I don't think it's that crazy. Private Equity and Wall Street doesn't have pressure for resilience, it has pressure for churn. As long as revenue and spending... exists... things are fine. Ideally they are numbers that grow. This doesn't lend itself to clearing out a development backlog, or engineers doing the most important things, it lends itself to rapid iteration and justifications for the iterations.
So now that it is owned by someone that doesn't need churn and just needs to reduce cost, people can focus on discreet resilience factors, just like any small tightly held software operation. Many of Twitter's pet projects go away, the ad sales relationship have to get re-evaluated too, but the core consumer product that everyone sees can be made resilient and operate cheaper.
The problem is that it’s run by someone who overpaid badly and needs to come up with significantly more money to pay for the debt he saddled the company with, and then his actions seriously disrupted ad revenue. That puts him more in the PE playbook of cutting costs as deeply as possible even at the extent of long-term growth. Unlike his other companies there isn’t strong government support to drive business for Twitter.
He's going to sell Tesla shares to pay off his debts, he's knocked off $4 billion already, he'll be able to keep doing that, make offers to buyout stakes of Twitter from people that really don't want to be involved in this shit show. Twitter will operate at lower costs, and also not be profitable for him given current information. That's financially fine.
The banks probably took convertible debt at high interest rates, but who cares about high interest rates when it's only been one month. He probably has a clause for accelerated payments, because its debt, not shares yet.
(after a certain amount of time, or upon default, the debt would convert to shares. but it can be much more complicated, and onerous than that too. lending can be fun.)
Musk has been in a similar position before when he took over Tesla. At that point it was struggling to make the Roadster, they were facing having a marginal cost of manufacturing a car higher than the sales price.
Musk took over and made cuts. I don't think anyone could argue that those cuts were at the cost of Tesla's long-term growth. They were needed because of an imminent liquidity problem. Tesla has hired great people since then.
> Private Equity and Wall Street doesn't have pressure for resilience, it has pressure for churn. As long as revenue and spending... exists... things are fine. Ideally they are numbers that grow. This doesn't lend itself to clearing out a development backlog, or engineers doing the most important things, it lends itself to rapid iteration and justifications for the iterations.
Did we read the same article, because it seemed clear that all that resilience work was done when the company was public shareholder owned, not under the new private owner.
I read the article, I wanted to use the space to point out that Elon's fortunate that it has been done, and also that the technology infrastructure things he needs to focus on aren't impossibly challenging to do, if people are expecting it to be.
So operating Twitter with 80% fewer engineers isn't the voyeuristic suicide that many of us are hoping to be amused by.
So now that it is owned by someone that doesn't need churn and just needs to reduce cost, people can focus on discreet resilience factors, just like any small tightly held software operation. Many of Twitter's pet projects go away, the ad sales relationship have to get re-evaluated too, but the core consumer product that everyone sees can be made resilient and operate cheaper.