Mush purchased the app and renamed it X. While he did use a huge amount of his wealth to cover the massive $44B costs in 2022, a list of investors and bank loans went a long way to achieve the financial objectives.
During that era, many were in awe of Musk who managed to attract dozens of leading investors worldwide. Musk was given two thumbs up regarding his leadership skills and many praised him for his confidence in taking on this decision. However, it appears that they might have spoken too soon.
Some might be still happy with the investment while others feel the deal was a huge mistake to begin with. Investors are not happy with the way things have turned out for Twitter, now X. The company’s valuation is nowhere near what it used to be, and clearly, things went downhill quickly.
The end result is investors losing out on billions. Thanks to a new analysis by The Washington Post, the eight top investments reported by the US are today worth a staggering $5B less than what they were at the time.
It would not be wrong to mention that Musk’s intervention to make Twitter better with his ideology of X failed. Many experts now agree that Twitter should have never been in the hands of Elon Musk, to begin with.
The company’s main means of generating revenue was advertising. After seeing Musk’s controversial decision-making skills and opinionated beliefs, most advertisers fled. Hence, the goal for Musk and executives right now is to make monetization a top priority.
It’s hard to get a clear financial picture of where the company stands today as it’s a private firm. But there are a few things that are now crystal clear: the current stance of some of the biggest investors and how much they differ from that seen in the past.
Let’s begin with the tech billionaire himself, Elon Musk. He began with $33.5B which came from his own personal wealth combined with Tesla’s shares. Today, it’s worth $9.38B so it’s a drop of $24.1B.
Next, Prince Alwaleed bin Talal from the Kingdom Holding Co. invested $1.8B, and today the valuation is $529M. The losses incurred are close to $1.36B. Out of all the investors, he’s the most optimistic as he continues to see X prosper in the future.
Jack Dorsey who was Twitter’s co-founder and the ex-CEO invested $1B and today that’s worth just $280M. The losses incurred are close to $720M. In case you’re still wondering, he regrets Musk's decision to purchase Twitter.
Larry Ellison who is Oracle’s co-founder and chairman of the board invested $1B which is today worth $280M. Losses incurred are roughly $720M, again not a great decision. Meanwhile, Sequoia Capital’s investment was $800M and that stands at $224M today. The losses incurred are $576M.
Moving on to Vy Capital, investments included $700 which are today worth just $196M. Losses incurred are $504 million. While Binance was excited to invest $500M and bring Elon Musk’s vision to life, they stand at just $140M with losses hitting $360M.
Andreessen Horowitz invested $400M in the company but incurred $288M worth of losses as their valuation stands at $112M today. Last but not least, the Qatar Investment Authority invested $375M whose value has declined by $270M to reach just $105M. While the company’s head showed support for Musk in 2023, we’re not quite sure if he will be too happy with the current stance of the firm.
With the majority, if not all investors underwater, this is not the picture that Musk would have liked to show the world. The reality is Elon Musk’s uptake of Twitter has caused a huge amount of wealth destruction.
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by Dr. Hura Anwar via Digital Information World
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