Elon Musk said that changes were required to prevent Twitter from going bankrupt.
Twitter’s Chief Executive Officer Elon Musk said that the employees will receive stock-based awards at a valuation of close to $20 billion, according to a report in the Wall Street Journal. This is less than half of the $44 billion spent by Mr Musk to acquire the social media platform in October last year.
Mr Musk expressed optimism about the social-media company’s future in a statement to employees. “I see a clear, but difficult, path to a >$250B valuation,” he stated, implying that shares awarded now would be worth ten times more.
In the email reviewed by the outlet, Mr Musk added that Twitter is witnessing changes so rapidly to ensure that the company “can be thought of as an inverse startup.” According to the email, he said that significant changes were required in part to prevent Twitter from going bankrupt.
According to a separate email sent to the employees on Friday, the company informed its staff that it is providing additional equity grants to employees, which will begin to vest after six months. It further said that the company intends to offer a liquidity event in around a year during which time employees will be able to cash out some of their equity. However, it is to be noted that no information was available regarding the number of employees who will get equity awards.
Also Read: “Office Is Not Optional”: Elon Musk Emails Twitter Employees At 2:30 AM
Since Mr Musk’s contentious acquisition of the microblogging site last year, employees have had a lot of questions, including ones about compensation. According to former employees, Twitter frequently provided stock grants as part of employee pay that vested over time, the outlet noted.
The new grants, which are separate from and in addition to any legacy Twitter equity that was converted to cash at the time of the acquisition in October 2022, will vest over a four-year period, as per the email.
According to regulatory filings, Twitter had spent roughly $630 million on stock-based compensation in 2021, the last full year it publicly declared financial results before going private.
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