Elon, Sam and Mark: 2022 was the year the billionaires fell through the cracks

Not all billionaires are visionaries. 2022 was the year when successful entrepreneurs got in touch with reality. Elon Musk, Sam Bankman-Fried and Mark Zuckerberg lost their own capital and that of others.

Three dramas in the tech world: fodder for a book, a feature film or an annual review.

1 Elon Musk’s failure

  • Musk pre-purchased Twitter 44 billion dollarspartly with Tesla shares.
  • He turned out to be despot.
  • Tesla lost 600 billion dollars market value.

A basketball team, a superyacht or a deserted island? None. Of all the things Elon Musk – until recently the richest person in the world – can buy, he chooses the loss-making messaging network Twitter. He makes a far too high bid of $44 billion in April and tries – unsuccessfully – to get out of it. In October, he walks into the Twitter office as the new owner, with the laundry and the pun ‘let it sink in’.

Musk surrounds himself on Twitter with his own vassals and tolerates no contradiction. He reveals himself as an impulsive despot who spreads conspiracy theories.

From his promise – he wanted to make Twitter a platform where you everything could say – a little back. Trump’s narrative may backfire, but Musk applies censorship as he sees fit. He kicks journalists off Twitter, bans links to other social media and deletes the account of anyone who shares his plane’s public location data.

Musk will fire half of Twitter’s employees in November. His controversial measures drive away advertisers – the main source of revenue. The introduction of a paid Twitter variant fails three times. Supervision and moderation are as limited as the EU is must intervene because Twitter no longer has the necessary resources to counter the spread of misinformation and hate speech.

You can rejoice in the failures of a multi-billionaire, but Twitter is in danger of losing a semi-public discussion space that is hard to replace. Not even by Mastodon.

The Twitter adventure is also affecting Musk’s other companies. To keep the messaging network up and running, he sells extra blocks of shares in Tesla. Last year Tesla was worth more than $1,000 billion – now $390 billion. Tesla doesn’t need an overworked boss who is busy on Twitter non-stop. Musk wants to quit as soon as he can find someone “crazy enough to [hem] to replace”.

The question for 2023: Who’s More Likely to Fall Over: Musk or Twitter?

Also read: The Twitter chaos gives the Dutch Mastodon servers wings

2 Bankman-Fried deception

  • Crypto exchange FTX went bankrupt.
  • Lost customers 8 billion dollars.
  • CEO Sam Bankman-Fried stayed arrestedaccomplices pleaded guilty.

The speculative mania in bitcoin and other digital currencies peaks during the corona crisis, when everyone is glued to the computer (‘buy all NFTs!’), in fear of missing out on the hype. 1.9 million Dutch people also invest money in cryptocurrencies.

One of the beacons of confidence in this shadowy world appears to be thirty-year-old American Sam Bankman-Fried’s (SBF) FTX empire. FTX, a major crypto exchange with a million customers, is theoretically worth $32 billion at the beginning of this year. But Bankman-Fried turns out to be a villain – not the benefactor he pretends to be.

Contrary to what SBF promises his clients, he uses their assets to (flash) trade bitcoins and even lesser-known currencies. A lot of jargon, but a little wool. This pyramid scheme is intended for speculation via the investment company Alameda. Losses are covered with even more customer money.

FTX is already faltering in May when the supposedly stable coin Terra collapses. Other crypto exchanges are more likely to fall, FTX falls through the ice in November when a report about the connection with Alameda emerges. Binance, the largest crypto exchange in the world, has lost confidence in FTX. Then everyone wants their money gone – but that’s probably not the case anymore.

FTX customers are losing an estimated $8 billion, including people who used to keep their retirement or education money. SBF is free on bail: he denies intent, his accomplice has already pleaded guilty.

The question for 2023: Where will the next crash take place? The crypto winter promises to be long and cold with much tighter oversight.

3Zuckerberg’s Black Hole

  • Record stock market losses: Meta lost in one day 232 billion dollars.
  • Zuckerberg lost 100 billion dollars of his own assets.
  • ‘Metaverse’ under construction suffers A loss of 10 billion Per year.

Who would have thought it big tech can only grow is wrong. Meta, the company behind Facebook, Instagram and Whatsapp, will lose two-thirds of its market value by 2022 (currently still $310 billion). Investors are not convinced by founder Mark Zuckerberg’s strategy.

In February, the Meta loses $232 billion in market value in one day: a record in the history of the US stock market. Zuckerberg loses 100 billion of his net worth. He also sees the departure of Sheryl Sandberg, the chief operating officer who oversaw Facebook’s growth for years.

Zuckerberg, sole ruler, lays off ten thousand Meta employees in November and barely cuts Reality Labs. It is the branch that builds the metaverse, a 3D version of the Internet. Can be visited with computer glasses (currently virtual reality and ‘mixed’ reality, where you can still see the surroundings to a certain extent). People float around like computer dolls. Ben doesn’t yet work in the metaverse; during the last demonstration in October they were played of ‘leg actors’.

The software rattles, the glasses are disappointing and after the pandemic the need to hang out in ‘cyberspace’ has cooled. But Zuckerberg won’t let go of the metaverse: Reality Labs is a black hole where $10 billion disappears every year. The old Facebook of privacy scandals and aggressive takeovers has not yet disappeared. On Friday, it was announced that Meta will settle for $725 million over the Cambridge Analytica scandal, and a European fine for abuse of power is still pending.

One bright spot: Due to the mess on Twitter and the growing discomfort with TikTok, Meta suddenly seems like the coolest kid in the class. If you set the bar low enough.

The question for 2023: Will Zuckerberg decide to make adjustments when he realizes that Reality Labs cannot escape economic reality?

Backstage will not be published in the first months of 2023 due to the author’s writing leave.

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