What Elon Musk does on Twitter is what he did at Tesla and SpaceX

Elon Musk was sleeping in the office. He fired employees and managers at will. And he lamented that the company was on the verge of bankruptcy.

It was back in 2018, and the company was Tesla, as Musk’s electric carmaker struggled to create the mass-market Model 3.

“It was unbearable,” he told The New York Times. “There were times when I didn’t leave the factory for three or four days – days when I didn’t go out.”

What the billionaire called Tesla’s “production hell” became the blueprint for the meltdown at Twitter, which he bought last month for $44 billion. Over the years, Musk has developed a playbook for steering his companies, including Tesla and rocket maker SpaceX, through painful times, using shock therapy and sounding the alarm and forcing employees and himself to put all their energies aside from family and friends. his mission.

On Twitter, Musk used many of the same tactics to elevate the social media company in a matter of weeks.

Since late last month, the 51-year-old has laid off 50% of Twitter’s 7,500 employees and accepted the resignations of 1,200 or more. On Monday, he began another round of layoffs, the two people said. He wrote on Twitter that he was sleeping in Twitter’s offices in San Francisco. And he used mission-driven language, telling Twitter employees that if he couldn’t change it, the company could fail. Those who want to work on “Twitter 2.0” must commit to its “hard core” vision in writing, he said.

David Deak, who served as Tesla’s senior engineering manager overseeing the supply chain for battery materials from 2014 to 2016, said Musk “clearly thrives in existential conditions.” He added: “He creates them to light a fire under everyone.”

Santa Clara University management professor Tammy Madsen added that the similarities between Musk’s approach to Twitter and what he has done at Tesla and SpaceX are obvious. But it’s unclear whether he’ll find the means to motivate workers at the social media company, as he has done with workers who want to move people away from gas-powered cars or send people into space.

“The approach at Tesla and SpaceX has always been high risk, high reward,” Madsen said. “Twitter was high risk, but the question is: What is the reward from it?”

Musk did not respond to a request for comment.

On Sunday, Musk held a meeting with Twitter sales staff, two people with knowledge of the matter said. Then on Monday, he laid off employees in the sales department, they said. Late last week, Musk fired his top sales manager, Robin Wheeler. Bloomberg previously reported that more layoffs may be possible.

Twitter has also reached out to some of the engineers who quit to ask them to come back, the people said. In a meeting with employees on Monday, Musk said the company did not plan to make more layoffs, according to a person involved.

In the companies led by Musk, the model claiming that the firms are on the verge of potential bankruptcy has often come up. In December 2008, at Tesla, in the depths of the financial crisis, Musk closed a $50 million investment round from Daimler, which he said was “possible in the last hour of the last day, otherwise the salary would have come back 2 days later.”

He said the same thing about SpaceX, once noting that both SpaceX and Tesla had a better than 90% chance of being “worth $0” in their early days.

In 2017, Musk said SpaceX had to launch rockets once every two weeks or face bankruptcy, recalled a former SpaceX executive who spoke on condition of anonymity for fear of retaliation. The former executive said the threat of bankruptcy was a motivating factor at the company, which aims to make life “multi-planetary”.

SpaceX has since successfully sent many rockets into space and landed them safely back on Earth. But Musk returned to his favorite stick, tweeting last year that if a “severe global recession” dried up capital, the rocket maker’s bankruptcy was “impossible.”

“Only the paranoid survive,” he wrote, quoting former Intel CEO Andy Grove.

According to two former Tesla executives, the atmosphere of crisis and self-imposed austerity gives Musk the opportunity to make sweeping changes and fire top executives or lay off large numbers of staff. It also prepares those left to work in extreme conditions to carry out Musk’s wishes, they say.

At Twitter, where Musk has cut thousands of jobs, the approach is “typical Elon,” Deak said.

Some of Musk’s former employees question whether his management tactics will ultimately work at Twitter. Tesla and SpaceX were in the early stages of growth when their boss stuck out his tongue and told everyone they needed to go full tilt. But Twitter is a more mature company that has had inconsistent performance for years.

Musk’s management methods are “a good start-up and growth strategy, but not good for building a stable company,” Deak said.

According to three former Tesla and SpaceX executives, Musk’s all-out commitment to the company is often inspiring, but it can also be toxic and create a culture of fear and scapegoating.

And for Musk, rebuilding Twitter is only a part-time job. He remains CEO of Tesla and SpaceX, which he says he continues to lead in court, where he focuses more on designing rockets than managing them.

Musk also has Boring Co., which has a tunnel project. and leads brain-computer interface technology firm Neuralink. He said his long-term goal was to save humanity by developing the technology for space travel, or, as he put it, “making life multiplanetary to ensure the long-term survival of consciousness.”

Multiple positions have become an issue in a lawsuit filed by Tesla shareholders challenging the pay package that made Musk the world’s richest man. Questioned last week by a lawyer representing shareholders in Delaware, who accuse Musk of neglecting his duties at Tesla, the billionaire said his heavy presence on Twitter was temporary.

“There has been an initial burst of activity to reorganize the company,” he said, adding, “I expect to reduce my time on Twitter.”

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