Elon Musk is perhaps one of the most discussed figures in the world right now following his acquisition of the social media platform Twitter. Born in 1971 in Pretoria, South Africa, Elon Reeve Musk was immediately no stranger to privilege. The son of a model and a rich businessman, Musk was well accustomed to a lavish lifestyle, and his family’s fortunes only grew when his father decided to sell the family’s private jet in exchange for a significant stake in a Zambian emerald mine. The family was so wealthy that the Musk family went to school in a Rolls-Royce, a stark contrast to most South Africans living during the apartheid era. His family’s connections then allowed Musk to move to Canada as a teenager, after which he would attain a Canadian visa and subsequently move to the United States.
In the U.S., Musk transferred to the University of Pennsylvania from Queen’s University in Ontario, graduated with a Bachelor’s degree in Physics and Economics, and then moved to the West Coast in hopes of getting a PhD at Stanford University. There are claims and evidence in court rulings that Musk didn’t actually graduate from UPenn, and was only given a degree two years after dropping out by investors, a move that also made him an illegal immigrant for a brief period as he could not apply for the H1-B visa, which requires a degree, and even that he did not even apply to Stanford. Though these issues may not be that significant in the grand scheme of things, they provide an interesting insight into Musk’s mind and, ultimately where his history of deceit and pretending to be what he isn’t comes from. However, it was true that Musk moved to California, where he became enamored with the world of computers and the internet.
Having watched the internet application Netscape be valued at $3 billion, Musk quickly saw the opportunity that the still young consumer internet market had to offer, and Elon Musk partnered with his brother Kimbal to found Zip2, a quite simple service that acted as a sort of digital Yellowpages. However, the program was so simple that Musk had created a large, fake casing around the Zip2 computer to make it seem like an extremely advanced supercomputer to investors, a move that only further reflects the trends from his alleged college lies. His deceit paid off, and Zip2 acquired $3 million in funding on the one condition that Elon would step down as the CEO to allow someone more experienced to take his place. However, Elon’s evidently self-taught code was soon exposed to be so scrambled that a majority of the program had to be rewritten by more advanced programmers. His woes at the company did not stop there, however, as Musk was also a poor manager, being upset when his employees did not keep working until 9 pm, a trend that would be interestingly reflected in his management of Tesla, as well as his takeover of Twitter, years later. However, after staging a coup to be reinstated as CEO, Elon finally got paid when Zip2 sold to COMPAQ in 1999, winning $22 million from his 7% share.
With this newfound wealth, Musk bought a new supercar (which he later totaled) and showed it off on CNN. Though perhaps not evident at the time, Musk did not only want to get rich; he wanted to be famous, a motive that would become even more apparent in his subsequent business ventures. Following the sale of Zip2, Musk moved on to X.com, where he tried to revolutionize the banking industry by creating an “internet bank.” However, many incorrectly assume that Musk also founded PayPal, when in fact, he only merged X.com with another company that had already founded PayPal almost a year earlier. X.com itself was, unsurprisingly, a mess, with glaring issues and security flaws. Thus, amidst a flock of resignations (including the service’s co-founder), Musk merged with his competitor Confinity, PayPal’s parent company. At PayPal, Musk was appointed CEO after the merger in April of 2000. He was ousted in October of that same year, as under Musk’s poor management, the company was steadily losing money, to the point where if Musk had been CEO for just six more months, the company likely would have been killed. However, Musk retained his shares and, just like with Zip2, received a huge payday when PayPal was sold to eBay in 2002, making $180 million despite his minimal positive contributions.
Another common misconception about Musk’s history is that he helped to found Tesla. Elon Musk did not found Tesla, despite the official Tesla website even claiming so. Tesla Motors was actually founded in 2003 by Martin Eberhard and Marc Tarpenning. Musk didn’t even get involved until the next year, when he invested $6.5 million into the company, becoming the largest shareholder. However, Musk did not play a significant role in Tesla until becoming the CEO, and even when in charge, to date, he only has a couple of patents, one of which makes Tesla chargers exclusive to Tesla cars. In fact, Musk even pushed for his unique chargers to be produced as much as possible. This move then forced some people looking to buy electric cars to purchase Tesla vehicles, effectively being able to then gain a monopoly over the market and thus stopping any more affordable electric car companies from being able to survive and thrive. It is here where Musk’s above-described desire to become famous came into full view, as he then strove to become the face of Tesla, a desire that led him to then drive out the co-founder Eberhard from the company in 2007, a move that led to an onslaught of lawsuits covering everything from denying severance to rewriting history.
Musk’s failures as a leader are even more apparent in the Tesla vehicles themselves, as though they seek to make electric cars mainstream (perhaps the only venture they have been successful in), the cars start at around $50k themselves, and they don’t even do much to help the environment given the mining of lithium required for the production of their batteries, a move that can lead to soil degradation, water shortages, and, ironically, increases in global warming. The safety risks of Tesla vehicles were also papered over by Musk when he knowingly sold cars with dangerous batteries in 2012 and when over 90% of cars manufactured in 2017 had some sort of defect. The problems get worse when looking at failures in autopilot tech, spontaneous bursting into flames, and braking, as Tesla has been slammed by class-action lawsuits and investigations by the NHTSA. His woes only continue into the workplace, as the company has had countless OSHA violations for workplace safety, lost cases concerning racial abuse and discrimination, and has even left hundreds of employee injuries off the books. Even recently, Musk’s decision to have the forced return of employees to Tesla factories during the height of the COVID-19 pandemic led to numerous outbreaks within the company. Furthermore, a lawsuit by the State of California from this year alleged that black Tesla employees were not only discriminated against but literally forced to wipe the factory floor on their hands and knees. And despite all of this, Tesla isn’t even profitable, relying on the selling of carbon credits to make any money, effectively taking advantage of a government program designed to help support more sustainable innovation in order to have any profitable quarters at all, eliminating any potential environmental benefit that Teslas could have. Furthermore, Tesla’s value in the stock market is predicted to be one of the most overvalued, as tends to happen with tech companies.
From these significant examples of Elon’s history, it is immediately clear that not only is he incredibly poor at anything business-related, but he relies heavily on empty promises to drive investment. From his promise of revolutionizing the banking industry to having a million robot taxis by 2020, his failure to deliver on, well, anything, has landed him in hot water in terms of both lawsuits and just running successful businesses in general. Evidently, anyone should approach business with Musk with caution, inevitably leading us to his recent takeover of Twitter.
On April 5th, 2022, Elon announced that he had purchased over 9% of Twitter’s stock. Fearing that Musk might move further to potentially take over the company, Twitter decided to use a poison-pill strategy. In response, Musk put out an offer to buy the company for $54.20 per share, or around $44 billion in total, significantly more than the stock price at the time. Twitter, acting in the interests of its shareholders as a public company, accepted the offer on April 25th. On May 13th, Musk tweeted that the deal would be put on hold as he requested that the company disclose how many bot users it had, likely out of getting cold feet from the potential repercussions of such a consequential spur-of-the-moment decision. On June 6th, Musk threatened to withdraw his agreement, accusing Twitter of refusing to help with identifying the number of bot accounts. On July 8th, Musk announced his intention to cancel his buyout of Twitter, after which Twitter’s chairman, Bret Taylor, announced the Twitter board’s decision to sue Musk in the Delaware Court of Chancery. The lawsuit was launched on July 12th. In order to avoid an almost certain failure in court on October 28th, Musk agreed to complete his buyout on October 4th. On October 27th, Musk walked into the Twitter headquarters carrying a sink, tweeting a photo of himself with the caption, “Let that sink in.”
Almost immediately, the unraveling began. Musk immediately fired the CEO, CFO, the head of legal policy, trust, and safety, as well as the general council of Twitter, all while attempting to find a probable cause in order to not pay out their bonuses (which he will fail at). The next day, October 28th, Musk announced his intention to fire a large portion of the Twitter staff, preferably before the November bonuses, in order to save money. His swift, unforeseen actions led to significant disruption for Twitter, and, coupled with his free speech absolutist ideas, Musk began to drive away major advertisers from the site. For context, advertisers make up about 90% of Twitter’s annual revenue. In a frantic attempt to make any money, Musk announced on November 1st that users would be able to buy Twitter Blue, and thus the Verified blue checkmark, for $8 per month. The short-sightedness of this announcement is immediately apparent, as allowing anonymous users to appear verified and to impersonate formerly officially verified users could have disastrous consequences, and thus Musk also announced that actual public figures would have an “Official” badge. In a turn that everyone saw coming, people immediately began impersonating companies, politicians, and celebrities. On November 4th, Musk announced that up to 3,700 employees, or about 50% of the company, would be laid off, after which he immediately asked some of the fired workers to return. Twitter was then swiftly hit with a class-action lawsuit and was dropped by some of its biggest advertisers, including Volkswagen, Pfizer, and General Mills. On November 11th, Musk suspended his Twitter Blue verification system. Amidst the layoffs, the app has descended into chaos, with Elon Musk at the head. His poor management, childlike tendencies, and lack of self-accountability, paired with his abysmal memes, have made witnessing Twitter’s collapse quite the spectacle.
Just recently, Musk delivered an ultimatum to all Twitter staff, saying that workers could either work “hardcore” or leave with three months of severance pay, stating, “This will mean working long hours at high intensity. Only exceptional performance will constitute a passing grade.” This intensity again mirrors his management of Zip2, but on a much larger scale, by forcing remaining employees to pick up the workload of the thousands that have been fired or resigned. The worst part of Musk’s takeover, however, is for workers on visas, as they don’t have the luxury of just leaving their jobs. Given that their living in the United States is reliant on their employment, Musk is effectively exploiting their compromising situation. The layoffs have had significant technological implications as well, with two-factor authentication being temporarily broken and services in various countries, like India, being interrupted. The Twitter debacle has certainly been unstable, as now even services like the App Store are threatening to pull Twitter. Only time will tell if Elon Musk is able to recover from his disaster, but given his track record, a miracle would likely only come in the form of some acquisition. For now, though, we can only watch from the sidelines as the future of Twitter, Elon Musk, and information as a whole hangs in the balance.