April 14, 2022
Photo by Suzanne Cordeiro/AFP via Getty Images
Good morning! The metaverse doesn’t yet exist, and we don’t even seem to have a very strong grasp on what it’s going to look like. Nick Statt will tell you all about that in a minute. But first, there's Elon Musk news. I'm Tim Grieve, and this isn't what I was planning to be doing this morning.
When Parag Agrawal tweeted Monday that Elon Musk wouldn’t be joining Twitter’s board after all, he said: “I believe this is for the best.”
If his words sounded like polite spin on an ugly divorce, it turns out they were. What we know now that we didn’t know then: Musk turned down a seat on the Twitter board because he wants to buy the entire company. According to a new SEC filing, Musk has offered to buy all of Twitter for $54.20 per share in cash so that he can take the company private.
The clues were all there. Agrawal’s announcement Monday made it clear that he and the board had wanted to bring Musk inside only because they feared the damage he could do from the outside. As a board member, Agrawal said, Musk would be a “fiduciary of the company, where he, like all members, has to act in the best interest of the company and the shareholders.” That meant abiding by Twitter’s code of conduct and not attempting a whole takeover of the company.
So much for all of that. Here’s Musk’s you-can-keep-the-dog text to Twitter Board Chair Bret Taylor:
As I indicated this weekend, I believe that the company should be private to go through the changes that need to be made.
After the past several days of thinking this over, I have decided I want to acquire the company and take it private.
I am going to send you an offer letter tonight, it will be public in the morning.
Are you available to chat?
1. Best and Final:
a. I am not playing the back-and-forth game.
b. I have moved straight to the end.
c. It's a high price and your shareholders will love it.
d. If the deal doesn't work, given that I don't have confidence in management nor do I believe I can drive the necessary change in the public market, I would need to reconsider my position as a shareholder.
i. This is not a threat, it's simply not a good investment without the changes that need to be made.
ii. And those changes won't happen without taking the company private.
2. My advisors and my team are available after you get the letter to answer any questions.
a. There will be more detail in our public filings. After you receive the letter and review the public filings, your team can call my family office with any questions.
Which is to say, your people can call my people.
In a follow-up letter, Musk told Taylor that this is his “best and final” offer, and if it’s not accepted, he’ll reconsider his role as a shareholder. But if there’s one thing we know about Elon Musk, nothing is ever really “final.” After all, he previously vowed to take Tesla private, then a few weeks later said never mind.
Meta’s vision for the metaverse came into sharper focus this week, and it’s clear now that it’s going to be expensive — both for the company making these new technologies, products and platforms, and for the creators it is hoping to court.
Meta’s commission will be higher than Apple’s. The promise of the metaverse is not only about taking sci-fi concepts and bringing them to life. It’s also about building a better version of the internet we have today, or at least that’s what the Web3 evangelists keep saying. But Meta’s new metaverse take rate, revealed earlier this week as part of a new monetization push, doesn’t sound all that progressive.
The take rate is not all that unusual for gaming. The central issue here, it seems, is that most internet users are trying to apply the framework of other digital marketplaces to what is very much an unprecedented type of platform, with the only real comparison being video games like Minecraft and Roblox that rely on user-generated content.
Does Meta justify the cut? Clearly, some Web3 proponents don’t think so. And by the standards of most other digital marketplaces — including ones Meta has publicly railed against over high fees, like Apple’s — Horizon Worlds comes off as exploitative, which appears to be the exact opposite of the impression the company is trying to make.
Taken together, Meta’s rather costly AR and VR investments and its approach to metaverse monetization give us our clearest indication yet of why Zuckerberg has reoriented his entire company around a nonexistent technology paradigm shift. If Meta owns the headsets and smart glasses, then it owns the platforms and stores. And if it owns the platforms and stores, it gets to set the rates.
If Meta sets up shop on the ground floor of the metaverse, before Apple arrives and before video game companies figure out a way to extricate themselves from their Big Tech landlords, then Meta has a pretty good shot at architecting a way out from under its declining social networking apps. Why then, if you’re a developer interested in AR and VR, would you want to build for Meta? That’s the pitch Zuckerberg and crew are going to have to make now, and it sounds like it’s going to be a tough sell.
The emergence of DeFi is shaking up the way consumers think about how they store value. For reference, Visa saw $2.5 billion of crypto-backed transactions in the first quarter of 2022. We’re seeing consumers really starting to use this in a way that even a year ago was kind of hypothetical.
Brad Smith said companies shouldn’t resist conversations on tech regulation:
Investor Blackwells Capital still wants Peloton to think about a sale:
Deezer is going public via a SPAC, sources told The Wall Street Journal. It’s the French music streaming service’s second go at an IPO, and its valuation is unclear.
IMDb TV is now called Freevee. Amazon’s free streaming service will also launch in Germany later this year.
Lambert Walsh is Amplitude’s first chief customer officer. Walsh most recently led customer success at DocuSign.
L. David Kingsley joined Intercom as its first chief people officer. He last held the same role at Alteryx.
Sequoia's Shailendra Singh left Zilingo’s board. A few others have quit the board as the company investigates its accounting practices.
Tu Nguyen is Sorare’s new CFO. Nguyen last worked in the same role at 1stDibs.Peter Lacovara is Cloud to Street’s new head of Commercial. Lacovara most recently worked on alternative risk transfer at Marsh.
Gavin Newsom interfered with a lawsuit against Activision Blizzard, a state attorney alleged. The lawyer quit as a result.
Amazon is adding another surcharge for third-party sellers. Those who use the company’s fulfillment centers will need to pay another 5% to offset inflation and fuel costs.
Intel’s net zero goal is lacking. The company wants to cut its greenhouse gas emissions to net zero by 2040, but that plan leaves out Scope 3 emissions.
Give this story about Jack Dorsey’s bitcoin obsession a read. Dorsey’s interest in Block isn’t as much about the company as it is about bitcoin, sources told Bloomberg.
Wikipedia editors want the foundation to stop taking crypto, saying bitcoin and ethereum networks use up too much energy. The Wikimedia Foundation hasn’t said if it’ll comply with the request.
Google is dropping billions on offices. It’ll spend $9.5 billion this year on building and improving offices and data centers.TikTok is thinking about a dislike button in the comments. Based on a screenshot of the feature, it looks like a thumbs down will show up next to the heart button.
Companies have some … interesting ideas about how to get workers excited about the office. A marching band welcomed back Google workers; Qualcomm held a happy hour with its CEO; and Microsoft organized a beer and wine tasting. We want to know what would lure you back.
What in-office treats do you expect on your first day back at the office? Are you hoping for a live celebrity performance, or would a comedy show get you pumped? Are a few snacks enough? Respond to this email and let us know, and we’ll round up our favorites in the Sunday edition of Source Code.
Businesses — whether Web2 or Web3-oriented businesses that don’t want to hold crypto but do want to be able to interact with crypto holders — want to be able to offer that as a payment mechanism to their communities. The other is hands-on, where merchants are comfortable accepting crypto.
Thoughts, questions, tips? Send them to email@example.com, or our tips line, firstname.lastname@example.org. Enjoy your day, see you tomorrow.