How Elon Musk and Jack Dorsey aligned behind Twitter deal

At a Twitter employee retreat in early 2020, Jack Dorsey, the company’s co-founder and then CEO, invited a celebrity guest to speak with his employees: Elon Musk.

The Tesla CEO video-complained with the audience about the proliferation of spam bots on the platform — the same issue he’s now using to shelve his $44 billion bid for the social media company.

Aside from Musk’s ongoing obsession with fake accounts, the appearance was also a testament to Dorsey and Musk’s close relationship, a multibillion-dollar “bromance” that has already dramatically rocked the future of Twitter.

The couple’s alliance has fueled speculation as to whether Dorsey could play a key role in the company if a deal is struck. But it’s also angered many Twitter employees, who see it as a betrayal of the social network that is faced with upheaval in the form of hiring freezes, austerity measures and a low work ethic, and whose employees have repeatedly been taunted by Musk.

Regulatory filings earlier this week indicated that after Musk was first invited to join Twitter’s board as a major shareholder in early April, Dorsey “shared his personal view that as a private company, Twitter could better focus on execution.” Dorsey resigned as Twitter CEO last November but remains on the board, which also includes Salesforce CEO Bret Taylor, tech entrepreneur Martha Lane Fox, and former Google chief financial officer Patrick Pichette.

According to people close to the situation, the advice resulted in part from growing tensions between Dorsey and other Twitter executives over how the company should be run and over issues like content moderation.

In the past, he had notably clashed with the activist fund Elliott Management, which previously held a seat on Twitter’s board of directors. According to several people, Dorsey thought the fund was too commercial and focused on the short-term view. Some board members, meanwhile, grew increasingly frustrated with what they perceived as a lack of commitment from Dorsey.

Just a week after Dorsey said Twitter would be better off taking it private, Musk announced his plans to do just that. When the board approved the acquisition, Dorsey tweeted, “Elon is the unique solution I trust. I trust its mission to expand the light of consciousness.”

“Jack’s philosophy was to negotiate a peace settlement with Elliott and then take the company private so these people could never again incentivize a product that was so important to society,” said a person close to him.

Dorsey maintained a professional relationship with the board members, but felt personally challenged by Elliott, who took a board seat at Twitter after investing in the company in early 2020, according to several people familiar with the meetings.

Concerned at the time that Dorsey was distracted from his second position as chief executive at payments company Square, Elliott called for a faster pace of product innovation. Dorsey embraced terms like decentralization and blockchain technology and dismissed Elliott as too capitalist.

During the deal process, Musk publicly blamed the board for some of its content moderation decisions, as well as the number of fake accounts on the site. Dorsey has joined him in criticizing Twitter’s board of directors, tweeting in April that this has been “the company’s dysfunction throughout”.

Those comments can be attributed to Dorsey’s growing disdain for Wall Street and US politics, which those close to him say goes back several years.

Dorsey became disillusioned after several congressional hearings where he was asked to testify about content moderation issues and began to believe the company was being used as a political pawn, one person said.

At the same time, the board put more pressure on Dorsey to discuss and address big content moderation issues — like former US President Donald Trump’s ban — which he was reluctant to do, people familiar with the matter said.

After the board asked Dorsey to devote himself full-time to running Twitter following the Jan. 6, 2018 attack on the US Capitol, he declined and eventually resigned from his position as chief executive, two people said.

These tensions did not manifest themselves in rows or raised voices. According to those familiar with the situation, Dorsey remained emotionless and passive during board meetings, which irritated the more aggressive, highly engaged figures in the room – although he has become more harsh on the board in recent negotiations on the deal.

Twitter declined to comment. Square, now known as Block, and Elliott Management did not immediately respond to requests for comment.

During Dorsey said recently He would never return to the company as CEO. He has spoken to Musk about whether he can continue to “hold the equity of the surviving company or one or more of its post-merger subsidiaries,” according to Twitter’s regulatory filings.

Outside of their shared interest in Twitter, the two entrepreneurs have found common ground on topics such as cryptocurrencies, open source technology and freedom of expression. Both have been successful as Silicon Valley founders who have run multiple companies simultaneously.

“Jack was obviously ‘Team Elon’ from day one,” said Stefano Bonini, corporate governance expert at Stevens Institute of Technology.

The developments have unsettled many employees within Twitter, according to three employees and former executives. Files showed the two were closer than staff initially thought, one person said.

Some employees believe that Dorsey, once an internally revered guru-like figure, is rewriting the company’s history by publicly criticizing content moderation decisions made during his tenure as CEO and new CEO Parag Agrawal who he is, unsupported played a big part in hiring.

Many are upset that he didn’t defend Twitter’s political and legal chief Vijaya Gadde when Musk started doing it just days after the deal was agreed Post criticism publicly of her moderating decisions, including blocking a news article about US President Joe Biden’s son Hunter. This caused Gadde to receive a barrage of harassment and racial slurs.

Still, some question the sincerity of the relationship. “Jack genuinely believes privatizing the company is the right thing to do. And if there’s a way to do it, and do it quickly, it’s worth it,” said a person close to him. “[But] these relationships are provisional. They are built on men who will protect their legacy.”

How Elon Musk and Jack Dorsey aligned behind Twitter deal Source link How Elon Musk and Jack Dorsey aligned behind Twitter deal

Related Articles

Back to top button