Let that sink in!’
Mr.
Musk arrived at Twitter’s San Francisco offices on Oct. 26, toting a
white porcelain sink through the glass doors of the building. “Let that
sink in!” he tweeted at the time, along with a video of his grand entrance.
Leslie
Berland, Twitter’s chief marketing officer, encouraged employees to say
hi to Mr. Musk and escorted him through the office. He was seen
chatting with employees at the company coffee bar.
But the vibe quickly changed. The next day, Parag Agrawal,
Twitter’s chief executive, and Ned Segal, the chief financial officer,
were in the office, two people familiar with the situation said. Once
they knew Mr. Musk’s acquisition of Twitter was closing that afternoon,
they left the building, uncertain what the new owner would do.
Mr.
Agrawal and Mr. Segal soon received emails saying they had been fired,
two people familiar with the situation said. Vijaya Gadde, Twitter’s top
legal and policy executive, and Sean Edgett, the general counsel, were
also fired. Mr. Edgett, who was in Twitter’s offices at the time, was
escorted out.
That
evening, Twitter hosted a Halloween party called “Trick or Tweet” for
employees and their families. Some workers dressed in costume and tried
to keep the mood festive. Others cried and hugged one another.
Mr. Musk had brought his own advisers,
many of whom had worked at his other businesses, such as the digital
payments company PayPal and the electric carmaker Tesla. They parked
themselves in the “war room,” on the second floor of a building attached
to Twitter’s headquarters. The area, which Twitter used to fete
big-spending advertisers and dignitaries, was stocked with company
memorabilia.
The
advisers included the venture capitalists David Sacks, Jason Calacanis
and Sriram Krishnan; Mr. Musk’s personal lawyer Alex Spiro; his
financial manager Jared Birchall; and Antonio Gracias, a former Tesla
director. Joining in were engineers and others from Tesla; from Mr.
Musk’s brain interface start-up, Neuralink; and from his tunneling
company, the Boring Company.
At times, Mr. Musk was spotted with his 2-year-old son, X Æ A-12, at Twitter’s office as he greeted employees.
In
meetings with Twitter executives, Mr. Musk was direct. At the Oct. 28
meeting with human-resource executives, he said he wanted to reduce the
work force immediately, before a Nov. 1 date when employees would
receive regularly scheduled retention bonuses in the form of vested
stock. Tech companies often compensate employees with regular share
grants, earned over time the longer they stay at the firm.
One
Twitter team began creating a financial model to show the cost of the
layoffs. Another built a model to demonstrate how much more Mr. Musk
might pay in legal fees and fines if he proceeded with the rapid cuts,
three people said.
On Oct. 30, Mr.
Musk received word that the rapid approach could cost millions of
dollars more than laying people off with their scheduled bonuses. He
agreed to delay, four people said.
But
he had a condition. Before paying the bonuses, Mr. Musk insisted on a
payroll audit to confirm that Twitter’s employees were “real humans.” He
voiced concerns that “ghost employees” who should not receive the money
lingered in Twitter’s systems.
Mr.
Musk tapped Robert Kaiden, Twitter’s chief accounting officer, to
conduct the audit. Mr. Kaiden asked managers to verify that they knew
certain employees and could confirm that they were human, according to
three people and an internal document seen by The Times.
The
Nov. 1 bonus date came and went with no mass layoffs. Mr. Kaiden was
fired the next day and marched out of the building, five people with
knowledge of the situation said.
A trip to New York
As
Twitter managers compiled lists for layoffs, Mr. Musk flew to New York
to meet with advertisers, who provide the bulk of Twitter’s revenue.
In
some advertiser meetings, Mr. Musk proposed a system for Twitter users
to choose the kind of content that the service exposed them to — akin to
G to NC-17 movie ratings — implying that brands could then target their
advertising on the platform better. He also committed to product
improvements and more personalization for users and ads, two people with
knowledge of the discussions said.
But
his outreach was undercut by the departures of two New York-based
Twitter executives — Ms. Berland and JP Maheu, a vice president in
charge of advertising. They were well known in the advertising
community.
Those Twitter executives
“had great relationships with the senior-most people at the Fortune 500 —
they were incredibly transparent and inclusive,” said Lou Paskalis, a
longtime advertising executive. “Those things engender tremendous trust,
and those things are now in question.”
Brands including Volkswagen Group, General Motors and United Airlines have said they will pause advertising on Twitter as they evaluate Mr. Musk’s ownership of the platform.
Mr.
Musk elevated some managers at Twitter. He tapped Esther Crawford, a
product manager, to revamp a subscription service called Twitter Blue.
Mr. Musk wanted a new version of the service, which would cost $8 a
month and include premium features and the verification check mark that
was previously assigned for free to the accounts of celebrities,
journalists and politicians to convey their authenticity.
He laid down a deadline: The team must finish Twitter Blue’s changes by Nov. 7 or its members would be fired.
Last week, Ms. Crawford shared a photo of herself sleeping at Twitter’s San Francisco offices in a sleeping bag and an eye mask, with the hashtag #SleepWhereYouWork.
Her
message rubbed some colleagues the wrong way. They wondered in private
chats why they should commit long working hours to a man who could fire
them, according to five people and messages seen by The Times. On
Twitter, Ms. Crawford responded
to what she called “hecklers” by saying she had received supportive
messages from other entrepreneurs and “builders of all types.”
The ax falls
The
scope of layoffs was a moving target. Twitter managers were initially
told to cut 25 percent of the work force, three people said. But Tesla
engineers who reviewed Twitter’s code proposed deeper cuts to the
engineering teams. Executives overseeing other parts of Twitter were
told to expand their layoff lists.
Twitter
executives also suggested assessing the lists for diversity and
inclusion issues so the cuts would not hit people of color
disproportionately and to avoid legal trouble. Mr. Musk’s team brushed
aside the suggestion, two people said.
On
Nov. 2, employees stumbled upon an open channel in the internal Slack
messaging system where human resources and legal teams were discussing
the layoffs. In a message seen by The Times, one employee said 3,738
workers could be laid off, or about half the work force. The message was
widely shared internally.
That
evening, Mr. Musk met with some advisers to settle on the reduction,
according to a calendar invitation seen by The Times. They were joined
by employees from Twitter’s human resources and staff from his other
companies.
Anticipating the cuts,
employees began bidding farewell to their colleagues, trading phone
numbers and connecting on LinkedIn. They also pulled together documents
and internal resources to help workers who survived the layoffs.
One
engineering manager was approached by Mr. Musk’s advisers — or “goons,”
as Twitter employees called them — with a list of hundreds of people he
had to let go. He vomited into a trash can near his feet.
Late on Nov. 3, an email landed
in employees’ inboxes. “In an effort to place Twitter on a healthy
path, we will go through the difficult process of reducing our global
work force,” the email, signed “Twitter,” said.
Pandemonium
followed. While the note said employees would receive a follow-up email
the next morning about whether they still had jobs, many found
themselves locked out of email or Slack that night, an indication they
had been laid off. Those who remained in Slack posted saluting emojis en
masse as a send-off for co-workers.
The
cuts were enormous. In Redbird, Twitter’s platform and infrastructure
organization, Mr. Musk shed numerous managers. The unit also lost about
80 percent of its engineering staff, raising internal concerns about the
company’s ability to keep its site up and running.
In
Bluebird, Twitter’s consumer division, dozens of product managers were
laid off, leaving just over a dozen of them. The new ratio of engineers
to managers was 70 to 1, according to one estimate.
The aftermath
As layoffs unfolded, tech recruiters sensed opportunity. Top managers at rival companies such as Meta and Google sent messages to some of the employees being let go from Twitter, said two people who received the notes.
Most
of Mr. Musk’s subordinates remained quiet throughout the process. But
Mr. Calacanis, the venture capitalist, had been active on Twitter
responding to product suggestions and concerns.
Last
week, Mr. Musk dispatched a lieutenant to the “war room” to ask Mr.
Calacanis, who was there, to cool it on Twitter and stop acting as if he
were leading product development or policy, people familiar with the
exchange said.
“To be clear, Elon is the product manager and CEO,” Mr. Calacanis later tweeted. “As a power user (and that’s all I am!) I’m really excited.”
By
last Saturday, Mr. Musk’s advisers realized that the cuts may have been
too deep, four people said. Some asked laid-off engineers, designers
and product managers to return to their old jobs, three people familiar
with the conversations said. The tech newsletter Platformer earlier reported the outreach.
At
Goldbird, Twitter’s revenue division, the company had to bring back
those who ran key money-generating products that “no one else knows how
to operate,” people with knowledge of the business said. One manager
agreed to try rehiring some laid-off workers, but expressed concerns
that they were “weak, lazy, unmotivated and they may even be against an
Elon Twitter,” two people familiar with the matter said.
On
Monday, some Twitter employees arrived at work to find that certain
systems they had relied on no longer worked. In San Francisco, an
engineer discovered that some contracts with vendors that provide
software for managing user data had been put on hold or had expired, and
that the managers and executives who could fix the problem had been
laid off or resigned.
On Wednesday,
workers in Twitter’s New York office were unable to use the Wi-Fi after a
server room overheated and knocked it offline, two people said.
Mr. Musk plans to begin making employees pay for lunch — which had been free — at the company cafeteria, two people said.
An internal clash
Inside Twitter, some employees have clashed with Mr. Musk’s advisers.
This
week, security executives disagreed with Mr. Musk’s team over how
Twitter should meet its obligations to the Federal Trade Commission.
Twitter had agreed to a settlement with the F.T.C.
in 2011 over privacy violations, which requires the company to submit
regular reports about its privacy practices and open its doors to
audits.
On Wednesday, a day before a
deadline for Twitter to submit a report to the F.T.C., Twitter’s chief
information security officer, Lea Kissner; chief privacy officer, Damien
Kieran; and chief compliance officer, Marianne Fogarty, resigned.
In
internal messages later that day, an employee wrote about the
resignations and suggested that internal privacy reviews of Twitter’s
products were not proceeding as they should under the F.T.C. settlement.
Some
engineers could be required to “self-certify” that their projects
complied with the settlement, rather than relying on reviews from
lawyers and executives, a shift that could lead to “major incidents,”
the employee wrote.
“Elon has shown
that his only priority with Twitter users is how to monetize them,” the
person wrote in the message, which was viewed by The Times.
The
employee added that Mr. Spiro, Mr. Musk’s lawyer, had said the
billionaire was willing to take risks. Mr. Spiro, the employee said,
told workers that “Elon puts rockets into space — he’s not afraid of the
F.T.C.”
The F.T.C. said that it was
tracking the developments at Twitter with “deep concern” and that “no
C.E.O. or company is above the law.” Mr. Musk later sent employees an
email saying Twitter will adhere to the F.T.C. settlement.
On
Thursday, more Twitter executives resigned, including Kathleen Pacini, a
human-resource leader, and Yoel Roth, the head of trust and safety.
At the meeting with employees that day, Mr. Musk tried to sound a note of optimism about Twitter’s future.
“Twitter
can form an incredibly valuable service to the world and be the public
town square,” he said, noting it should be a “battleground of ideas”
where debate could “take the place of violence in a lot of cases.”
Reporting was contributed by Kevin Roose, Lauren Hirsch, Kitty Bennett and David McCabe.
NEW YORK TIMES
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