American billionaire known for his memes and large followings has now snapped up a sizable chunk of the popular social media platform, Twitter. With a valuation of about US$2.89 billion, the Tesla chief now owns about a 9.2% stake in the platform.
The report was made by the Security and Exchange Commission (SEC) filing. That said, Elon Musk now holds the second-highest stake in the company according to Bloomberg.
Apart from owning such a huge stake in the company, Musk is a known user on the platform and he’s known for his stance on the freedom of expression. He in fact held a poll back on Mar. 25th, asking if they thought Twitter “rigorously adheres” to the principle of free speech. Over 70% of respondents said NO.
Although Twitter is a private company and it’s protected under the law to create its own regulation, Elon Musk’s freedom of speech reference was under the US First Amendment which only applies to government censorship of speech.
In fact, he also made a post where he asked if there’s a need for a new platform after saying that he’s giving it a serious thought to whether he should start one. However, he probably didn’t take that route.
It’s unclear what Musk’s intentions with Twitter are, but his stake in the company could impact its long-term strategy.
“Specifically, Musk could seek to influence the openness of the platform and how it controls content or push to invest in the subscription model more aggressively,” Ali Mogharabi, a senior equity analyst for Morningstar, said in a note on Monday.
However, the social media giant started a US$3/M subscription called Twitter Blue which allows people to undo tweets, read ad-free articles, and get access to some exclusive features on the platform.
As a businessman, Elon Musk is probably on to take a bite of those pie as a stakeholder in the company.
Part of the changes made by the company includes a change in the executives as the company’s co-founder Jack Dorsey left to focus on his financial company, Square.
Parag Agrawal took over the position from his previous position as the company’s CTO. Twitter reported $5 billion in annual revenue in 2021 and currently has 217 million daily users who currently see ads. Twitter has a goal of reaching at least $7.5 billion in annual revenue and 315 million users in 2023.
Away from the business side of things, Musk is known for his controversial tweets which often land him in hot waters including a legal battle with the SEC back in 2018 when he told his followers that he was ready to take Tesla private.
That led to regulators suing him for “false and misleading” statements. A settlement was reached while he was required to pay about US$20M while also giving the SEC oversight over some of his social media posts.
Since then, Musk’s lawyers have argued that the oversight policy has become unworkable and asked a federal judge to end the settlement.
Twitter didn’t immediately respond to a request for comment. Following the news Monday about his stake in Twitter, Musk tweeted, “Oh hi lol.” Later in the day, he tweeted a question: “Do you want an edit button?”