Elon Musk gets $7 billion in financing from 19 investors for Twitter deal, Meta freezes hiring

Yahoo Finance's Dan Howley details Elon Musk's financial backing for his Twitter acquisition, including Larry Ellison, the Tesla CEO's plan to fill in as temporary CEO of Twitter, and Meta's announcing a hiring freeze amid slowing growth.

Video Transcript

- We know that Elon Musk revealed the names of his co-investors who helped him raise that $7 billion in funding for his Twitter buyout, as well as announcing the name of their CEO. For more on this move, let's bring in Yahoo Finance's Dan Howley. So starting with these investors, who's on that list?

DAN HOWLEY: Yeah. We have Larry Ellison, probably one of the biggest names on this list. We also have a Saudi investment. And then Binance actually is jumping in there. And basically what this means is that Elon Musk has essentially cut down the amount of money that he needs on his margin loan from $12.5 billion to $6.25 billion. And that's huge for him, obviously. Though, it's still going to be a bear for Tesla shareholders. They're going to look at that and say, maybe don't, Elon.

But I think the bigger thing here is that news that he's going to reportedly be the interim CEO when he takes over if he takes over. This isn't a done deal by any stretch of the imagination yet. But that would lead me to believe that he would be perhaps holding that position for potentially some time because he wants to make significant changes to the social network that you haven't seen from it in quite a while. He's talking about opening up speech. He's talking about at some point going away from advertising.

He seems to just be spitballing with what he wants to do here, though. The big thing is the Edit button, which Twitter is already doing, and then that free speech aspect. But he's also talked about things as far as not leaning on advertising as much, not even caring about how much revenue it brings in. And then now we see the reports, obviously, of the company going public again afterwards, or after they go private.

So there really isn't a clear idea as to what he wants to do. And so if he's the interim CEO there, maybe he can give a better look. But if you're a Tesla shareholder, you've got to be kind of biting your fingernails at this point, thinking, you know, when is he going to get back to Tesla, or how much attention is he still going to be able to pay to Tesla, as we're waiting for a few vehicles to come out.

- Well, Dan, how do you think that's going to be received? You were laying out some of the changes that Elon Musk wants to make to Twitter. Obviously, if he takes it private he's not as worried about-- or isn't worried about shareholders. But in the tech world, are they excited about this? Do they think he is possibly the right person for this job?

DAN HOWLEY: I mean, look, I think it's a mixture. It's some people do love Elon Musk. I think when it comes to Jack Dorsey, huge fan. They're basically just they're bros. They're like that, right. But I think when it comes to other social networks, Facebook-- I'm sure Mark Zuckerberg isn't excited about that. Snap, I'm sure people over there aren't happy.

I think basically what it comes down to is there are people in Silicon Valley who are very much of the same mindset as Elon Musk. And there are others who are not. The main through line between Tesla-- sorry, Twitter and Facebook really is Peter Thiel. He apparently was one of the forces behind Elon Musk looking for this takeover. He was also, obviously, a board member for Facebook. So you've got to imagine that he's playing both sides of the fence here now.

- Well, speaking of Facebook and since you brought it up, I want to bring up a headline that caught our attention this morning. And that's Meta. So plans I guess-- there's a leaked memo. Meta might be pulling back on its hiring. Any idea-- obviously, the company has been struggling pretty significantly since the start of the year. But why do you think now they are deciding to pause hiring?

DAN HOWLEY: Well, look, I think they saw that positive reaction that people had when they announced their earnings recently, saying that they're going to be pulling back on spending. That's just because of how much they're dumping into this metaverse idea and that the idea that the metaverse isn't going to be paying off for some time.

So I think they realized that investors were looking at that and saying, look, we need some kind of reassurance that you're not just betting the house on this idea of this nebulous metaverse. You're going to be doing something a little bit more than just that. I think they realized, OK, we have to pull back that spending. So we're going to stop hiring as much now. But, I mean, the metaverse is still their-- that's the big thing for them next. Do you know anybody that really is excited about a metaverse besides investors? I don't know.

- That's a good point. All right. Dan Howley, thanks so much again.