Elon Musk

If he's still actually working there (?) then I guess he's getting his monthly cash salary (although if he had to ask if he was still working there then maybe he's not even getting that).

But salaries are mostly irrelevant for senior leadership. They're <10% of their compensation. He's not getting any of the millions of dollars of accelerated vest stock he's entitled to if/when he gets fired "for cause" (ha) or leaves voluntarily.

We know this because neither has any VP+ or acquisition exec. I guess some of them might eventually. Seems unlikely. But the "uh oh elon really screwed up firing this person" stories that have come with every wave of layoffs have big "i'd like to see him wriggle his way out of this jam" energy.

my assumption was that the novel "pay me for my company as salary" would mean he'd have an abnormally large salary unless he spread it out over a very long term, which seems goofy because it'd be odd to assume any social media company's going to exist for twenty years

so as a line item Elon would probably see he had the top salary and be like "fire this guy he costs way too much" without bothering to find out why

SOP is that he (and esther crawford) would have had pro forma cash salaries similar to SWEs, i.e. maybe $200k in the US, presumably much less in iceland. the real ~$Xm acquisition money would have vested as stock (or now cash at $54.20) quarterly over four years, with a rider saying "you get all of it immediately if we fire you without cause" (which is not being honored).

i don't get the impression he made much of an effort to fire people with high total comp *in particular*. these people would have gone in the first wave otherwise. they probably earn 10x what everyone else at their level earns.

I haven’t been following the Tesla stock price since it mysteriously rallied but I see it’s now dropped from around $200 to $184 in two days? Keep it going king

fwiw I'm going off this source: https://www.icelandreview.com/news/haraldur-thorleifsson-sweeps-person-of-the-year-awards/

it might have been a one-time payout as wages, not clear

tbf, i don't know if his contract would have had a 'for cause' out. if he was the owner of the company he sold and actively chose to take his payment as salary instead of as a payment (whether in stock or cash) I doubt they would have included a for cause out. that would not be equivalent to taking his consideration as a one-time payout with no strings attached.

where musk could have stonewalled him I think is just dragging out the process by which he sues and tries to get the money he's owed under the contract. like, if he sues in iceland and wins a judgment, musk could simply choose to not pay. i doubt twitter actually sends any money through iceland as part of normal operations, so it'd be hard to enforce in iceland. which means he'd probably have to go to the US and get a US court to recognize the judgment and then to garnish revenue from twitter's bank accounts or something. but imagine the headlines - musk is making the guy with muscular atrophy who can't go to the bathroom without assistance actually get on a plane and fly all the way to the US to appear in a courthouse to get the money he was owed under the contract. that would not be a great headline for someone who is trying to convince advertisers that twitter is not a lightning rod of controversy and is safe to advertise on!

i would guess the vesting schedule was the normal one, even if he took it in cash rather than stock.

Normally in such large sales, the payment comes in the form of stock or other financial instruments, which categorize the sale as capital gains

this is not true in the US and UK and it would surprise my if it were true in iceland. stock compensation is taxed as ordinary income. if it wasn't then companies could save money by paying their employees in 100% stock.

anyway, musk could have picked a less sympathetic guy to get into a fight with. twitter is full of them.

is calacanis still there?

that appears to be the m.o. here, just fire everyone and not pay for anything and then drag things out in court to the point where the different parties will take a much smaller settlement

not sure how that applies to the rent situation where they could just get evicted, though

yet another trump parallel

xp it was an acquihire? i assume they paid ~$0 for the company, and the value was in tying up good people with golden handcuffs. and surely an exec wouldn't accept golden handcuffs without an accelerated vesting clause? that seems nuts.

that xp is to 龜 sorry

https://techcrunch.com/2021/01/06/twitter-acquihires-creative-agency-ueno-to-help-design-new-products/

I think a lot of suppositions and conjectures are being made (the $100M figure keeps getting thrown around) but here's what was reported at the time

$100M seems in the ballpark if that covers a nominal acquisition price (reading between the lines in haraldur's murder thread, it doesn't seem to have been worth a lot as a business per se by this time) and the comp for 50 acquihires for 4 years.

idk if you ask me $100M is a business that is worth a fair bit

in an acquihire that $100M is almost all going to people who don't own the business (i.e. its employees), and only if they stay for four years. the owner of the business gets relatively little cash for the business itself on closing (which is not to say this guy is not a mensch for voluntarily maximizing his tax liability).

the thing is agencies are by their nature worth basically 0

yup.

xp it was an acquihire? i assume they paid ~$0 for the company, and the value was in tying up good people with golden handcuffs. and surely an exec wouldn't accept golden handcuffs without an accelerated vesting clause? that seems nuts.

― 𝔠𝔞𝔢𝔨 (caek), Wednesday, March 8, 2023 12:33 PM (nineteen minutes ago)

i think there'd be at least some payment for the equity of the company, might not be the full $100MM deal price. i've never worked on one but this seems like a good summary https://www.cooleygo.com/acqui-hire-basics/

i'm speculating that halli would have received cash in exchange for ueno's equity because of this whole thing in the news about him taking a salary and paying taxes on it as ordinary income, contributing to iceland's social safety net etc. vs. a one-time cash payment for his ueno shares on which he would only pay capital gains tax. the previous sentence makes sense only if one of the options he was choosing between was selling his shares in ueno for cash + assuming iceland taxes long-term capital gains at a lower rate than ordinary income (which would make sense insofar as it mirrors the us regime).

the other option seems to be this structure that they ended up with though that does sound bizarre - that he gave up his equity for $0 in return for a guaranteed salary for life. maybe what was meant was that the consideration for halli came in two parts, cash for his shares + guaranteed salary, and he weighted it much more towards his salary? personally, i would have taken the lump sum and invested it in treasuries or something, which is the advice they give to all lotto winners.

side note, acquihires seem weird to me - employment is generally at-will (i.e. either side can fire/quit at will) and i think it'd be hard to force someone to basically work for a company without letting them quit. seems courts would not like that. so seems like you make them work by offering above market comp to the employees for a number of years. which i think is what the cooleygo article gets at and what you referred to as golden handcuffs. as elon would say, interesting!

the cooley article says $2M per head is at the high end of the range for an acquihire - that seems excessive for a bunch of graphic designers, no? (apologies to all the graphic designers who read ilx).

makes sense to me that halli as owner of ueno would get paid a little more, say $10-20 million, as the gatekeeper, and the rest of the $100MM was split among the 49 other employees, that brings the actual cost per head down. and makes sense as to why halli gets put on the DO NOT FIRE list, you don't want $20MM of cash (or RSUs) going out the door in one day.

fwiw, i have been on the receiving end of an acquihire.

every share holder (which happened to include employees) got a lump sum share of the total acquisition price of $Xm in cash. (i got 1% of that $Xm in cash and paid off my credit cards on airport wifi the morning the deal closed.)

every employee who chose to stay got around double their market rate in comp over the following four years. the projected total for that was about $3Xm in our case. you're still at will. there were 7 of us. only 2 of us stayed for 4 years, even though we were paid much more than market rate.

i guess the point is that the acquistion cash to owners is not $0, and that's presumably the capital gain he elected to take as income, which makes that article make sense. but normally the ongoing comp an essential acquihire employee receives is larger than the cash they get as a shareholder/owner (that's what makes it an acquihire). the ongoing comp is what's normally subject to accelerated vesting, and what i'm assuming musk is not going to pay.

$2M/head as comp over four years is about right. it's a little high for non-eng, but it's not crazy.

halli will have been on single figures million a year, with accelerated vest.

that makes a lot of sense, you're just bulk-hiring known talent and expertise

good posts

interesting post on this https://lethain.com/digg-acquihire/

that he gave up his equity for $0 in return for a guaranteed salary for life.

this would rule

that's really interesting caek!

i do wonder if any of the other employees at ueno actually had equity, or maybe twitter just sort of agreed to buy everybody's shares at different prices. i'm assuming they would not have given essential employees who owned equity the option to weight their equity more heavily than the salary potion of the comp. i'm assuming for essential employees you want their to be some sort of balloon payment at the end, to incentivize people to stay. if they gave halli the option to weight his comp toward a lump sum for his equity, maybe they didn't view him as essential.

i do recognize this convo is going off the rails. to bring it back, i appreciated the sick burn halli had on elon having twitter shitter bodyguards.

i do wonder if any of the other employees at ueno actually had equity, or maybe twitter just sort of agreed to buy everybody's shares at different prices.

startup employee equity is so chaotic that i think anything goes, and the CEO/founder has a ton of influence on what happens. basically they have a big dial called "give myself less money or screw over employee-shareholders" that they are free to adjust based on their particular needs.

xp yeah, he restrained himself but there were some nice mild insults in that thread

are people from iceland known to be really rude though? that might have been brutal

this whole thing has been an absolute PR disaster for Musk specifically, and more broadly the wreckage of what was once Twitter

it's the worst thing he's done this week for sure

just this from BBC:

Photographer Daniel Houghton tweeted "As someone who has worked directly with Halli Thorleifsson during a turnaround, this is super disappointing to see. Not only is his work ethic next level, his talent and humility are world class."

Mr Musk replied: "Based on your comment, I just did a video call with Halli to figure out what's real vs what I was told. It's a long story. Better to talk to people than communicate via tweet."

Dude 'communicate via tweet' is literally all you do all day long

yet I read both of those things as tweets and not as a BBC article

as the proud still-new owner of twitter i say: better not to communicate by it!

other uses are ok tho (muting people)

this conversation is making me realize once again that i should ask all of you tech types for money. gimme!

How much you want

I would like four thousand dollars

thats super cheap. i want 40 million.

us techies don't have any money, we have stock options and man buns

elon has money because he makes space rockets and automobiles

And never pays anyone

every day this shitwad finds a new way to fail beyond anyone who didn't grow up living off the proceeds of blood diamonds, it's almost impressive really. and still he continues onwards/downwards. is there no bottom? there is no bottom.

The bottom is suicide or life in prison. He'll likely fail into a pillow full of money instead.

assassinated on his own toilet by his own bodyguards, tywin-lannister-style

oh my god

Elon Musk asked managers at Twitter to nominate their best employees for promotion, then fired the managers and replaced them with their lower paid nominees https://t.co/ngOh68eEZ5

— Luke Bailey (@imbadatlife) March 9, 2023

is this how he ran tesla? it seems like he is actively trying to destroy morale.

does he have this kind of control there? i'd image anyone else who is in a position of power at his other ventures, if they have an ounce of sense, has got to be drawing up plans to get him away from any decision making powers

Tesla’s board is very deferential to Musk but they could change their minds

Musk being ousted would be hilarious, people would create videos of themselves burning their Teslas

perhaps he has become more reckless over time.