On April 14, Beijing time, according to documents from the U.S. Securities and Exchange Commission (SEC), Musk, TESLA CEO and Twitter's largest shareholder, submitted a document proposing to buy Twitter, a U.S. social listed company, at a price of $54.2 per share in cash.
In his filing, Musk explained the rationale for buying Twitter: Twitter has great potential, but it cannot continue to thrive and assume social responsibility according to the existing model, so the company must be privatized.
Affected by the news, Twitter's pre-market share price once soared 15%, rising from $45.85 to $53 from yesterday's closing price, just one step away from the $54.2 proposed by Musk. At the same time, Tesla's pre-market stock price plummeted from rising, falling by more than 2% at one point.
As a result, Tesla investors are concerned about Musk's move to acquire Twitter.
The question is, why does Musk think Twitter has great potential? After taking the social platform Twitter private, what does Musk want? Where did Musk's money to privatize Twitter come from? For China's new car-making forces, the idea of copying homework to privatize Weibo should not be had, Ali proved with actions.
01
Twitter Little Prince VS Twitter Cut Leek King
Musk is the most prestigious technology industry leader in Silicon Valley after Apple founder Steve Jobs.
Currently, Musk's Twitter account ID is @elonmusk, registered in June 2009, and currently has 81.6 million followers. According to the latest data from Wikipedia, Musk ranks eighth among all Twitter accounts with the number of followers (still 81.5 million, and the data is lagging behind the new). At the top of the list was former U.S. President Barack Obama, who had 131 million followers. In front of Musk is Lady Gaga, who has 84.5 million followers.
It is worth mentioning that if you count the former US president Donald Trump and the American actress Ariana Grande, Musk can only rank tenth. It is precisely because the former US President Chuan Jianguo comrade has been banned, which makes Musk like a needle felt, after all, Tesla can not spend a penny to advertise, but still be sought after by consumers in addition to the product power and Musk this flag, and let this flag fly the position is - Twitter.
During Trump's presidency as President of the United States, he posted a large number of remarks on Twitter every day, which was hailed as a Twitter rule, but before Trump left office, his Twitter account was blocked, which was the largest number of fans among all Twitter accounts.
Like Trump, Musk also likes to publish information on his Twitter account, which is even suspected of violating the disclosure of information about Tesla, a listed company, including suspected manipulation of stock prices, virtual currencies and so on. Recently, Musk was sued for becoming Twitter's largest shareholder holding 9.2% of the shares, resulting in losses to Twitter investors due to the failure to disclose in a timely manner, because the news of Musk becoming Twitter's largest shareholder caused his stock price to rise by more than 30% in a single day.
Trump's Twitter account can be blocked, will Musk's Twitter account be blocked?
In fact, Musk illegally published information about tesla listed companies on Twitter, such as the famous Musk in 2018 who wanted to privatize Tesla for $420 a share, Tesla rose more than 11% in a single day, and finally proved that Musk's private funds were ready to be fictitious, this false news and caused stock price fluctuations, was sued by the US Securities and Exchange Commission (SEC), and finally ended in a fine.
On the digital currency Bitcoin and Dogecoin, Musk staged a drama of Twitter with goods, Bitcoin and Dogecoin because Musk bought on Twitter, and stood on the virtual currency, resulting in a sharp rise and fall in the price of virtual currency. At this time, Musk should be the king of Twitter cutting leeks.
For Musk, how to keep the propaganda position of Twitter is what he needs to do. After all, after Trump's Twitter account was banned, its influence has been declining since it was away from mainstream social platforms. It's also what Musk is most afraid of happening. Taking Twitter private is Musk's measure to maintain his influence.
At the cost of $41.3 billion, how should Musk get this money? How do you get your money back and make money?
02
Where and where did $41.3 billion go
According to forbes' implementation of the rich list, Musk ranked first in the world with a net worth of more than $290 billion, surpassing second-place Bezos by $100 billion.
However, Musk's assets are mainly stocks and equity, and cash accounts for very little. At the end of 2021, Musk sold more than $10 billion in Tesla stock to pay taxes. Musk's personal tax bill in 2021 may also set the largest number of personal annual tax bills in U.S. history.
If Musk were to buy Twitter for $41.3 billion in cash, it would be possible that Musk would be selling Tesla stock again. Some analysts believe that if leveraged, Musk only needs to sell about $20 billion of Tesla stock. But is Musk's move to sell Tesla stock and buy Twitter worth it?
It depends on how Musk makes money on Twitter!
In a filing filed by Musk, he said he believes Twitter's current model cannot continue to sustain prosperity and social responsibility. At present, Twitter's main revenue relies on advertising, rather than the individual payment model. Tesla, which has made Musk a god, is pioneering a business model for user software payment.
Therefore, some analysts believe that Musk also hopes to change the current business model of relying on advertising through the Twitter user payment model, which is an unimplemented business model for the current social media platform. Pushing users to pay means that Twitter is going to launch more services than ever before to attract users, which may include relying on Twitter's massive user base to do business, including virtual currency.
According to data from February 2022, Twitter's monthly active users reached a new high of 217 million, with more than 500 million registered users. With such a large number of users, in addition to issuing virtual currency, promoting user payment and other business models, what new ways will Musk play? We'll see.
So far, musk is still controlling companies such as car company Tesla, space company SpaceX, tunnel company The Boring Company, neural technology company Nueralink, and open AI, a non-profit artificial intelligence research organization. Previously, the third-party online payment company that Musk made his fortune was PayPal acquired, that is, the money from selling PayPal gave Musk a basis to chase more dreams.
Will Twitter smoothly become another company controlled by Musk?
If Musk launches an updated business model based on Twitter, will the new domestic car-making forces copy the operation to acquire Weibo? To be honest, this job is expensive to copy and faces huge non-market risks.
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