Elon’s Eager Twitter Funders Are Losing Faith, As Stakes Are Effectively Worthless
from the setting-money-on-fire dept
Elon Musk’s Twitter takeover was supposed to be a slam dunk. It was famously revealed during his legal fight to get out of the deal that Elon was getting overwhelmed with people texting him, willing to casually offer hundreds of millions, or even billions of dollars, in support of his takeover. But some of them are deeply, deeply regretting doing so.
I just finished reading an advance copy of Character Limit: How Elon Musk Destroyed Twitter, which is coming out very soon. It’s a fascinating and really revealing book about everything that’s gone on with Elon and the site formerly known as Twitter. It goes into great detail, with lots of behind-the-scenes revelations, about what really went down with the purchase.
One thing that becomes clear in the book is that many of the investors who agreed to back Musk’s bid truly believed that Elon had the secret sauce necessary to revitalize Twitter. They were under the false impression that the (not at all accurate) mainstream narrative about Twitter’s old management being “too woke” and focused on “censoring conservatives” meant that Twitter would be easy to “fix.”
On the whole, lots of people legitimately seemed to think that Elon would sort things out, while some were more skeptical and just wanted closer access to Elon.
They all seemed to think that the worst-case scenario was that maybe it would be a rocky ride, with Musk eventually getting Twitter into shape so that they could get a decent return on their investment. Two years in, I don’t think many expected that their investment (often hundreds of millions of dollars) would be diminished by somewhere in the range of 75 to 85% of its value.
Every few months, there’s another report coming out about how Fidelity has to cut the value of Twitter shares to match the likely market value of the company. This is because Fidelity sprinkled Twitter shares into a whole bunch of its funds, though it did record a very tiny uptick last May. On the whole, though, Fidelity claims the investment has lost about 70% of its value.
The Washington Post recently went to talk with some of those investors, who had been so excited to get in on such a great deal. Many of them don’t seem so enthusiastic any more, including Ross Gerber, a long-time Musk booster who also had a decent stake in Tesla.
“Elon’s done a tremendous amount of wealth destruction since he’s purchased Twitter,” said Ross Gerber, who said he invested less than $1 million, a stake he now considers worthless.
“For the people who put capital into him for any amount,” Gerber said, “ … trying to explain to people how he lost” so much money “is not a fun conversation.”
The article has a quote from the Saudi Arabian fund, Kingdom Holding Co., who had initially been hesitant to back Musk, but then went all in (though they just rolled over an investment from over a decade ago, rather than putting in any new money). The quote is somewhat hilarious. Their initial investment years ago had been a few hundred million, but had ballooned to about $2 billion. And, according to Saudi Prince Alwaleed bin Talal, who seems to have missed out on his opportunity to be a propaganda minister, nothing has changed in the valuation:
“In our books, on my books personally, we are valuing at minimum [at] the entry level that we entered with,” he said last week. “There’s no devaluation whatsoever.”
He has to realize that not a single person on the planet believes him. Even Elon himself has said that the value of the company is less than half what he paid for it.
Still, Alwaleed is apparently betting on the next big grift: that because ExTwitter owns 25% of X.ai, Elon’s attempt to become a big AI company, the valuation is worth it. That… seems like a long shot. First of all, the AI market is already pretty saturated with big players that have much bigger warchests. Already we’re seeing some of the lesser providers effectively conceding and folding. X.ai is still wholly reliant on ExTwitter and its users, which seems likely to limit its growth opportunities as well.
Either way, I’m sure some investors are still happy enough to be involved because they think it will help them get access to future Elon boondoggles, some of which might actually make money somehow. But, for now, at least some of his investors are realizing that they were sold a bill of goods by a traveling monorail salesman.
Filed Under: alwaleed bin talal, elon musk, investors, ross gerber, saudi arabia, valuation, value
Companies: twitter, x
Comments on “Elon’s Eager Twitter Funders Are Losing Faith, As Stakes Are Effectively Worthless”
How twlling that most of his funders either shared a similar ideology to the resident Emerald Apartheid Space Karen, or were using him for their personal agendas.
I’m sure the Sauds are not too disappointed at what Elon has done to undermine criticism of the House of Saud and Saudi Arabia.
Re: Blatantly lying or saying the quiet part out loud
I’m sure the Sauds are not too disappointed at what Elon has done to undermine criticism of the House of Saud and Saudi Arabia.
Given how Elon’s tanked the platform’s worth to such a large extent barring them just flat out lying to save face I can’t imagine how else the claim that their investment is worth just as much today as it was when they made it could even begin to make sense.
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Value means different things to many people.
And I don’t think the Sauds cared about monetary value in the first place, though they’d prefer if Elon turned a profit in addition to the rest of the shit he’s done…
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And right there is the key. The Saudis don’t care at all about the $2B, even if they say they do. They care about the value of Twitter as a propaganda/disinformation engine.
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Easy
few hundred million, but had ballooned to about $2 billion
In their books, it was always a few hundred million. And 20% of 2 Billion is still a few hundred million.
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It’s practically nothing when you’re used to having infinite petrodollars.
The Sauds don’t care too much about the money, even if they would like to make a small profit off Elon’s bullshit management.
It’s more telling that these rich insurrectionist fucks banded together to destroy Twiter because they thought Elon would slowly infect Twitter with terminal cancer behind the scenes, like they did in many, many countries instead of a public AIDS injection.
The Sauds’ opinion on this is more telling.
'... Wait, how badly do things work out when they can't distract him again?'
I guess Elon’s investors, much like him, aren’t too keen on the whole ‘Investigate what you’re buying before you sign the deal’ thing.
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Excuse me, but you have no idea have no idea what Musk is thinking..
just shut up. I beg you.. please. You make no sense…
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Everything has a price.
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Wow! That’s over a 72% savings off of the daily option!
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On the one hand, we don’t know exactly what the spoiled Apartheid baby is thinking. On the other hand, the possibilities are limited to within a range of stupid-evil.
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Neither do Musk it seems, although we can largely infer from what he says and what he does what he is thinking.
Why? Aren’t people allowed to have opinions you don’t understand?
Have you tried remedial classes in English?
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Have you read his Twitter feed?
Don’t answer, we know you do.
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“Leave Britney alone!!”
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To be fair to Cara Cunningham, Britney was not doing anything bad to anyone. Leaving her alone was a reasonable request, even if it was framed in a slightly unreasonable way.
As long as Elmo won’t leave other people alone when they’re calling weird people weird or pointing out his cars are bad, why should we leave him alone?
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To be fair to AC, I think they were actually rewording Stan Harper from MA’s demand to demonstrate just how ridiculous it is (although asking people to not attack Britney Spears is not ridiculous).
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Have a pin.
https://www.etsy.com/listing/1301855253/elon-musk-weird-nerds-and-valid
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Elmo’s not gonna let you suck his peener bro.
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Do your fingers stutter?
This might blow your little mind, but observing what people do and say and using that info to deduce, often quite successfully, what they’re thinking is something humans have been doing for many thousands of years.
They should have invested in the tiny violins industry.
It always baffles me that people think being rich means you’re smart.
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Rich people aren’t intelligent per se—they’re just smart enough to know how to get rich and somehow stay rich. To wit: Donald Trump, who has proven himself to be a complete fucking moron over the past ten years and has leveraged his own business failures into somehow keeping him rich despite numerous bankruptcies (how the fuck do you fuck up running a casino?!) and helping him stay famous well past when his fifteen minutes of fame should’ve been up.
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Rarely. The vast majority of them are born rich. Musk and Trump very much included.
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It’s another result of simplistic thinking. Rich = smart. My team = good guys. People who don’t agree with me = stupid. Et cetera.
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It’s also in the rich’s best interest to convince everyone that they got what they have because they deserve it, and if only you work hard enough you’ll be rewarded too.
Like the line about how America doesn’t have any poor people, only temporarily embarrassed millionaires.
Or Fry’s line on Futurama about how “Someday I might be rich. And then people like me better watch their step.”
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It depends if a rich person was already born rich, or had to earn every buck. The former just needs to be as smart as other rich persons, the latter may need to be smarter that all persons wanted to be as rich as he is now.
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I mostly agree with you, but I’m going to paraphrase something I saw elsewhere: the only two ways to acquire enormous wealth (e.g. billions) are: (1) inherit it (2) commit crimes.
And with a few exceptions (e.g. Warren Buffett, Taylor Swift) I think that’s pretty much true.
And the problem — as we’re seeing with Musk and Trump and others — is that our justice system is completely unprepared to deal with criminals who have enormous wealth and thus can purchase not only endless delays, but judges and legislatures. The architects of our system could envision a world where someone owned 10X, 100X, 1000X what others did, but not 10000000X, and so they didn’t plan for it. But here we are. And every day some of the worst, most vile, horrible, sadistic, brutal people in our society escape justice because of their wealth…and our society as a whole, and people as individuals, suffer as a consequence.
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A variation on 2 (perhaps enough to make a third way): Identify the possibilities for graft – in particular, things which moral people would say should probably be illegal, but aren’t yet – and exploit them.
They can’t be prosecuted for their past “crimes” because it wasn’t illegal then. Early monopolists, strike breakers, robber barons, etc.
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To be a bit more accurate, #2 should be “exploit poor people”, because someone can exploit the poor to make themselves rich without technically breaking the law. To wit: Taylor Swift is a billionaire, but she didn’t get there only by having a small number of overwhelmingly wealthy people pay to watch her perform.
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Exploit as a word has lost all meaning and just been a tautology for “they are rich and I don’t like them therefore their actions are exploitative” or slightly more charitably “If you make any money from anybody else you are by definition exploiting them because otherwise you could have given them more!”.
Re: Re: Re:3
It’s one thing to quibble over what is considered a fair wage.
It’s another when one side says “we’re asking for minimum wage” and the other party outsources the job to somewhere cheaper to avoid paying minimum wage. Or how the rich had, until recently, stashed away all their wealth in tax havens to avoid paying taxes.
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“the other party outsources the job to somewhere cheaper”
.. only to find out, the hard way, that is is not actually less expensive but it is cheaper.
Strange how the entire wage argument is upside down. The business equation should look at the local economy to determine how much it would take to live there and then use this data as input into their plans wrt potential employee wages. But that is not what is being argued, the majority of discussion on wage is focused upon the minimum wage determined at the federal level and has not been updated for a very long time during which inflation has decimated the poor communities.
Re: Re: Re:5
And that’s because the discussion on wages is led by the obscenely wealthy and their paid-for proxies, who argue that any rise in wages will cut into corporate profits and thus force the need for corporations to raise prices on their products. Never mind the fact that C-suite execs get paid millions upon millions upon millions of dollars more than their minimal amount of labor is worth and hoarding their wealth in such a way that the wealth gap gets worse year after year—poor people making enough money to afford the basic necessities of life without having to go without a given necessity is what’s killing the economy, at least according to those C-suite execs.
What good does all the wealth of the richest people in this world actually do when it’s all locked away from the rest of the economy? How can a single person have a net worth of over $1bn and still think they’re doing anything to help their fellow man? I read the phrase “profits are stolen wages” not too long ago, and there’s a truth to that statement: Every dime that a corporation makes in profit could be put back into the salaries of the people who actually keep the gears in those corporations turning at the ground floor. If an executive disappears in an instant without a trace, a few lawyers have some extra paperwork to do for a few days, and the company keeps on chugging. If half of the company’s lowest-paid workers disappear in an instant without a trace, that company—and likely a good chunk of the economy—would fall into chaos.
No one is more important to the economy than everyone who isn’t obscenely wealthy. Anyone who tells you otherwise is either obscenely wealthy, paid to kiss wealthy ass, or brainwashed by right-wing bullshit.
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“If you can’t believe in the just world fallacy, then what can you believe in?”
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Deez nuts.
There is two basic rules for any company:
Rule #1: You shall not fix what is not broken.
Rule #2: You shall fix what you broke.
But there is now a third rule:
Rule #3: You shall not let Elon fixing, breaking or even touching anything.
“Traveling Monorail Salesman” implies that he actually has some sort of smarts and cunning.
No, he’s a petulant nazi manchild who has only ever failed upwards because he’s the son of an apartheid emerald mine owner, and got lucky with a couple of ventures- usually despite him.
The real con here is other people fooling themselves into thinking wealth equals brains, and letting themselves get sucked in by him. The rest of us have seen through him for years.
Musk is quite literally a floundering idiot with an IQ somewhere in the low-to-mid 90s. He is easily among the most intellectually stunted household names in the world today.
The fact that all these rich people were taken in by such a transparently obvious dimwit and fraud not only speaks volumes about their own incompetence, but is yet more confirmation that their wealth and status is wholly unmerited.
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“Idiot.” You keep using that word. I don’t think it means what you think it means.
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That article doesn’t mean what you think it means.
That article is saying that those words have meant something specific according to some older definition used by clinical professionals. The article also has no citations, so you should definitely take it with a grain of salt. But even taken at face value, it seems to imply that words don’t change in meaning, which is linguistically untrue.
When random AC calls Musk and idiot, they likely mean stupid person. Exact IQ scores equating to particular terminology is just arbitrary human designations. IQ scores change, the IQ tests change, the estimation of the validity of the measurement of intelligence by an IQ test changes, et al.
It would have been more accurate to say “this word used to mean x when used by these particular people in this context.”
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IQ has also been used to justify eugenics and forced sterilization of the “feeble-minded”, so thinking of IQ as if it’s the word of God like a bad idea.
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Re: Re: Re:2
So because low IQ has been used to justify ableist policies, that means people should let go the casual use of the terminology used to justify enactment of those policies? Way to prove you’re not autistic, you unfeeling turd.
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IQ has been tied fairly intimately to not only ableist policy, but also racist policies.
And IQ does not measure the “remarkable diversity of intelligence”, even when it was cooked up.
Re: Re: Re:3
otherwording (or in-other-wordsing) — noun
Example: You will often find the phrases “in other words” or “so you’re saying” at the beginning of an instance of otherwording.
See also: strawman; your post
Re: Re: Re:4
Every accusation a confession.
“There’s no devaluation whatsoever.”
Trump, Musk, Saudi prince. The emperors have no clothes.
Apparently, too much money causes brain damage.
Super Genius Elmo is going NATIONAL!
To wit: Trump Wants Elon Musk to Run a ‘Government Efficiency Commission’
Fail upwards, Elmo!
oh well...
at least its not Boring.
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Or Boeing.
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Or Bing.
Musk is noted for his weird conservative viewpoints so it’s strange that investors thought that twitters value would rise considering that it relys on attracting a wide range of advertising to make a profit
Advertisers don’t want to be associated with content thats racist or extreme or in favor of conspiracys
Musk widely overpaid for Twitter in the first
place it was always a long shot he will make
a return on his investment
Advertisers have plenty of safe places online to place ads that won’t be displayed next to weird extreme content
Most advertisers want to appeal to a wide range of users not a minority of conservative extremists
so the investors were just as clueless as Musk?
What did being woke ever to do with Twitter’s problems? Twitter’s customers are advertisers! Did the advertisers complain about Twitter being woke? Not as much as they complain about their ads being placed next to Nazi content.
The stupid investors didn’t understand Twitter’s business model any more than Musk did. Good lord. What a bunch of stupid people who deserve to lose all their money.
How do such stupid people get so much money to begin with (other than the way Musk did, inheriting it.)
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When you share a similar, if not the same, ideology as Elon, money is a secondary concern compared to their real objective: the Confederatization (read: reestablishment of white supremacy/slaveholding) of everyone and everything.
They didn’t expect Elon to go in loud.
Apparently the biggest believer in Elon being able to turn Twitter around at this point is Saudi prince. I find that very peculiar.
I read that Leon wants to be in charge of the:
Department of Government Efficiency
.. or DOGE for short.
I don’t really remember Elon saying much about making Twitter more profitable. I just remember him saying he wanted to purchase it in order to help protect free speech and stop all the censorship on it which I believe he’s succeeded at for the most part. At least now the fbi aren’t the ones deciding what people can and cannot say or feeding the company disinformation to get them to remove news stories that don’t fit their politics.
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Well, it can’t be worse than having the Russians or the Chinese decide what can be considered “patriotic”, usually with wads of cash.
Oh wait.
Those did happen.
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Not sure what this guys talking about
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BestNetTech has covered Elon shilling for Xi Jinping before, go read it.
And as for the Russians…
Well, recently, two employees of RT were charged with trying to interfere with American politics. Among those implicated in this were a bunch of white supremacist “influencers”.
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Better refresh those memories with actual facts then, because it seems your memory is very selective of what happened and what Musk actually did, especially when it comes to “protect free speech”…
Might be interesting if it was related to Elon’s behavior, but it’s all down to money. Most traditional tech funders are “losing faith”, not just because stakes are losing value, but because higher interest rates are making tech stocks less interesting than simply parking their money in bonds and debt.
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The way you put it makes investors sound worse than Leon.
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These anti-Twitter articles are so funny when you realize 90% of the people here are probably still posting on their Twitter accounts multiple times a day.
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Probably means you are talking out your backside.
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What do you expect? He think he’s cosplaying an asshole but it’s just another way to be a goat-fucker.
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Keep Stephen T. Stone’s bits out of your fucking mouth. You wish you stood where he stands, Anonymous Coward.
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Every accusation a confession.
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And a big dose of projection too…
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I wasn’t even accusing you of anything. This entire comment thread has just been people making completely different non-sequitur replies to what I said. Tell me, Anonymous Coward, how is it possible to live your life with such an incredible amount of brain damage?
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Oh, completely forgot, since I know you’d go for it; your personal challenge is to reply to this comment with something other than a permutation of “no YOU have brain damage!!!”
Your reply will be graded for originality and quality.
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You have more psychological issues than every account-holding BestNetTech commentator combined.
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Originality: 1/5. Is still some permutation of “no u have brian dmg!!!!”
Quality: 3/5. Your brevity is a notable improvement from prior comments. Although you failed the originality check, you still at least attempted to restate the insult in a way that is at least passably original-sounding.
Overall, I’d rate your comment C+ work, Mr. Stone. You won’t be getting into Harvard, but you won’t be failing out of the local community college. I hope to see you apply yourself this way more often in the future.
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lmao go fuck yourself lmao
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It costs zero dollars to not make a Twitter account. It is actually quite easy to not sign up for access to the world’s biggest incubator for mental illness. Give it a try, Anonymous Coward!
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True, it does not cost any money to be born in a Red State.
Sadly, no one would CHOOSE to be born in a Red State if they could choose to be born at all.
Social media notwithstanding.
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I wasn’t even talking about American politics you sperg.
Clearly, Anonymous Coward, the American race is at an end if your country produces people such as yourself. I will breed with your mother in order to save the white race.