Elon Musk, Twitter Inc.’s new owner and until recently the world’s richest person, has spent most of the past two months pouring his time, energy and finances into the highest-profile social network on the internet. But finally, Musk seems to be running out of gas.
On Tuesday evening, he announced plans to find someone else to run the company. He was adhering to the results of his own Twitter poll, which showed almost 58% of voters wanted him to step down.
During the 12-hour window that the poll stayed open, Musk tweeted relentlessly, coming across like a man worn down and skeptical that the company he paid $44 billion for just two months ago can even sustain operations.
“The question is not finding a CEO,” he wrote shortly after the poll started Sunday afternoon. “The question is finding a CEO who can keep Twitter alive.” When Lex Fridman, the popular AI researcher and podcaster, offered to run Twitter on Musk’s behalf, the CEO replied that Fridman “must like pain a lot.”
“One catch: you have to invest your life savings in Twitter and it has been in the fast lane to bankruptcy since May,” he added. “Still want the job?”
Musk joined Twitter Spaces, the company’s live audio service, after confirming that he would step aside and explained the financial squeeze. He said Twitter had been facing negative cash flow of about $3 billion next year because of its spending plans and interest payments, which is why he spent the past few weeks “cutting costs like crazy.” Now he said the company should be able to get to roughly cash flow breakeven next year. "This will be difficult," he said.
Musk has tweeted incessantly during his tenure, taking the news cycle with him. He picked fights with the media and leaked his own employees’ private messages and emails; he sparred with Apple Inc., reinstated former President Donald Trump’s account based on the results of a Twitter poll, and recently started discussing the possibility of his own assassination. Musk has a knack for becoming Twitter’s main topic of discussion, even when he doesn’t intend to be, like when he was booed at comedian Dave Chapelle’s show in San Francisco earlier this month.
If Twitter’s user growth has increased since Musk took over in late October, a claim he often repeats, it’s easy to assume people are there to see what Musk does next. The result is akin to Trump’s presidency — but even Trump took a day off to play golf every now and then.
Running Twitter is a uniquely pressured job, involving making decisions critical to global political discourse in one moment, and making a call on the product vision in the next moment. Former CEO Dick Costolo once equated it to “dog years” – a single year running Twitter was like working seven years at the helm of some other company, he said.
Under Musk, though, time feels even more compressed, with chaos sparked all day, and on evenings and weekends. In the short time Musk has controlled the company, almost everything he’s decided has spurred intense debate, often resulting in his reversal of those same controversial decisions. Those who have worked with him these past two months describe a leader who is impulsive, erratic, and ultimately ill-prepared for the challenges Twitter provides, which include dealing with internet speech and a user base whose power users spend much of their time writing and commenting about the company itself. Despite months to prepare for the eventuality that he would ultimately own Twitter, Musk showed up largely without a plan, they say.
That much is evident when you examine Musk’s approach to Twitter’s business, which was profitable at the beginning of the year but somehow losing $4 million per day by early November, Musk claims. Musk’s own antics have scared off Twitter’s advertisers; he has tweeted misinformation, posted masturbation jokes, and bungled Twitter’s verification program by enabling imposter accounts to pose as major brands.
Add in the debt that Musk took out to buy the company — resulting in $1.2 billion in estimated annual payments for Twitter — and the company may indeed be in the “fast lane to bankruptcy,” as Musk has called it.
Part of the problem may be that Musk just doesn’t have the time needed to run a company with as many problems as Twitter. “We are seeing somebody who is a technological genius who is at the end of his tether — he’s overstretched,” said Jeffrey Sonnenfeld, a professor of leadership studies and management at Yale who has followed Musk’s career closely. Prior CEO Jack Dorsey attracted activist investor attention for holding two jobs. Musk, by contrast, has at least three, and several other time-sucking hobbies.
Tesla Inc., by far his most valuable holding, has suffered mightily. Its shares have tumbled by more than 60% this year, including an 8.1% drop on Tuesday.
Musk has been both impulsive and self-destructive during his short time in charge of Twitter, Sonnenfeld added, a combination that has led to a loss of trust among advertisers. Musk’s response has been to distract people from Twitter’s problems, a skill he’s mastered at his other companies where he makes all kinds of promises that go unfulfilled but leave people optimistic that things will soon improve. “From flame throwers to leaf blowers, he’s in the business of distraction,” Sonnenfeld said. “With Twitter, he’s flailing about worse than ever, like a wounded animal in the corner.”
While Musk’s role as CEO has created all kinds of uncertainty for Twitter, so too does his decision to step down. It’s possible that Twitter will find a more predictable and stable chief executive who can woo back scared advertisers and roll out thoughtful content policies that took more than a couple of hours to compile. The whole point of taking Twitter private was to allow the company to make changes without the pressures that come from Wall Street. Perhaps the same could be said about avoiding the scrutiny that comes with having a CEO who is also one of the most famous and polarizing people in the world.
Finding the right leader will be key, though, and Musk’s tweets about possible bankruptcy suggest Twitter doesn’t have a ton of time to figure it out. Some of Musk’s supporters believe the poll was all just part of his master plan, though Musk himself suggested otherwise. “No one wants the job who can actually keep Twitter alive,” he tweeted Sunday. “There is no successor.”
For Twitter, where the employee base has been decimated, the prospect of a “mystery” CEO may be just as confounding as leaving Musk in charge. While Musk has learned the hard way that running Twitter is an infuriating task, he’s also made the company as buzzy as it’s ever been. With Musk in charge, Twitter at least has that going for it.
That will likely continue. Musk says he’ll stay on to help Twitter with software and servers, “as soon as I can find someone foolish enough to take the job” at the top.
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(With assistance from Ashlee Vance and Vlad Savov.)
