Analysis: Twitter's TKO Of Elon Musk To The Board

Zinger Key Points
  • "I believe this is for the best," said CEO Parag Agrawal.
  • Musk has yet to comment on what transpired.

Sunday night’s announcement by Twitter TWTR CEO Parag Agrawal that Elon Musk turned down the invitation to serve on the company’s board of directors should not have been a surprise to anyone who is vaguely familiar with the social media giant or the Tesla TSLA chieftain. Over the past several days, Twitter and Musk engaged in a public battle of wills that Musk lost in a spectacular crash.

Sorry, Not Sorry: The fact the announcement came from Agrawal and not Musk is primary evidence that Musk came up against a force that he could not bulldoze. The language in Agrawal’s announcement made it clear that Musk was the wrong man for the director’s job.

“Elon Musk has decided not join our board. Here’s what I share about what happened,” Agrawal tweeted.

From the first sentence, Agrawal made it clear Musk blinked and that the decision was not a mutual agreement. Musk’s millions of social media followers have long championed that he can do anything he puts his mind to doing, which makes Agrawal’s statement all the more jolting.

“We were excited to collaborate and clear about the risks,” Agrawal continued — but the emphasis on “the risks” seemed very peculiar. After all, when was the last time a company announced the appointment of a board member while stressing the new director carried “risks.” Agrawal also emphasized that Musk’s board membership meant he “has to act in the best interests of the company and all of our shareholders” — really, how often does language like that pop up in discussing a new board member?

“We announced on Tuesday that Elon would be appointed to the Board contingent on a background check and formal acceptance,” Agrawal added. But why was this sentence included? It's standard practice for any company to conduct a background check on a potential board member — did Agrawal intentionally include this to raise doubts that Musk was hiding something that could emerge and embarrass him? That seems strange, considering the surplus amount of attention he’s received in recent years. If there is the proverbial skeleton in Musk’s closet, he’s done a remarkable job in hiding it.

See Also: Move Over, Elon: 5 Unlikely Celebrities Who Served On Corporate Boards

The Sounds Of Silence: “Elon’s appointment to the board was to become effective 4/9, but Elon shared that same morning he will no longer be joining the board,” Agrawal continued. However, Agrawal did not share the news until the evening of April 10 — why didn’t Twitter announce this on April 9?

The answer is rather simple — Agrawal and the Twitter communications team waited to see if Musk would make an announcement of his plans. After more than 24 hours passed without Musk saying a word, Agrawal framed the news as he saw fit, with Musk maintaining an uncharacteristic silence.

And then, Agrawal closed the Musk misadventures around the Twitter boardroom by stating, “I believe this is for the best.” This might be the first time that a Fortune 500 chief executive publicly thanks an individual for refusing to take a board seat.

Musk posted a single emoji after Agrawal's tweet that featured a smiling face with a hand over its mouth, according to Bloomberg; the tweet was deleted hours later and all of the earlier tweets Musk made in connection to Twitter have also been deleted.

What Wasn’t Said: Yet Agrawal conveniently omitted something from his announcement — according to a report in TheStreet.com, he was arranging an “Ask Me Anything” gathering with Musk taking questions from the Twitter workforce. In an internal e-mail sent on Thursday, Agrawal told his workforce, “Following our board announcement, many of you have had different types of questions about Elon Musk, and I want to welcome you to ask those questions to him.”

For all of his brilliance in putting himself front and center in the public eye, Musk has conveniently avoided sitting down for intensive Q&A sessions — his last major interviews involved Time Magazine's glowing "Person of the Year" tribute and a softball video conversation with the leadership of The Babylon Bee news satire website, both from December.

The “Ask Me Anything” session with Twitter’s employees was not a requirement for board membership, though Musk’s reluctance to open himself to potentially rude questions — perhaps Tesla's operations in the Xinjiang region where China’s government has centered its human rights abuses against the Uyghur minority — clearly contributed to Agrawal’s “I believe this is for the best.”

See Also: Elon Musk Says Robot Production Could Start In 2023

No Common Ground: For anyone paying attention to Musk-Twitter duet, it was obvious from the beginning that this was a ridiculous mismatch. When Musk used his Twitter page to ruminate about the social media platform failing to meet “free speech principles,” Twitter’s communications team issued a statement that its “policy decisions are not determined by the Board or shareholders, and we have no plans to reverse any policy decisions.” Obviously, both parties were on parallel tracks, with neither eager to find common ground.

Prior to his withdrawal, Musk banged out tweets that included the suggestions Twitter’s San Francisco headquarters be turned into a homeless shelter, that Twitter Blue subscribers be able to pay in Dogecoin DOGE/USD — never mind that Tesla buyers cannot use Dogecoin for their purchases — plus the smutty idea that Twitter remove the “W” from its name. Twitter’s public-facing communications team ignored Musk’s tweets, which gave the impression of someone increasingly eager to call attention to himself rather than make a corporate change for the better.

Still, Musk remains Twitter’s largest shareholder for now and it's unlikely he will stop playing provocateur at Twitter’s expense. But at the end of the day — or, in this case, the start of a new trading week, he is not calling the shots at Twitter. And as Agrawal bluntly stated in his Sunday announcement, “There will be distractions ahead, but our goals and priorities remain unchanged. The decisions we make is in our hands and no one else’s. Let’s tune out the noise, and stay focused on the work and what we’re building.”

Twitter Trading Action: Twitter shares were down about 2% to $45.31 in Monday’s premarket trading.

Photo: Telenovelas Foto / Flickr Creative Commons

Posted In: board of directorsElon MuskParag AgrawaltwitterNewsMovers & ShakersManagementOpinionTop StoriesGeneral

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