What if Musk's strategy is to destroy Twitter?

Question

Elon Musk is clearly taking the hammer to Twitter. What does HN think of the idea that he is doing so intentionally? Is there a possibility that Elon is trying to bankrupt Twitter so that the creditors call their loans, only to sweep in with a bit of his own cash and buy them out for pennies on the dollar? Such a strategy would carry a great deal of risk. Creditors could sue him if there's evidence that he intentionally trashed the asset. But Elon Musk is known to take extreme risks. He may view the possibility of owning Twitter for a far smaller price to be worth the risk of losing it all.

i13e · Accepted Answer

I think this 4D chess argument gives Musk way too much credit. The truth we all need to come to terms with is that billionaires are as incompetent as the rest of us. His DMs released during the court case are proof enough of that.Relevant thread - https://news.ycombinator.com/item?id=33057042

rossdavidh · Answer

Alternative hypothesis: he needed to cash out a lot of Tesla stock at (or near) the peak, without it freaking people out. Twitter was mostly just an excuse to do that. If he had not had the Twitter excuse, he could not have sold as much Tesla stock without a much bigger drop in the stock. So, from his point of view, he basically got Twitter for free; if he hadn't bought it, he would have had to hold onto more Tesla stock, which would have slid in value, so the money he "spent" on Twitter was mostly just replacing money he would have "lost" as Tesla stock followed everything else down.
He probably regretted it, hence the attempts to get out, or maybe that was all just because he likes attention. Regardless, he now has a Twitter, essentially at no cost to himself because if he hadn't bought Twitter with that money he would have lost it anyway as the Tesla stock slid. That doesn't mean he wants to pay anything to keep it going. So, a much smaller Twitter that is break-even is better for him than a larger one that (at least in the short term) requires him to put money in.
Just an hypothesis; not sure if I even believe it myself, just putting it out there for consideration.

kranke155 · Answer

Nah, considering he's let Jordan Peterson back on, and apparently is considering Trump - I think Elon is just a right winger who realized he was surrounded by lefties (apparently Twitter graded managers on empathy? Lots of pronouns on profiles, etc. not saying that's a bad or a good thing) and decided to dump them all.
Basically Elon is a soft Republican/Trump supporter who is like "Trump didn't do anything wrong" and intends to make the platform a free for all.
It makes sense with a lot of his statements as well. Why obsess over the blue ticks? Cause the right wing was upset about it. Why obsess over freedom of speech? Because the right wing said they were being removed en masse from platforms. etc. etc.
There was a great twitter thread explaining all this that I read today, but for the life of me cant find it.
Ah found it here - https://twitter.com/MattBinder/status/1593474503996280833
all the why Elon Musk bought Twitter theories are overthinking it.
it’s simple.
Musk is in a right wing filter bubble. he bought Twitter believing their problems were real & that others felt the same

Zigurd · Answer

All theories about Elon destroying Twitter intentionally have several defects:
1. Elon did not want to buy Twitter. But he wanted litigation and depositions even less. Is there a less good reason to close on a $44B deal where the value of the equity investment can be marked down to zero on day 1, and where the creditors are hostages to their now inadvisable contracts?
2. His decision was impulsive and cynical: He thought he could "flip" Twitter and lose less than a settlement would cost. That notion was dead on arrival, and now you see a narcissist flailing around trying to distract people from the fact he made one of the worst business decision in human history.
3. The scale of this mistake is boggling: $44B is the market cap of Foxconn. He could have bought Santander and launched his X app. He could have bought AIG. Or National Grid. Or LG Chem. Or Ferrari. Or Block. Or Maersk.
To destroy that much value on a struggling social media company in order to destroy the company is the kind of myth making that narcissists, and their fanbois, do.

mytailorisrich · Answer

I think there is a massive clash between Musk and Twitter's internal culture and so beyond any changes of external business strategy he is attempting to change that internal culture to fit his. He must know that this implies an extensive change of staff but at the same time it must be paced to ensure continued operation and transmission of knowledge, and that seems to be the tricky bit.

bell-cot · Answer

IANAIB (not an investment banker), but I'd hope that the creditors were sane enough to make Elan personally co-sign on the loans.Not that losing the $$$ of his own that he spent buying it would be painless.

dingosity · Answer

I bet Elon is not brave enough to buy Fox or Palantir.(which is my way of trying to goad him into buying those companies and twittering it.)

mildchalupa · Answer

He would be screwing over his current creditors, they would then be unlikely to fund his future investments.

groffee · Answer

It certainly seems that way.

Finnucane · Answer

Burning $30 billion to welsh on $13 billion seems like not the best plan?

paulpauper · Answer

engagement is way up, at least according to musk. If he wanted to destroy it he would not unban popular, high traffic accounts.

retrocryptid · Answer

I think Elon Musk is playing the UFOs and has selected the Claw of Cthulhu victory condition. After failing to destroy PayPal, Tesla and SpaceX, he's going to have to double-down on destroying SolarCity.

What if Musk's strategy is to destroy Twitter?

I think this 4D chess argument gives Musk way too much credit. The truth we all need to come to terms with is that billionaires are as incompetent as the rest of us. His DMs released during the court case are proof enough of that.
Relevant thread - https://news.ycombinator.com/item?id=33057042

IANAIB (not an investment banker), but I'd hope that the creditors were sane enough to make Elan personally co-sign on the loans.
Not that losing the $$$ of his own that he spent buying it would be painless.

I bet Elon is not brave enough to buy Fox or Palantir.
(which is my way of trying to goad him into buying those companies and twittering it.)

He would be screwing over his current creditors, they would then be unlikely to fund his future investments.

It certainly seems that way.

Burning $30 billion to welsh on $13 billion seems like not the best plan?

engagement is way up, at least according to musk. If he wanted to destroy it he would not unban popular, high traffic accounts.

I think Elon Musk is playing the UFOs and has selected the Claw of Cthulhu victory condition. After failing to destroy PayPal, Tesla and SpaceX, he's going to have to double-down on destroying SolarCity.