Tesla CEO Elon Musk testified in a Delaware courtroom that his takeover and reorganization of Twitter is almost complete and that he himself will spend less time at the company by the end of next week and that the transition team he assembled to revamp the company will be phased out.
According to people familiar with the matter, in Elon Musk’s first few weeks as Twitter’s CEO, he invited many close friends to serve as advisers to help transform Twitter, including venture capitalists David Sacks, Jason Calacanis and Sriram Krishnan, among others. In the past few days, the team has looked less active. None of the advisers spoke at a town hall meeting at Twitter’s headquarters in San Francisco last week. After initially using the platform with enthusiasm to cheer the changes Elon Musk has brought, they have also gradually become less vocal.
In the early days of the takeover, Elon Musk’s right-hand man was almost everywhere: Sachs, who worked with Elon Musk at payments company PayPal, worked with the Twitter product team to discuss ideas, while Karakanis, who worked at Sequoia Capital, helped placate advertisers and marketers. Krishnan, who previously worked at Twitter, helped Elon Musk identify leaders for the product and engineering teams, and Behnam Rezaei, who has been in charge of engineering under Elon Musk, worked closely with Krishnan.
All three were present in the Twitter office in the days after Elon Musk’s acquisition deal closed. Initially, they tweeted eagerly about their involvement in Twitter’s makeover, such as Karakanis and Sachs did in a podcast hosted with investors Chamath Palihapitiya and David Friedberg.
Karakanis, Krishnan and Sachs were added to Twitter’s internal Slack account, along with two other, more low-profile venture capitalists, according to a person familiar with the matter. The latter two are Antonio Gracias, a SpaceX board member and founder of Valor Equity Partners, and Sam Teller, a former adviser to Elon Musk and current venture partner at Valor Equity Partners.
In participating in the takeover of Twitter, these individuals went beyond the traditional purview of venture capitalists. Venture capitalists don’t usually play a major role unrelated to their own investments in startups; their expertise lies in helping early-stage, high-growth companies. Twitter was founded 16 years ago and went public in 2013. Now it is once again a private company, thanks to a $44 billion acquisition by Elon Musk. Ayako Yasuda, a finance professor at the University of California, Davis, says it’s “strange” that seasoned venture capitalists would invest their time in such a “long-established” company.
But in the weeks after the deal closed, an already chaotic situation within Twitter became even more confusing, and a new verification tool introduced in early November was quickly shelved after it caused a spike in the number of fake accounts posing as celebrities on the platform. Thousands of employees were fired, but some were wrongfully dismissed and asked to come back days later. Elon Musk did his best to reassure panicked advertisers, even talking about the possibility of bankruptcy.
Through years of socializing and investing in each other, Karakanis, Krishnan, and Sachs eventually won Elon Musk’s trust. Elon Musk helped fund Mahalo, the now-shuttered search engine that Karakanis launched in 2007. Sachs’ venture capital firm, Craft Ventures, invested in several of Elon Musk’s companies, including tunneling startup Boring Co, brain-machine interface company Neuralink and Tesla. Krishnan invested in SpaceX on a personal basis, according to a profile on the professional social networking site LinkedIn, while his employer, Andreessen Horowitz, also provided financing for Musk to help take Twitter private.
These people also have a close relationship with Elon Musk in private. In the past, some Twitter accounts have impersonated Karakanis and Sachs in an attempt to scam for cash and bitcoin. Soon after Krishnan joined Twitter as a product manager in 2017, he received a request for help from Elon Musk, who wanted to stop people from impersonating him on Twitter, according to people familiar with the matter. Elon Musk has said that the bot problem on Twitter was one of the things that prompted him to want to acquire and reform Twitter. Of course, that was also the reason he tried to back out of the deal.
Late last month, Karakanis said on his All-in podcast, “People might immediately say I’ll pay $5 to $10 a month to support the verification feature, but that’s yet to be verified.” The podcast hasn’t discussed the topic since the setback to the launch of Twitter Blue. As of Friday, the $7.99-a-month service was still on hold. With more than 600,000 Twitter followers and 42,000 tweets already, Calacanis is the most frequent user of the platform among the trio.
Calacanis, 51, a former tech journalist who founded the startup gas pedal and investment firm Launch, said he was willing to take the helm of the company after Elon Musk decided to buy Twitter. He sent Elon Musk a message saying, “Make me a game coach! Twitter CEO is my dream job.” On Oct. 31, Calacanis met with Twitter’s advertisers and marketers in New York. That morning, he tweeted, “Let’s get to work!” But it was later reported that Elon Musk had sent someone to ask Karakanis not to tweet so much because he seemed too involved in the product development or policy process. Since then, he has tweeted less and less about Twitter.
Sachs and Elon Musk have known each other the longest. They met at PayPal, the payments company Elon Musk co-founded in 1999 with multiple people and Sachs as chief operating officer. Sachs founded Craft Ventures in 2017, and in addition to Elon Musk’s company, the venture capital firm backs lender Affirm and business analytics firm Addesar. on Nov. 7, he tweeted that he had “no official capacity” at Twitter and was just trying to He tweeted on Nov. 7 that he had “no official capacity” on Twitter and was just trying to “help.
Krishnan, 39, an American immigrant born in Chennai, India, appears to have the most experience directly related to helping others, and his LinkedIn profile shows that Krishnan has worked at Microsoft, Facebook parent company Meta and Snapchat parent company Snap. Former colleagues at Twitter say Krishnan is collegial but slow to make decisions. Krishnan did not return a request for comment.
Krishnan did try to help with the impersonation issue that Elon Musk raised in 2017, according to people familiar with the matter. For a while, things got better, but scammers kept coming up with new ways to defraud.
Krishnan joined Andreessen Horowitz in early 2021 as a general partner, focusing on crypto. He defended the Twitter Blue service on Twitter in the days leading up to its launch. But since then, he has remained silent on the topic. Most recently, he has consistently posted from Chennai, where he and his wife host their live podcast.
Whether Elon Musk will be able to stick to his plan to spend less time on Twitter remains to be seen. He has already announced that he will relaunch the verification feature on Nov. 29 and has told his remaining employees that they need to accept long, intense hours or walk away. For the consultant team, Elon Musk has no such mandate. And he told them they would keep their day jobs. In a Nov. 4 podcast, Sachs said, “Elon Musk is the CEO of Twitter, he’s running the company, he’s the decision-maker, he makes all the decisions. We’re just helping a friend.”