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Former Twitter India head says microblogging platform likely to double down on India under Musk

Twitter signed a definitive agreement on April 25 to be acquired by an entity wholly owned by Tesla CEO Elon Musk in a $44 billion deal. Once the deal is closed, the company that went public in 2013 will become private subject to Twitter shareholders and regulatory approvals.

April 27, 2022 / 09:23 AM IST

Manish Maheshwari, founder and CEO of Invact Metaversity and former Twitter India head, believes India will continue to be an important market to drive user growth for Twitter amid questions on the priorities of its new owne, billionare Elon Musk. According to him, the firm is likely to double down on the country and other emerging markets.

Twitter signed a definitive agreement on April 25 to be acquired by an entity wholly owned by Tesla CEO Musk in a $44 billion deal. Once the deal is closed, the company that went public in 2013 will become private subject to Twitter shareholders and regulatory approvals.

Maheshwari said that India is important because every company wants to grow their daily active users.  “Because of its size no company can ignore India from a growth perspective. So in my view, they (Twitter) will double down on India and other emerging markets and try to achieve growth,” he said.

The company has seen significant growth over the last few years. Twitter’s largest user base is the US, with 76.9 million users followed by Japan at 58.95 million, and 23.6 million users in India, according to market intelligence firm Statista.

Despite this potential, given Twitter’s run-in with the Indian government, and Musk’s mercurial personality, it is not clear how the Tesla boss's free speech claim will pan out. Maheshwari did not comment on the impact this might have on India operations.

Close

In addition, the acquisition has raised several questions around its India operations and impact going forward.

Twitter acquisition

From accumulating shares as a passive shareholder in January 2022 to eventually owning the platform, the sequence of events has come as a surprise.

“It did come as a surprise until April, but after that it was very clear,” said Maheshwari.

Explaining what could have caused this, he explained, “The genesis of this idea could have taken place when Jack (Dorsey, co-founder, Twitter) left the firm (last year) because Jack and Elon are quite close. When I was on Twitter, we used to have this one team meeting, where Elon used to be invited to address the employees.”

The closeness was evident in the tweet, where Dorsey said that while he does not believe that anyone should own Twitter, but “Elon is the singular solution” he trusts to solve the company’s problem.

As Musk looks to take the company private, there are several challenges that are facing the firm and its new owner.

Challenges

After the regulatory approvals fall in place, retaining key employees in the firm is going to be a key challenge. Given that this is a major change, employee churn is likely to happen as well.

“You will have to give that confidence and security to people that everything is not going to change overnight,” he said.

Also, while Musk is known for turning around businesses, he has not handled social media before, and hence this would be new for him. Twitter, unlike other firms, is mission driven, and is relatively small. “If you make too many changes, and users don't like it, that could create a negative spiral there. That will limit the ability of someone to make too many changes quickly. So, one has to tread carefully,” he added.

According to experts, with the company moving private, it would give Musk enough room to make changes without public scrutiny.

However, according to Maheshwari, monetisation might not be an immediate priority for the firm. “It (Twitter acquisition) is much more of an ideological buy versus a financial decision at this point in time. So monetisation, in my mind, is not going to be an immediate concern, because what will happen first is growth. Once you have executed and driven enough growth you then go about other things,” Maheshwari explained.

Who will lead the firm? 

Parag Agrawal, who took over as CEO in November 2021, will continue in the role till the deal is closed. Considering that Musk has already raised concerns over management, it is not clear if he could continue in the role.

Maheshwari said, "My view would be yes, there would be management changes. That's what I foresee. Because the very nature of making it private and sort of executing at a different pace will require reorganisation. That would mean management changes -- how much and who will impact that I can't say."

 



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Swathi Moorthy
first published: Apr 27, 2022 09:23 am
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