Musk Brings in New Investors to Contribute $7 Billion to Twitter Deal
The projected numbers included Twitter’s annual revenue exceeding $13 billion and its earnings before interest, taxes, depreciation and amortization — a measure of profitability — potentially hitting $6 billion by 2025, two people who viewed the numbers said.
Investors were given a few days to make a decision. Some balked at the speed and lack of detail on governance issues, including voting rights, information rights and the makeup of Twitter’s board of directors under Mr. Musk’s stewardship, one person said. The $44 billion that Mr. Musk is paying for Twitter was also a sticking point, given the company’s inconsistent profits, the person said.
Morgan Stanley declined to comment.
Some investors didn’t wait for Mr. Musk to reach out to them. Binance contacted him directly, a person familiar with the situation said, and is investing $500 million. The cryptocurrency exchange saw an opportunity to use the blockchain, a database for digital information, to help tackle bots, which are automated accounts that spam people, the person said.
“A small contribution to the cause,” Changpeng Zhao, Binance’s founder, said on Twitter about the investment. (The company also recently invested in Forbes, aiming to integrate cryptocurrency with a traditional media company.)
Sequoia Capital, a Silicon Valley venture firm, invested $800 million and said it had “had a front-row seat to Elon’s business and technical prowess” for two decades.
“We see, as he does, the opportunity to drive meaningful product innovation that will help unlock Twitter’s full potential as a global platform that connects the world,” a spokeswoman for Sequoia said.
Brookfield, a real estate management firm, invested $250 million through its technology growth investing arm. The firm has used Tesla technology to add solar panels to some of its properties and recently invested in SpaceX. Brookfield declined to comment.