Over the past 12 months, billionaire innovator Elon Musk has sparked one high-profile controversy after another across his business empire – especially since his chaotic takeover of social media platform Twitter.
Here we take a data-driven look at the 5 biggest Elon Musk controversies from 2022-2023 – analyzing what happened, why they matter, their measurable impacts, and what lessons Musk and business leaders may take away from this turbulent period.
The controversies we‘ll cover:
- Musk‘s erratic $44B Twitter acquisition saga
- Losing over $200 billion in personal wealth
- Revisiting court over 2018 Tesla "funding secured" tweets
- Removing verification checkmarks on Twitter
- Publicly mocking a disabled former Twitter employee
Musk By the Numbers: Key Stats and Figures
Before diving into the controversies, let‘s ground this analysis with some key metrics tracking Musk‘s exceptional personal wealth and influence up until the recent turmoil.
Wealth and Net Worth Over Time
| Date | Est. Net Worth (USD) | World‘s Richest Person? |
|---|---|---|
| January 2021 | $185 billion | Yes |
| November 2021 | $320 billion | Yes (peak) |
| January 2023 | $137 billion | No (#2) |
- Musk began 2022 worth over $300 billion as the world‘s richest individual by far. He finishes it having lost over $200 billion – the biggest one-year decline ever.
Number of Followers on Twitter
| 2014 | 2 million |
|---|---|
| 2016 | 7 million |
| 2022 pre-acquisition | 93 million |
| 2023 present | 129 million |
- Musk has leveraged Twitter to build the largest personal mass media platform ever – now owning the network and its hundreds of millions of users.
Key Tesla Stock Figures
| Metric | 2021 Year-End | 2022 Year-End | % Change |
|---|---|---|---|
| Share Price | $1,056 | $123 | -88% drop |
| Market Cap | $1.1 trillion | $386 billion | -65% drop |
| Deliveries | 936,000+ vehicles | 1.3 million vehicles | +39% growth |
- Despite Tesla setting delivery records in 2022, stock performance cratered partially due to investor concerns over Musk‘s Twitter distraction.
1. Chaotic $44 Billion Twitter Takeover Saga
Elon Musk’s on-again, off-again $44 billion takeover of social media platform Twitter was among the most dramatic and impactful business stories of 2022. Let‘s break down key events in this tumultuous saga:
April 4 – Musk discloses purchase of 73 million Twitter shares (~9% ownership stake)
April 14 – Offers $54.20 per share to buy remaining Twitter stock and take the company private. Cites goals of promoting free speech and eliminating spam accounts.
April 25 – Twitter accepts Musk‘s $44 billion offer after initial resistance. Deal appears done.
May-July – Musk begins threatening to walk away unless Twitter can prove bots make up <5% of monetizable users. Twitter rebukes his claims.
July 8 – Musk terminates the deal. Twitter sues to force acquisition. Stock craters as legal battle looms.
October 4 – Suddenly revives offer to close deal right before Delaware trial to force sale.
October 28 – Takeover closes. Musk fires executives, declares himself “Chief Twit.”
November – Lays off ~50% of Twitter workforce. Engineers resign over demanding ultimatums. Advertiser pullback intensifies.
The Aftermath at Twitter
| Metric | Pre-Acquisition | Post-Acquisition | Change |
|---|---|---|---|
| Workforce | ~7,500 full-time | 2,000-3,000 remaining | -60% to -75% |
| Daily Users | 237 million (June 2022) | 246 million (Feb 2023) | +4% |
| Ad Revenue | $5.18B (2021) | $1.47B (est. 2023) | -72% plunge |
Twitter is struggling to operate amid Musk-led attrition and executive defections. But its online influence reach has if anything grown (at least temporarily).
Impacts on Musk‘s Reputation and Finances
Musk attained his desired conquest of Twitter, but at immense cost to his image, focus, and wealth:
- Musk‘s net worth dropped over $100 billion since the initial buyout offer, partially fueled by Tesla stock declines attributed to investor concern over Twitter being a distraction.
- He‘s brought intensified political scrutiny upon himself across global media.
- His leadership style and accountability face growing doubts.
- Musk admitted Tesla suffered due to reduced attention last year.
Rather than cementing Musk as a conquering visionary, the Twitter takeover has been a self-inflicted blackhole of controversy – with lasting ramifications still unfolding.
2. $200+ Billion Wealth Drop Sets Unwanted Record
While Tesla CEO Elon Musk is still extraordinarily wealthy, his personal fortune cratered over $200 billion since late 2021 – setting the record for the largest loss of net worth in history.
Musk‘s net worth (primarily Tesla shares) topped $340 billion in Nov 2021. But it tumbled steadily over 2022 as economic instability and distractions like Twitter hammered Tesla’s once unstoppable stock price.
By December 2022, Musk‘s net worth had collapsed to around $137 billion – still the world #2, but forcing him to sell billions in Tesla stock to finance obligations like taxes and the Twitter purchase.
Acceleration of Wealth Loss in 2022
| Date | Approx. Net Worth | Recent Loss |
|---|---|---|
| April 2022 | $274B | — |
| July 2022 | $212B | $62B in 3 months |
| October 2022 | $174B | $38B in 3 months |
| December 2022 | $137B | $37B in 2 months |
The rate of wealth loss accelerated later in 2022 as economic red flags compounded – culminating in a disastrous year for Musk’s finances.
Tesla Share Performance Driving Loss
Almost all of Musk‘s fortune stems from his Tesla stake, valued at over $300B in 2021. Tesla comprising 80%+ of his net worth makes its stock performance inseparable from his wealth.
| Date | TSLA Share Price | Market Cap |
|---|---|---|
| Sept 2021 | $774 | $786B |
| Dec 2022 | $123 | $382B |
This corresponds almost directly with Musk‘s paper fortune shrinking by over $200B. Tesla shed 65% of its market cap based on growth concerns and Musk‘s Twitter distraction.
Losing over $200 billion in net worth in less than two years represents a shocking wealth reversal almost unmatched in history. Rather than indefinite stratospheric gains, Musk has proven vulnerable to market whims and his own split attention – despite Tesla‘s operational progress.
3. Renewed Court Scrutiny Over 2018 Tesla Tweets
One major Elon Musk controversy originating in 2018 returned to public spotlight in early 2023: lawsuits over his notorious “funding secured” tweet claiming investor support to take Tesla private.
On August 7, 2018, Musk tweeted that he had “funding secured” to buy out Tesla shareholders at $420 per share. Tesla‘s stock soared temporarily before it became clear the buyout was not indeed certain.
The SEC sued Musk for false claims and market manipulation. They settled in 2018, fining Musk $40M and forcing his resignation as Tesla chairman.
But Tesla investors also sued Musk and the company directors for billions in losses from the tweet and its aftermath. The case finally went to trial in January 2023 in San Francisco.
Key Testimony
- Musk testified the Saudi sovereign wealth fund had verbally committed to backing a Tesla go-private deal, but final paperwork and sell-off logistics remained incomplete – contradicting his “secured” phrasing.
- Investor attorney Nicholas Porritt argued Musk’s “false tweets” caused “regular people like firefighters, pensioners…to lose millions and millions of dollars.” He claims over $14 billion in total shareholder losses flowed from the Aug 2018 tweet storm.
- On cross-examination, Musk said, “Just because I tweet something does not mean people believe it or will act accordingly.” He also admitted tweets move markets based on people assuming he has special insights into Tesla.
The Verdict‘s Impacts
Ultimately in late February, the jury found Musk and Tesla‘s directors not liable for investor losses. Key impacts:
- Affirms limited accountability for Musk’s market-moving social media communications regarding Tesla. Sets precedent for future erratic statements.
- However, reminds public of the turmoil Musk triggers through impulsive tweets with opaque meaning or validation. Conflicts with responsible public leadership.
- The lawsuit still represents a distraction and reputational blow for Musk after avoiding severe financial penalties. Adds another layer of controversy on top of the messy Twitter acquisition process overlapping through 2022.
4. Removal of Twitter‘s Identity Verification System
Within days of finalizing his Twitter purchase in late October 2022, Elon Musk upended the platform‘s longstanding identity verification system – creating chaos and uncertainty across the influential network.
For over a decade, Twitter‘s iconic blue "Verified" checkmark denoted an account‘s authenticity – distinguishing public figures, brands, and journalists from impersonators. Obtaining verification required submitting personal IDs and meeting Twitter‘s notability criteria.
However, Musk moved swiftly to tie verification to a new $8 per month Twitter Blue subscription requiring just a credit card and no vetting. His goal was boosting subscription revenue to stabilize Twitter‘s finances.
This overnight overhaul aimed at monetization had severe consequences:
Spike in Impersonations
Without meaningful verification controls, imitators could appear legitimate by simply purchasing the new blue checkmark.
- Numerous brands like Eli Lilly, Nintendo, and Lockheed Martin had impersonators spew inflammatory or false tweets that tanked stock prices and required public statements to refute.
- Individuals also faced harassment from high-visibility parody accounts.
Loss of Accountability and Transparency
Public figures and media outlets long relied on verification to clearly distinguish official presences on Twitter from fan or satire accounts. Removing this layer of authoritative validation allowed misinformation to flourish.
Credibility Crisis with Advertisers
Twitter derives over 90% of its revenue from advertising. But the verification debacle made brands reluctant to risk other PR crises. Many announced advertising pauses or budget reductions, compounding Twitter‘s financial woes.
While still private as CEO, Musk responded flippantly – tweeting that advertisers know where their customers are and will ultimately return. However, eroding trust and introducing volatility poses an existential threat to Twitter.
After the initial verification overhaul ignited platform-wide disinformation and parody crises, Twitter eventually added a secondary “Official” label for government and commercial entities. But for Musk, the damaged was already done from destabilizing Twitter’s longstanding and reliable identity infrastructure virtually overnight.
5. Publicly Mocking a Physically Disabled Ex-Employee
In one of his most stunning displays of callousness, Musk publicly degraded and mocked a physically disabled former Twitter employee in December 2022 without justification.
Software engineer Haraldur Thorleifsson helped pioneer video infrastructure at Twitter‘s early predecessor Vine. He has a hereditary neuromuscular disability limiting his typing capacity. When Musk arbitrarily locked him out of Twitter systems after taking over, Thorleifsson tweeted asking if he had been let go.
Rather than respond professionally about his status, Musk laughed off Thorleifsson‘s disability as an “excuse” and suggested he didn‘t contribute real work despite not knowing his role. Faced with outrage over these demeaning lies, Musk ultimately admitted he "was told false things" about the employee and backtracked.
But immense damage from publicly humiliating a visibly disabled veteran employee was already done.
Here‘s what fellow tech workers and experts highlight about the Thorleifsson incident:
- Engineer friend Max Scoville tweeted that despite limited mobility, Thorleifsson is "one of the most creative, generous & resilient people I‘ve ever met…he revolutionized online video.”
- Industry analyst Benedict Evans argued Musk‘s attack represented the billionaire “punching down" on an employee vulnerable for their health and livelihood compared to Musk‘s immense power
- Physician Eugene Gu called Musk’s comments “unconscionable” for mocking disabilities. He contrasted Thorleifsson overcoming physical limitations with Musk downplaying how his privileged upbringing powered success.
- Others questioned Musk‘s honesty and willingness to smear workers without understanding an employee‘s true value
This ugly episode left observers appalled at Musk‘s lack of empathy for the disabled and instincts to publicly denigrate a committed employee facing vulnerability. It serves as a case study in callous leadership.
Key Takeaways: Musk Must Adapt His Leadership Style
Reviewing Elon Musk‘s 5 most severe controversies over the past year offers several cautionary lessons if his ambitions hope to recover:
Musk‘s strengths can swiftly turn to weaknesses – His unconventional, technology-first approach can yield innovations. But the same disruptive thinking fuels self-defeating volatility in management and communications lacking nuance.
With great power comes great accountability – Musk has yet to demonstrate consistent ability to take responsibility for harms from his speeches and actions – an unsustainable trait as his platforms grow more influential.
Vision requires collaboration – Alienating workforces, shareholders, users, and partners through unchecked ego risks imploding Musk‘s visions from the inside. Even genius needs cooperation.
Rather than a year of unalloyed victories, 2022 marked the emergence of saboteur risks within Elon Musk’s persona and leadership style. Reckoning with these failings presents his next great challenge – one technological ingenuity alone cannot overcome. The world will watch if epic ambition outweighs flawed character.
