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The Bird & The Technoking

  • Skribentens bild: Karl Johansson
    Karl Johansson
  • för 2 dagar sedan
  • 29 min läsning

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The Introduction

 

Elon Musk is well known to be eccentric, a trait considered endearing to his fans and base attention seeking to his detractors. Whatever you may think of the man his eccentricities are a fact. As evidence consider this filing1 made to the American securities and exchange commission in 2021 which introduces a small change in the company’s nomenclature. “Effective as of March 15, 2021, the titles of Elon Musk and Zach Kirkhorn have changed to Technoking of Tesla and Master of Coin, respectively. Elon and Zach will also maintain their respective positions as Chief Executive Officer and Chief Financial Officer.”  The title change was no one off gag either, while Kirkhorn was referred to as the company’s Chief Financial Officer in Tesla’s 2021 10-K filing2, American regulatory speech for annual report, Musk was still officially the company’s Technoking. CNBC quotes3 Musk saying the Technoking title is a bit of a joke: “So CEO is a made-up title, CFO is a made-up title, general counsel...They don’t mean anything. […] I’m legally ‘Technoking’. I just did that as kind of, like, a joke — just to show that these titles don’t mean a lot”. Musk has done plenty of noteworthy things aside from his unusual choice of title, and while his laid back attitude to corporate language is refreshing he is best known for his high profile takeover of Twitter.


Is a prankster like Musk suited to be the guardian of free speech on the global digital town square? Everyone has a take on this and with a public figure like Musk it is easy to find plenty of statements supporting whichever side you might be on. Add to that that Musk’s trickster persona means that plenty of his statements are interpreted as ironic jokes by some and as genuine convictions by others. Consider the title of ‘Technoking’, it could be interpreted in the way I did just now: as a joke meant to highlight the absurdity of self-important corporate language. It could also be interpreted as a self-aggrandising, hubristic attempt to cast himself as a technology genius. Does being a successful businessman, irrespective of one’s inclination for jokes, make one suitable to be responsible for the “global town square”4?  This series will grapple not only with the narrow questions of whether or not Elon Musk lives up to his claim of being a free speech absolutist, or whether or not he is suited to run Twitter, but with broader questions of how social media should be run, and for whom. The Musk-Twitter affaire is not only interesting for its cast of colourful characters or the crazy twists and turns. It also raises profound questions about what role social media does and should play in a modern society, about what freedom of speech is and looks like in the digital age, and about how much power a democracy should allow a single wealthy individual to have.


This series will set out to answer those questions by exploring who Elon Musk is, what kind of platform Twitter is, how a 21st century democracy does and should use social media, and finally and perhaps most importantly it will sidestep the question of whether Musk is the right person to run Twitter to instead ask if anyone is suited to own a social media site with hundreds of millions of users. The first chapter, titled ‘The Man’, will explore who Elon Musk is, what has his business career been like, and what can his life story tell us about his suitability as the Technoking of Twitter? The second chapter, titled ‘The Bird’, will explore what Twitter is, its founding and history, and to what extent it matters who owns it. Chapter three ‘The Dilemma’ will grapple with the dual questions of what role social media plays in our contemporary society, and what role we think it should play. Does social media shape culture and politics, and if so how? Chapter four ‘The Bird & The Technoking’ will build on our previous discussions to answer the core question of this series: is there anyone who would be suited to owning a social media site? And finally chapter 5 ‘The Twist’ will broaden the aperture to ask how social media can and should be regulated to temper its worst excesses, and bring its governance in line with democratic ideals of power sharing and free speech.

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The Man

 

Our central character in the Bird & the Technoking is of course Mr Elon Reeve Musk. To answer the question of whether he is the right man to run Twitter we need to start by establishing what kind of a man he is. Most of the articles discussing Musk’s purchase and management of Twitter are focused on Musk’s views on free speech, and while that is certainly important, it is useful to paint a broader picture. As mentioned, Musk is an eccentric man, perhaps the Ur example of an eccentric billionaire. Musk has been a public figure going on 20 years so it would be easy to cherry pick quotes and incidents to frame him as fickle and temperamental or as a far-seeing futurist. Reality is more nuanced, one does not exclude the other. This first chapter of the Bird & the Technoking, ‘The Man’, will investigate who Elon Musk is; what beliefs he holds, and perhaps most importantly: does the evidence suggest his Twitter takeover is a magnanimous act or an attempt to buy low and sell high?


Musk enters the public eye in the late 1990’s when he started an internet firm with his brother Kimball and Greg Kouri. Global Link Information Network was started in California in 1995 and the idea for the company was to provide background services so that newspapers could produce and host online city guides1. By the end of 1996 the company had changed its name to Zip2 and had managed to get contracts with over 130 newspapers in the US, including the New York Times2.  In 1998 Zip2 pursued a merger with its main competitor, CitySearch, but the Musk brothers persuaded the board to abandon the deal, due to incompatible cultures and incompatible technology3. Elon Musk tried, unsuccessfully, to become CEO of Zip2 before it was bought by Compaq – a PC hardware manufacturer – for $305 million in early 19994. After the acquisition Musk was paid $22 million for his 7% share of Zip2 and used those funds to launch his next internet venture which set him on the path to become the richest man in the world.


Before we get to that though, it is worth dwelling on the Zip2 era of Musk’s career. Most people will know Musk from Tesla and start his business biography from either his time at PayPal or his acquisition of Tesla. But given that some important pillars of Elon Musk’s mythology starts with Zip2 it is important context, and it foreshadows later events. The central pillar of Musk’s success according to the man himself is that he is an incredibly hard worker. CNBC quotes5 Musk as saying “If you do the simple math, and say if somebody else is working 50 hours [a week] and you’re working 100, you’ll get twice [as much] done in the course of a year as the other company.” And the mythology of the hardest working, most industrious man in tech starts in Zip2’s Palo Alto offices. The term ‘mythology’ is used we cannot verify what exactly happened back then, and cannot know if Musk is misremembering or playing up the hardships of those years to make himself seem more diligent. He could be telling the truth without embellishments, but given that the only sources for the lifestyle Musk claims to have been living at the time are from Musk himself years later it is fair to take his claims with a bit of salt. Especially when you hear the claims.


In that same CNBC article Musk says the following about his Zip2 days: “We showered at the YMCA and we were so hard-up that we only had one computer […] The website was up during the day and I was coding it at night, seven days a week, all the time. I briefly had a girlfriend in that period and in order to be with me she’d have to sleep in the office”. Zip2 was founded in November 1995 and received its $3 million capital infusion sometime in 1996 so if the times were indeed so tough that Musk had to sleep in the office, it was at least a mercifully short period. There is also an odd inconsistency on how the company was initially funded. In her book about Elon Musk Ashley Vance states5 that the company received $28 000 in funding from the Musk brothers’ father, Errol Musk. Elon Musk however, claims6 in a 2019 tweet that the company was started with the three co-founders’ own money and that Errol “provided 10% of a ~$200k angel funding round much later, but by then risk was reduced & round would’ve happened anyway”. In the grand scheme of things $20-30 000 is not that important given how quickly Zip2 raised the additional $3 million, and given how much the company would eventually sell for. But it is notable how Elon Musk is careful to downplay his family’s wealth, and play up his personal contributions.


With $22 million burning a hole in his pocket Musk started his next company X.com in March 1999, along with Harris Fricker, Christopher Payne, and Ed Ho. Musk invested7 $12 million and his co-founder in Zip2 Greg Kouri invested too, though the exact figure appear to have been lost to time. X.com was supposed to be an online bank which also let its users buy low-cost index funds and in a December 2000 press release from X.com states8 that: “the company will expand the capabilities of X.com to include the full range of consumer and small business financial services, including integrated brokerage, insurance services and more. ‘The Internet will allow us to provide a range of financial services much more conveniently and inexpensively than ever before,’ said Musk, ‘and the beneficiary will be our customers.’” The historical context here is important. X.com certainly benefitted from being in the internet boom of the late nineties, and to a certain extent so did Zip2. Excitement for what the internet could be, and optimism for the positive impacts global connectivity would bring were at an all time high. And unlike later internet booms like the social media boom in the 2010’s or the rise of e-commerce the technical barriers to launching a professional website were so low that it was in clear reach of individual hobby coders. The December 2000 press release8 stated that the X.com website was set to launch later that week, only nine months after the company started, which is an incredible time frame for launching a bank. Especially one which allows customers to invest in mutual funds. X.com merged with its main competitor Confinity just a single year after its founding, at which point X.com had over 200 000 users. The combined firm, which would be renamed PayPal shortly after was in turn purchased9 by Ebay for $1.5 billion in late 2002.


X.com sounds like a piece of unrivalled businessmanship; a company started with some $12 million is bought for $1.5 billion three short years later. Again though, we have to consider the circumstances surrounding X.com. In an interview10with CBS Market Watch in December 1999 we find the following exchange:


“CBS.MW: Stockjungle.com came out recently with their no-fee S&P fund. You're actually taking the next step of paying people to invest in the fund?


Elon Musk: There is a rebate of one basis point, not a tremendous amount of money, but it is intended to show the point of being very low on the cost side and to have none of the encumbrances that plague traditional mutual funds.


CBS.MW: So the essential mandate on this fund is that X.com will always lose money on it. It can never be a profit center.


Elon Musk: There is a small amount of float where we do make a little bit of money.


CBS.MW: Yes, but Barclays is certainly charging fees to manage the fund. You're picking up the tab on that?


Elon Musk: That is correct. It's intended as a loss leader.”


X.com was a grand success, but it appears to have been less about building and maintaining a stable and growing business and more about creating a technical solution and using seed capital to quickly attract large amounts of users by effectively subsidising buying mutual funds. This was done to create the appearance of extreme growth which makes the company an attractive prize to be bought by a larger company; a form of proto-blitz scaling if you will. Blitz scaling is an idea which became popular in Silicon Valley and with the San Francisco venture capitalists in the ultra-low interest rate environment after the Great Recession. The idea was to build a technological solution and subsidise the use of that platform to gain a critical mass of users, at which point prices could be raised and the overall business would be both large and profitable in record time. For Musk this approach was certainly a smart bet, but does selling a company at an inflated valuation equal business genius?


The X.com saga is foundational to the Myth of Musk as it is what catapults Musk into business stardom and makes him an alumnus of the mythical ‘PayPal Mafia’ along with other Silicon Valley titans like Peter Thiel, Steve Chen, and Reid Hoffman. The “Mafia” is the term for a group of influential founders and financiers who got their starts at PayPal and who made substantial fortunes out of the Ebay takeover of PayPal. Being a member of the “Mafia” was not only a great business venture for Musk, but it also gives great prestige as it implies him to have been one of the great minds behind PayPal, a service which can genuinely be said to have revolutionised money transfer. The trouble is that Musk had very little to do with PayPal, and very much to do with X.com. As mentioned, X merged with Confinity in March 2000. Confinity, founded by Peter Thiel, had actually developed the PayPal money transfer system and launched before the merger with X.com. Musk was CEO of the merged entity until six months after the merger when the board of directors voted to replace him with Peter Thiel while Musk was on honey moon in Australia. Not to imply that Musk had nothing to do with PayPal, or that his contributions to X.com and PayPal were negligible. Only that the idea that Musk founded PayPal is not true, and that X.com seems more like an early attempt at blitz scaling to get acquired than a revolution in internet banking.


It is also worth bringing up Musk’s associates at X.com. As mentioned, Musk co-founded the company with Ed Ho, Harris Fricker, and Christopher Payne. Later the company hired former Intuit CEO Bill Harris as CEO and John Story from Montgomery Asset Management to head up its mutual funds business. After just five months Musk fired Fricker and the other two co-founders left in the aftermath. Harris and Musk reportedly disagreed over the direction of the business and Harris left two months after the Confinity acquisition. We do not know exactly what happened at X.com before or after the merger, and it would be unfair to make judgements about how different people acted, but when trying to piece together what happened more than 20 years ago it seems like Musk was difficult to work with. Between March 1999 when X was founded and September 2000 when Musk was replaced as CEO by Peter Thiel three co-founders and an experienced tech CEO left the company only for Musk to be ousted while he was out of the country. Hardly sounds like a friendly and harmonious working environment. Add to that the comments Musk is reported to have made to Gawker in a July 2007 article11:


“First, it is worth saying that there is no significant rivalry or animosity that I'm aware of today between myself and Peter Thiel or Max Levchin.” Musk then goes on to discuss Zip2 saying: “Regarding my first company, Zip2 was sold for about $300M, not $400M as you state […] I'm don't know on what basis you conclude it was worthless. Zip2 counted the NY Times, Knight-Ridder, Hearst and other media companies as both investors and major customers for its Internet software & services, and would have gone public if not for the acquisition. After Compaq bought my company, it was merged with Altavista and the combined entity was rather poorly managed by execs whose main background was making PCs in Texas, but Zip2 was certainly valuable when it was sold.” Musk also comments on the issue of who should be called a founder of Paypal: “As far as who deserves co-founder credit for PayPal, let me throw out a few reasons why it is probably fair to consider me for such (without detracting from Max and Peter's similar status): […] When PayPal was sold to eBay, I was the largest shareholder by a significant margin. Nobody gives away shares for free, so this is a reasonably objective indicator of contribution.[…] if:Founding the company that constituted half the post-merger equity and more than half the employees of the company that became what is known today as PayPalComing up with the business model & main customer growth mechanismHiring the people who served as CFO, VP product management, VP engineering, customer service, HR (etc) in the combined companyRunning X/PayPal for the formative first half of its existence and being on the board the entire timeBeing the largest shareholder when all was said and doneare not good tests for deserving co-founder status, then what are good tests?”


The specific issue of whether Musk deserves to be called a co-founder of PayPal is not very interesting, and has very little to do with our broader discussion of whether Musk is a good steward for the “global public square” in the form of Twitter. That being said, it is interesting how important being recognised as a PayPal founder is to Musk. Some of his arguments are persuasive; if you buy into the view that PayPal could not have come about without X.com then the case for Musk as a co-founder is strong. But some of what Musk goes on to say in the Gawker interview is not very persuasive:


“PayPal, Inc., as people know it today, is not the company founded by Max and Peter. It was effectively created in Feb 2000 (formally consummated in March) when X, founded by me, acquired/merged with Confinity, founded by Max and Peter. The resulting corporate entity was still called X until 2001, when the board decided to sync up the name of the company with the name of the product.


Confinity was started in Dec 1998 as a Palm pilot cryptography company (crypto is one of Max's many skills) and Max came up with an application for the crypto that involved beaming money tokens from one Palm Pilot to another via the infrared port. The website where those payments could be reconciled and transferred to your bank account, which only went live to the public in Nov 1999, was paypal.com, but it was a far cry from the system you are familiar with today.


When I started X in Jan 1999 (formally incorporated in March 1999), the initial idea was to bring together a broad set of financial services in one seamless interface and then add special functionality, such as the ability to transfer money or securities instantly between account holders. However, when I showed the system to potential investors and beta customers, everyone was a lot more interested in email payments and not in the other stuff, so well before I had any idea what Confinity was doing, X shifted to an email payments focus.


That was the reason X and Confinity wanted to join forces. You say that X was a failed bank, but when did it even have time to fail, bank or no? Both the X and Confinity websites only went live in the last few months of 1999 and the first merger discussions started in Dec 1999.


Despite the shift to email payments in mid 1999, Mike Moritz asked that we talk to the press as though X was doing a bank. He was trying to avoid having other VCs fund email payments companies just because Sequoia was doing so, which I think made sense, but has resulted in a lingering misperception. This strategy is actually recorded in the X board minutes.”


The way Musk describes X.com as a payments platform first and bank second from the very start sounds odd. Why would a payments firm attract users to their platform by using index mutual funds as a loss leader? How does it make sense for a payments provider to intentionally deceive potential clients as to their core business just to avoid potential competitors getting venture capital funding? Musk’s later ventures have not kept features and plans secret to hamper competitors. Indeed, Musk would go on to be quick to announce features like Tesla’s full self-driving and the Cybertruck when they were several years away from being commercially available.


Besides, would it not make more sense for Sequoia and other venture capital funds to invest in several different digital payments providers to gain a diversified exposure to that business model? Given that the interview took place five years after PayPal was acquired by Ebay, one might see the interview as Musk trying to codify his version of history rather than as an objective account of what went down. Musk’s version of events makes him out to be the genius behind a now beloved service rather than a savvy business leader who recognises potential. Perhaps he is trying to be seen as a great inventor rather than a great business man. This whole discussion of X.com, the PayPal mafia, and who should be credited as a co-founder might sound like 25-year-old drama between Silicon Valley executives but it laid the foundation for the Myth of Musk as a modern-day Nikola Tesla; the outsider whose genius powers technological breakthroughs and who history will remember. Elon Musk was an inspiration for the Marvel Cinematic Universe’s and Robert Downey Jr’s take on the character of Iron Man who went on to become a pop cultural juggernaut in the 2010’s, and Musk had a cameo in the second Iron Man film. Musk’s reputation as the real world Tony Stark and the modern day Nikola Tesla is based on his successes in the late nineties internet boom, and compared to how the Myth of Musk frames these events reality looks disappointing.


Musk’s next great venture was SpaceX, a firm which had the modest goal12 to “make spaceflight routine and affordable, and to make humans a multi-planet species”. The company was founded in 2002 after Musk cashed out on PayPal and after he had gotten involved with The Mars Society13, an advocacy group founded in 1998 to advocate for, and help facilitate permanent human settlement on Mars. Through the Mars Society Musk met Michael Griffin who would go with Musk on a trip to Russia where Musk intended to buy Dnepr rockets, essentially Soviet R-36 intercontinental ballistic missiles converted to space rockets. Millionaire goes to Russia to buy decommissioned nuclear missiles sounds like the start of an early 2000’s Bond parody, but that was actually what happened. AirSpaceMag.com claims12 that Musk made three such trips, but ultimately no ICBMs were purchased. Instead, SpaceX decided to produce its rockets in-house.


SpaceX went on to have a rocky start14, until the firm was awarded a $1.5 billion contract from NASA for ‘Commercial Orbital Transport Services’ (COTS)15. The COTS contract made SpaceX a viable business rather than a vanity project, and it was none other than Michael Griffin, the head of NASA at the time, who decided to give the contract to SpaceX. Not to imply that SpaceX received the contract due to Musk’s personal connections, but the connections and positive reputation of having sold two tech companies can give material advantages. To editorialise for a bit: in a sense, wealth and success begets more wealth and outsiders ascribe the subsequent success to genius. In most fields we tend to think that a series of successes is proof of merit; one success could be a fluke but if a person does it several times in a row it is an undeniable sign of the person’s competence. But we are getting ahead of ourselves.


Musk is most famous for his revolutionary electric car firm Tesla. Truly only a once in a generation genius could successfully prototype and build an automobile which runs entirely on electricity, not to mention the immense creativity to come up with the concept in the first place. Except, as you may know, Musk did not in fact start Tesla, nor did he come up with the idea of manufacturing commercial electric vehicles. Tesla was started by Martin Eberhard and Marc Tarpenning in 2003, and Musk entered the picture in 2004 when he invested $6.5m in the company, becoming the largest shareholder and chairman of the board in the process. What is fascinating about Tesla is how different the reality of Tesla is compared to the stock narrative surrounding of the company. As slyly alluded to, the idea of an electric car is not new, and the first electric cars were actually built during Nikola Tesla’s, the Serbian inventor after whom Musk’s company is named, lifetime.


According to Musk in a 2009 blog post16 on Tesla’s website Tesla was started by Eberhard and Tarpenning to commercialise an electric concept car made by AC Propulsion called the Tzero. While Musk neither came up with the idea for making an electric sports car nor started the company he has certainly been a driving force at Tesla, and it would not be the company it is today without him. However, it is important to stress how Musk’s reputation and previous successes made his successes at Tesla possible. For example, in that same blog posts Musk states: “To save some money on real estate, we built the design studio in a corner of the SpaceX rocket factory and rapidly created our Model S prototype.” That may be brilliant businessmanship, but it is also not something just anyone can do. Had Eberhard and Tarpenning continued to run Tesla without Musk they obviously could not just move to their design studio to their rocket factory to save money. A lot of failed businesses could have gotten off the ground if their owners could simply move their firm into a corner of their rocket factory and had $70m to pump into a flailing company. It is also worth noting the tendency towards board room politicking in Musk’s companies. By 2008 both Tarpenning and Eberhard were gone from Tesla; Eberhard was ousted in 2007 and Tarpenning left soon after. There was a period of just under a year when Ze’ev Drori was CEO but by October 2008 Musk was installed as CEO17. This was not an orderly transfer of power, and Eberhard sued18 Tesla and Musk for libel claiming that Musk tried to rewrite history regarding Tesla’s inception. It’s not clear what exactly was in the lawsuit, nor the terms the parties eventually settled out of court19; but the mere fact that Musk still often and very publicly calls himself a co-founder it is reasonable to assume that Musk offered Eberhard enough financial incentives to get over his misgivings about Musk’s role in Tesla’s founding. A 2021 Forbes article20about the five Tesla co-founders notes that Eberhard mentioned a non-disparagement clause in the 2009 lawsuit when he declines to comment on Elon Musk. Musk reportedly called Eberhard “literally the worst person I’ve ever worked with” in 2020 according to the Forbes article.


Aside from the drama Tesla has done very well in terms of popularising electric vehicles and attaining high valuations, so it would be redundant to walk through the period of expansion between 2010 and now. This is not intended to be an exhaustive chronicle of Musk so we will instead focus on the less well known incidents that will be relevant to our discussion of Musk’s suitability as CEO and owner of the digital town square. The first incident worth paying attention to was Tesla’s 2016 acquisition of Solar City, a solar energy firm founded by Peter and Lyndon Rive in 2006. Solar City’s business model was centred on installing solar panels for households through a leasing agreement whereby the homeowner agreed to buy power generated by the panels through Solar City for 20 years in exchange for Solar City taking the costs of installing the panels. By 2015 Solar City was struggling with high costs and had to cut jobs. Luckily for Solar City during 2016 the company would not only get $90m from SpaceX purchasing its bonds21, it would also be acquired by Tesla for $2.6b. Why is this relevant to Musk? As it turns out, the Rive brothers have some famous relatives including their cousin, a certain Elon Reeve Musk. This looks quite bad, especially in context of how controversial Solar City’s business model turned out to be. By 2019 Solar City had been investigated by the Securities and Exchange Commission, the Treasury Department, and the Oregon Department of Justice, and it had also been involved in a forgery case21 in Oregon and had reportedly22 been operating without the proper permits in Vermont. It seems awfully convenient for Solar City to be bailed out by the company’s founders’ cousin while it was facing both cost issues and regulatory headwinds. According to Musk though, the Tesla master plan23 had always included solar power so the acquisition was a natural move. Here’s are Musk’s own words regarding the Tesla master plan in 2016:


“The first master plan that I wrote 10 years ago is now in the final stages of completion. It wasn't all that complicated and basically consisted of:

Create a low volume car, which would necessarily be expensive

Use that money to develop a medium volume car at a lower price

Use that money to create an affordable, high volume car

And...

Provide solar power. No kidding, this has literally been on our website for 10 years.

[…] We can't do this well if Tesla and SolarCity are different companies, which is why we need to combine and break down the barriers inherent to being separate companies. That they are separate at all, despite similar origins and pursuit of the same overarching goal of sustainable energy, is largely an accident of history. Now that Tesla is ready to scale Powerwall and SolarCity is ready to provide highly differentiated solar, the time has come to bring them together.” Reading through an archived version of the original 2006 Tesla master plan24 supports what Musk is saying: “This is because the overarching purpose of Tesla Motors (and the reason I am funding the company) is to help expedite the move from a mine-and-burn hydrocarbon economy towards a solar electric economy, which I believe to be the primary, but not exclusive, sustainable solution.” However, it also includes an interesting detail towards the end: “I should mention that Tesla Motors will be co-marketing sustainable energy products from other companies along with the car. For example, among other choices, we will be offering a modestly sized and priced solar panel from SolarCity, a photovoltaics company (where I am also the principal financier).”

 

To be clear, this issue has been raised by others and has been settled in a Delaware court case25 in 2022 which ruled in favour of Musk, but the case could be appealed. A 2019 CNBC article26 about the lawsuit states: “Investors were skeptical of the deal when Tesla proposed it in June 2016, with the stock plunging more than 10% on the announcement. According to the emails that have just been disclosed, Musk wrote […] a few months later, on Sept. 18, that to get investors on board, Tesla needed to get a handle on its liquidity problem and sign a letter of intent for a contract with Panasonic.


’Three things need to happen to change investor sentiment: SolarCity solving its liquidity crisis, an  [letter of intention] with Panasonic to address solar cell production risk, and a joint product demo,’ Musk wrote. ’Should be able to do all those before the shareholder vote.’” The article goes on to say: “The newly unredacted documents also provide details from Musk’s depositions. They show that he spent time berating the plaintiff’s attorney, calling him ‘reprehensible,’ ‘a bad human being,’ ‘a shameful person,’ and a ‘trickster.’ He asked if the lawyer’s only motivation in life was money, said he should rethink his life choices, and claimed that by representing the plaintiff, he was ‘attacking sustainable energy.’ […] ’I took everyone from solar and said, >>Instead of working on solar, you need to work on the Model 3 program.<< And as a result, solar suffered as you would expect,’ Musk said. ’That would include engineering, management, sales, service. Everything that could possibly be redirected towards the Model 3 program was so redirected. This was the right course of action for the company.’” A 2022 CNBC article26 cites the judge as saying: “Elon was more involved in the process than a conflicted fiduciary should be. And conflicts among other Tesla Board members were not completely neutralized. With that said, the Tesla Board meaningfully vetted the Acquisition, and Elon did not stand in its way.” You can make up your own mind on the Solar City affaire, but it is another example of Musk’s business relationships being too incestuous for comfort.

 

There are other examples of Tesla making strange and opaque business moves, like for example when it bought Bitcoin27 for $1.5b and announced that it would accept payment for its cars in Bitcoin, only to reverse course. When it sold28 a majority of its Bitcoin in 2022 it seems to have made a substantial loss on its trade. Another example is Musk infamously claiming that he had secured funding to take Tesla private in 2018, despite not actually doing so; causing a lawsuit29. Musk’s response to the lawsuit included the passage: “This unjustified action by the S.E.C. leaves me deeply saddened and disappointed. I have always taken action in the best interests of truth, transparency and investors. Integrity is the most important value in my life and the facts will show I never compromised this in any way.” Remember this statement when we get to chapter 4. The suit ended in a settlement30 which forced Musk to step down as Tesla’s chairman and he had to agree to implement controls to oversee his communications. Musk then tweeted that Tesla would make half a million cars in 2019 which landed him back in court31. The case finally appears to be settled with a jury finding32 Musk not guilty in 2023. There are of course more controversies involving Musk, like the “pedo guy” remarks, or the time he smoked cannabis on the Joe Rogan Experience, or how often he flies by personal jet for someone who fancies himself a climate hero, or how Tesla’s full self-driving technology was supposed to be ready by the end of 2017 but still is not commercially available, or the allegations that racism and sexual harassment is common at Tesla. Musk creates controversy wherever he goes, and often intentionally so. Is that someone who should be in charge of a neutral public square? Before we get to that and the overall verdict on ‘the man’ let us briefly discuss Musk’s philanthropy.

 

Like many of the ultra-wealthy Musk has a philanthropic foundation, the Musk foundation33 which was founded in 2002. As you might expect, a lot of what the Musk foundation is focused on is related to science, space, and education. True to his values Musk gives to charities like the Planetary Society, the Mars Society, and the Federation of Galaxy Explorers. That is not to say that the Musk Foundation only donates to space charities, most of the donations are for more general charity like healthcare and education in the US and abroad or for climate change mitigation efforts and wildlife conservation. It has also made some political donations over the years, including helping to fund the 2008 Democratic Party convention in Denver. The Foundation has also supported less explicitly party political charities and think-tanks like the Cato Institute in 2008, Citizens Against Government Public Waste in 2006, and the Transgender Law Center in 2012. From the donations made by the Musk Foundation between 2002 and 2020, the last year for which figures are available, you get the sense that Musk’s political views are more progressive with a focus on the climate and a hobby horse in space travel. Broadly what you would expect from the real life Iron Man persona Musk was associated with for a time. There were two main reasons for going through the Musk foundation’s donations; firstly, to find out how well Musk’s professed beliefs lines up with his actions, and secondly to see if Musk’s charitable giving has changed over time. On the issue of living up to his beliefs Musk is doing well. He has consistently advocated for decarbonisation of the economy and better climate laws and has been consistently funding groups which are focused on combatting climate change. He has also been a vocal proponent of more investment in space exploration with the ultimate goal of making humanity an interplanetary species, and that is certainly reflected in his charity. Musk has also warned about the threat that artificial intelligence could pose, and he started funding groups seeking to make sure artificial intelligence is developed responsibly in 2018. While none of these beliefs are directly related to Twitter, social media, or free speech it reflects well on Musk to put his money where his mouth is. And his funding for the Wikimedia Foundation, which runs Wikipedia, could be read as supporting if not freedom of expression, at least the ability to access information for free.


Let us return to where we began. What kind of man is Elon Reeve Musk? Is a person like him well suited to running a social media site? Should a man like Musk be entrusted with the global public square where topics vital to the future of humanity are discussed? After the deep dive into Musk’s early career it is clear that any claim that he is an unrivalled genius is wrong. Musk has clearly worked hard to cultivate a certain image, often settling lawsuits out of court to maintain that image. At the same time, he is undoubtedly a successful businessman though contrary to popular belief his main business is not cars or rockets, but hype. That is not to say that he is not committed to Tesla or SpaceX; just not committed enough to focus on a single firm. Committed to decarbonising the economy, but not committed enough to give up his private jet. Committed to free speech on Twitter, just not committed enough to leave his critics unbanned. He collects CEO positions like Pokémon gym badges, and seems to get caught up in corporate politics at all his companies. He moves fast and breaks things, sometimes that is the status quo in the automobile market and sometimes it is federal securities laws. Quantity famously has a quality of its own, and Musk has a large quantity of CEO positions, successful start-ups, and initial public offerings on his resumé which makes him an attractive person to invest with. If you think that Twitter is mainly a company — one which happens to run a social media platform sure, but a normal company nonetheless — then Musk seems like a great new owner. He has a history of buying companies on the cheap and selling them for far more down the line, often being credited with revolutionising an industry in the process. Who would not welcome a serial entrepreneur coming in to disrupt the status quo in social media? On the other hand, if you genuinely believe that Twitter is more than a dolled-up data collection scheme meant to give its users more relevant ads, then Musk taking over is a nightmare. If you believe that Twitter is the de facto global public square then you should be worried that a man who has a tendency to overpromise and underdeliver on Tesla’s products and features is now heading up Twitter. Ultimately, the myth about Elon Musk’s success being a product of pure merit is just that, a myth. Musk’s success comes from a strong and hard earned reputation and connections with venture capitalists from his dotcom bubble days. There is nothing in his background which would make him particularly unsuited to the job of running Twitter except his instinctive need to control the narrative surrounding him and his businesses, and as bad as his behaviour as the CEO of Twitter has been in terms of banning critics and journalists34 he has at least been consistent with only being interested in discussions about himself. The man is not a heartless villain nor a completely selfless hero. No one is. But he also clearly does not have the temperament needed to be a steward of the public square. His penchant for trolling and his habit of tweeting first and asking questions later further makes him a poor pick as Twitter’s CEO. So with that in mind let us finish the chapter with this question: why did we let a single mercurial individual take over Twitter when his biography suggests that he is not a suitable candidate?



Next Chapter: The Bird



ree

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The Introduction

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The Man

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