Elon Musk hints that layoffs are in Twitter’s future

Elon Musk spoke to Twitter workers for the first time since he agreed to acquire the company in a meeting that tackled topics ranging from layoffs to aliens to who will be CEO and what will change once he takes control.

Musk started the conversation, moderated by Leslie Berland, Twitter's chief marketing officer and head of people, by reiterating how much he loves Twitter and that he "wants to buy" the company. We reviewed a recording of the meeting.

Not much else was said about the process of how he is actually going about purchasing the company. The questions put to him focused mainly on his plans for the platform, product changes, changes to the business, and his views on free speech. Musk spoke at length, in a meeting that went just over an hour, about many subjects, some he was asked to talk about and some he was not.

Here's a breakdown of some of the central points Musk made during the meeting: 

Layoffs are likely

Musk did not mince words when asked about layoffs at Twitter, pointing out that the company's revenue is currently less than it spends each year.

"That's just not a great situation," Musk said. "Some rationalization of the headcount, and an expectation that revenue needs to be greater than costs. Otherwise, Twitter is simply not viable, or you know, can't grow."

"That's not a great situation to be in," Musk said. "So there would have to be some rationalization of headcount and expenses, to have revenue be greater than the cost, or else Twitter is simply not viable or can't grow."

He explained further that any layoffs would not affect those seen as "a significant contributor" to the company. Such people "should have nothing to worry about," he said.

"I do not take actions which are disruptive to the health of the company," Musk added.

He really likes Twitter and has plans for running it, including ads and payments 

There has been a lot of speculation, given Musk's criticism of Twitter's leadership, its operations, and its user numbers, that he may no longer want to own the company. Musk was clear in the meeting, though, how much he "loves" Twitter and described a number of plans he has for operating the business once he acquires it later this year.

"Some people use their hands to express themselves," Musk said. "I use Twitter."

He wants advertising on the platform to stay and "be as entertaining as possible." But he wants only "good products" to be advertised, not "scams," like he claims are advertised on YouTube. He was recently "scammed" by a faulty product he purchased through an ad on the video platform, he said.

Musk, who co-founded PayPal, also suggested payment systems should be integrated into Twitter, so people can send money (and crypto) back and forth to one another and also make purchases.

"That's an increase in usefulness," Musk said.  "News, entertainment, and payments, I think, are like three critical areas."

Twitter should be "so compelling you can't live without it," he added.

He doesn't care about the CEO title but expects people to listen to him

Musk said he's "not that hung up on titles" when asked whether he would be CEO of Twitter, replacing current CEO Parag Agrawal. Then he pointed out that he officially changed his title at Tesla from CEO to "Techno King" and his CFO is "master of coin," because he "thinks it's cooler."

Regardless of his title, Musk does want to "drive the product in a particular direction" and intends to lead the improvement of the platform's software, product, and design. 

"I don't mind doing other things related to operating a company, but there are chores," he said. "I really just want to make sure that the product evolves rapidly and in a good way. I don't really care what the title is, but obviously, people do need to listen to me."

"Bots" are his biggest concern, but he doesn't fully understand them

Asked what part of Twitter he wants to gain a "deeper understanding of," Musk brought up "bots" or automated spam accounts that he has previously made a major issue out of since agreeing to acquire the company. He is now receiving a massive amount of data on active Twitter users, which Twitter leadership expects him to use to make "crazy" claims about the prevalence of such accounts in an effort to renegotiate his $44 billion offer, as Insider previously reported.

Musk admitted during the call that he has "less understanding" of bots on Twitter, but that the possibility that they may affect the platform's number of monetizable users is "probably my biggest concern."

"That's really what drives advertising revenue as well as subscription revenue and really Twitter revenue is going to be subscriptions, advertising, and I think payments would be an interesting thing to do as well, " Musk said. "All of those things are only relevant for how many unique humans are on the system."

He doesn't want "offensive" or "boring" content on Twitter

Asked to clarify his position on free speech on the platform, and what he will do about the prevalence of extremist, abusive, and illegal content that is currently moderated, Musk reiterated he wants Twitter to operate "within the bounds of the law." He also recognized that in order for more people to use Twitter, they cannot be shown such content.

"It's important to make Twitter as attractive as possible," Musk said. "Really, that means not showing people content that they would find offensive. Or even, frankly, boring is not good. TikTok does a great job of making sure you're not bored."

Apparently, Musk recently tried TikTok for the first time and said, "It does just feel like ADD, but like, next level."

He wants to see Twitter used by a billion people

Twitter currently has about 230 million daily active users, or people who open the app at least once every day, according to Twitter's current metrics. Musk thinks Twitter should have many more.

"Currently, this is... a small business model," Musk said "You've got 8 billion people on earth. That's 7.8 billion people doing nothing here."

"The potential is there for Twitter to have been accessible to an order of magnitude more people and for a lot more people to find it useful," he added.

Musk later spoke of wanting "at least a billion people, maybe more" to use the platform. At another point during the call, he suggested that 50% of the world population "could find Twitter useful."

He intends to issue stock privately to Twitter workers

Musk said he will likely implement a stock-based compensation plan similar to what he currently does at SpaceX, which is also a private company. Twitter workers are used to having an often substantial portion of their total compensation come in the form of restricted stock units, which vest quarterly over a period of four years. As a private company that will no longer be the case.

Every six months, there is a " liquidity event" at SpaceX where employees can sell their private shares of the company to outside buyers at a set price. "It's worked very well for the whole life of the company," Musk said.

"Something like that would make sense at Twitter," he added. 

He only wants "useful" people working at the company

Musk also fielded this question: "Twitter has a lot of incredible. Smart, talented people. What can we do to earn your trust and what are you going to do to earn ours?" In response, he talked about taking Twitter "to the next level," and seemed to allude to who should not be working at the company.

"If somebody's getting useful things done, then that's great," he said. "If they're not getting useful things done then like, okay, why are they at the company? So, it's just really just, like, we need to improve the technology, improve the design and, you know, trust emerges from that."

He added that if people who work for him are "getting stuff done... I love them." If they are not, "I don't like that." 

"It's pretty straightforward to me."

He prefers in-person work unless you're "exceptional"

Berland mentioned that about 1,500 Twitter employees currently work remotely full time, and almost all of the remaining 6,000 employees work in a hybrid model with some days in the office and some days remote. Musk recently said that all employees at Tesla would be required to spend at least 40 hours a week working in person. During the meeting, he admitted that making cars is different from the type of work happening at Twitter, but that even at Tesla some software engineers and the like can still do some remote work. Although he still prefers people to work in person.

"You want to aspire to do things in person," he said. "But if somebody is exceptional at their job, then it's possible for them to be effective, even working remotely."

He said at Tesla, he's "simply asked for a list" of workers from managers there, detailing which workers are deemed an "excellent contributor" and a decision on remote work is made from there.

Even then, he thinks people need to show up in person some of the time in order to "recognize their colleagues."

"If you're walking down the street and pass your colleague and you don't recognize them, that would not be good."

Twitter's internal Slack messaging boards started to "go off" in "confusion" over these comments, according to a person present at the meeting. Berland later followed up and Musk added: "The bias definitely needs to be strongly toward working in person."

"It's just better," he said.

He wants people and creators to make money on Twitter

Musk brought up YouTube, which he has been tweeting about over the past couple of weeks. He compared it to Twitter in terms of how creators are able to make money on YouTube, but "not on Twitter" even if they use the platform to interact with their audience.

"Creators use Twitter to drive traffic to their YouTube videos because that's how they make a living and that really should be on one square."

He'll be back

Berland asked if he would come back for "part two" of the meeting at Twitter because there was so much to cover. "Oh, yeah," Musk said. "Absolutely. Happy to."

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