be one of many clients to post and consume content.
- Then create a marketplace for algorithms, e.g., if you're a snowflake and don't want content that offends you pick another algorithm.
2.) "Solve Share Price"
Current state of the business:
- Twitter's ad revenues grow steadily and for the time being, are sufficient to fund operations.
- MAUs are flat, no structural growth
- Share price is flat, no confidence in the existing business model and/or
The message is cut off in the evidentiary documents at that point. No response from Musk is noted.
The next set of texts were sent by a person whose name has been redacted, or is unknown because it appears only as a phone number, on Apr. 4. No response from Musk is noted.
Unknown sender, Apr. 4: Congratulations!! The above article was laying out some of the things that might happen. Step 1: Blame the platform for its users Step 2: Coordinated pressure campaign Step 3: Exodus of the Bluechecks Step 4: Deplatforming "But it will not be easy. It will be a war. Let the battle begin."
It will be a delicate game of letting right wingers back on Twitter and how to navigate that (especially the boss himself, if you're up for that) I would also lay out the has a savvy cultural/political view be the VP of actual enforcement
A Blake Masters type
Joe Rogan, podcast host, Apr. 4: Are you going to liberate Twitter from the censorship happy mob?
Musk: I will provide advice, which they may or may not choose to follow
Elon texted his brother Kimbal Musk, an entrepreneur and Tesla board member, on Apr. 9: I have an idea for a blockchain social media system that does both payments and short text messages/links like twitter. You have to pay a tiny amount to register your message on the chain, which will cut out the vast majority of spam and bots. There is no throat to choke, so free speech is guaranteed.
The second piece of the puzzle is a massive real-time database that keeps a copy of all blockchain messages in memory, as well as all message sent to or received by you, your followers and those you follow.
Third piece is a twitter-like app on your phone that accessed the database in the cloud.
This could be massive
Kimbal Musk: I'd love to learn more. I've dug deep on Web3 (not crypto as much) and the voting powers are amazing and verified. Lots you could do here for this as well
Would have to pay w a token associated with the service? You'd have to hold the token in your wallet to post. Doesn't have to be expensive, it will grow over time in value
Blockchain prevents people from deleting tweets. Pros and cons but let the games begin!
If you did use your own token, you would not needs advertising it's a pay for use service but at a very low price
With scale it will be a huge business purely for the benefit of the users. I hate advertisements
There are some good ads out there. The voting component of interested users (only vote if you want to) could vote on ads that add value. The advertisers would have to stake a much larger amount of tokens, but other than that there is no charge for the ads. It will bring out the creatives and the ads can be politically incorrect/art/activision/philanthropy
Voting rights could also crowdsource kicking scammers out. It drives me crazy when I see people promoting the scam that you're giving away Bitcoin. Lots of bad people out there
On Apr. 20, Musk texted Larry Ellison, the Oracle co-founder and former Tesla board member: Any interest in participating in the Twitter deal?
Ellison: Yes...of course.
Musk: Roughly what dollar size? Not holding you to anything, but the deal is oversubscribed, so I have to reduce or kick out some participants.
Ellison: A billion...or whatever you recommend
Musk: Whatever works for you. I'd recommend maybe $2B or more. This has very high potential and I'd rather have you than anyone else.
Ellison: I agree that it has huge potential...and it would be a lot of fun
Other notes of interest:
- Musk asked LinkedIn founder and investor Reid Hoffman if he wanted to take part in the take-private buyout.
- Hoffman put Musk in touch with Microsoft CEO Satya Nadella, who apparently had a phone call with Musk. After the call, Nadella noted that he would "follow-up on Teams feedback!"
- Investor David Sacks offered to participate through a special-purpose vehicle.
- Musk had many exchanges with investor Jason Calacanis, including one in which Musk criticizes Calacanis for "marketing a SPV to randos," saying it makes Musk seem "desperate." Calacanis later explains that he's just trying to support Musk, "And you know I'm ride or die, brother -- I'd jump on a grande for you."