Twitter’s new CEO Parag Agrawal has appointed Elon Musk to the board, after the billionaire tech entrepreneur was revealed as the platform’s largest shareholder yesterday.
Based on Friday’s market close, Musk’s 9.2 per cent stake is worth some $2.89bn (£2.2bn), though just a fraction of his net worth of $233bn (£178bn).
“He’s both a passionate believer and intense critic of the service which is exactly what we need on Twitter, and in the boardroom, to make us stronger in the long-term,” the CEO tweeted.
In response to Agrawal’s initial tweet, Musk wrote: “Looking forward to working with Parag & Twitter board to make significant improvements to Twitter in coming months!”
Analysts have pegged Musk’s significant stake as a sign of changing winds over at the Big Tech firm, with Musk polling his followers on introducing an edit button today being his latest move to weigh on analyst predictions.
Senior investment and markets analyst at Hargreaves Lansdown, Susannah Streeter said the appointment may “lead to some nervousness about Mr Musk getting too much influence about the way Twitter is run, with a view to bolstering his own personal brand and that of his companies.
“Although his involvement has already sparked a share surge with expectation that it could lead to higher levels of participation on the platform, over the longer term Twitter investors will want to see that high levels of governance are adhered to, otherwise the independence of Twitter could be questioned, and the risk is that users may start to drift away.”
Technology and media analyst at PP Foresight, Paolo Pescatore told City A.M. yesterday that Musk taking a considerable bite into Twitter is a strong statement of belief in the platform.
“While this feels out of the blue, Musk is further diversifying his empire,” he said. “It does raise into question recent comments and whether the move is seen as a means to influence the company and future strategic approach. It is apparent that the stake raises more questions.”
Musk has carved out a name for himself for being particularly vocal on Twitter. The billionaire pitched to his 80.2m followers just weeks ago whether a “new platform” is needed and pointed towards the importance of his poll, for reasons unbeknownst to users.
The Tesla boss tweeted: “Given that Twitter serves as the de facto public town square, failing to adhere to free speech principles fundamentally undermines democracy. What should be done?
“The consequences of this poll will be important. Please vote carefully.”
In late January, Musk also expressed annoyance towards Twitter spending “engineering resources” on a new crypto feature allowing users to have NFTs as profile pictures.
The steps towards crypto products signals a blue bird under pressure to haul in newer, more sparkly products as its share price growth lags behind that of its peers. The platform’s share price has dwindled more than a third over the past year, according to Simply Wall Street.