Twitter CEO Seeks to ‘Back Back’ in Elon Musk Takeover Battle

Twitter’s $44 billion takeover has been marked by public clashes between two executives with very different styles: the brash and outspoken billionaire Elon Musk, and the social media company’s more measured and diplomatic boss, Parag Agrawal.

Musk publicly goaded Twitter’s lesser-known leader on the social media platform and repeatedly threatened to back out of the deal, citing concerns about his fake account data.

Backed into a corner less than a year into his term, the enigmatic Agrawal is starting to fight back in front of employees and the public, according to several current and former employees who spoke to the Financial Times on condition of anonymity.

“Parag wants to push back further and is being more aggressive internally,” said a former Twitter executive. “It looks like Twitter is willing to go to war to make this deal happen.”

Behind closed doors, navigating the relationship seems less tense. The two interact weekly in discussions that are more relaxed than antagonistic, according to people familiar with the situation. They are naturally aligned on numerous issues about how the company should be run, two people said, including the need to diversify revenue, build a larger audience and even relax moderation rules to get away from permanent bans.

However, Agrawal’s critics are skeptical about how effective he would be as an untested leader against an unpredictable opponent. Many cite the 38-year-old’s lack of leadership experience and the fact that his negotiating hand will weaken if Twitter’s business begins to deteriorate, given the uncertainty.

“Parag is in an impossible situation,” said Brian Wieser, GroupM’s global president of business intelligence. “We still don’t know how serious Elon is many months later, but the company has committed to the sale.”

Agrawal, born in India, has risen through the ranks at Twitter over the past decade and was named chief executive in November after four years as chief technology officer. He joined after graduating with a Ph.D. from Stanford University, interspersed with research internships at Microsoft, Yahoo, and AT&T.

As the company’s first “distinguished engineer,” a title that confers significant status in elite engineering circles, his intellect has earned him respect within.

“My experience with Parag was that I was impressed with his command of detail and his extensive understanding of issues that other leaders would miss,” said Bruce Daisley, Twitter’s former European vice president.

Emulating Silicon Valley founders like Steve Jobs and Mark Zuckerberg, the soft-spoken Agrawal wears the same outfit to work every day: a black T-shirt and dark blue jeans, in keeping with the dogma that minimalism breeds productivity. additional. At a private dinner for tech executives hosted by Salesforce boss Marc Benioff in May, Agrawal took the floor to defend himself, according to two people familiar with the situation. Impressed guests later lined up to speak with him, one person said.

Unlike his predecessor as CEO, quirky founder Jack Dorsey, Agrawal is more of an unknown quantity beyond the walls of Twitter and exclusive Silicon Valley dinner parties, making few public appearances and making little use of the platform itself during his first months in office.

“Parag feels more like an engineer who has been put in charge of a product than someone who has a vision,” said an advertising agency executive. “Twitter needs a leader to stand up and make Twitter a presence in the marketplace.”

As a result, he has faced skepticism from some board members, particularly because of his lack of experience as head of a public company or leading large teams. According to several people, the board opted to implement a poison pill early in the negotiations to buy time, in part to better understand Agrawal and his business plan for Twitter, and also to consult with investors.

Some investors expressed concern about whether Agrawal could successfully carry out his plan and were therefore inclined to accept a deal, two people said.

The board also discussed whether to allow Musk to make his offer directly to shareholders, but rejected that option in favor of negotiating the terms of the deal and deliberately building in some defenses and protections so that Musk doesn’t change his mind.

Agrawal and other board members have publicly expressed that they want to go ahead with the deal at the price of $54.20 per share, as agreed with Musk. The San Francisco-based company has told employees it expects to hold a shareholder vote on the deal in early August.

But that could still prove challenging. Musk has disputed Twitter’s estimate that less than 5 percent of accounts on his platform are spam, threatening to abandon the deal if it can’t be proven. The move has been interpreted by Twitter pundits and employees as the Tesla boss seeking leverage in the negotiations or an excuse to try to cancel the deal altogether.

Last month, Twitter agreed to allow Musk access to the “fire hose” of publicly available data on tweets that it normally sells to social media monitoring companies, a move some saw as Agrawal calling out Musk’s bluff.

“The opening of the [data trove] it’s a classic Parag move to show ‘we’re not going to blink, we have nothing to hide,’” said another former Twitter executive.

But on Thursday, The Washington Post reported that Musk’s team had concluded the data was unverifiable, raising questions about his next move.

So far, Musk has not directly mentioned renegotiating the terms of the deal with Agrawal, according to a person familiar with the situation and confirmed in an email by Musk. Twitter declined to comment.

Agrawal’s success may depend, in part, on whether he can keep the business in sound financial health so as not to give Musk leverage in negotiations.

Twitter has been criticized for slow growth, slow product innovation and a struggling advertising business amid a broader market downturn. Its revenue in 2021 amounted to $5 billion compared to Facebook-owner Meta’s sales of $118 billion. In its latest quarterly earnings, the company admitted to exaggerating its viewing figures by almost 2 million users for about three years.

After an initially low-key start, Agrawal has been more present in the office a few days a week, three people with knowledge of operations said, taking a recent tour of several global headquarters. Her attention has been focused on overhauling Twitter’s management structure to encourage better performance and faster product launches in areas like commerce.

In May, it decided to freeze hiring and implement cost-cutting measures. He also fired two popular senior leaders in charge of ads and products, surprising some employees, though others noted the moves came after user and revenue goals were missed.

He has been frank with staff rather than trying to reassure them, an approach that has won over longtime loyal employees but unsettled new ones, several employees said.

If the deal goes through successfully, Agrawal will most likely be out of a job as Musk plans to replace him, according to media reports.

Still, Agrawal has multiple incentives to go through with the deal, beyond saving face and avoiding any potential escalation to court. He would walk away with a $60.1 million golden parachute if he were fired as part of the takeover, according to regulatory filings.

On the other hand, if the sale collapses, it could be tasked with reviving a company with a crushed share price and low employee morale.

They are hanging over a void. ‘Cause if the deal falls apart, stocks will crash [and] so you’re seeing significant headcount reductions, having to cut back,” said a former executive.

Another former executive said he believed Agrawal was willing to be a “sacrificial lamb” for the company.

Additional reporting by Cristina Criddle in London

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