Image: Heritage Global Partners
ARK Invest believes in Elon Musk's ability to make Twitter disruptive in the social media space. The firm is poised for a bumpy road, with Musk first having to change the structure before moving on to build the super app for everything.
Elon Musk's purchase of Twitter caused a lot of buzz. While some did not believe in his ability to run the social media platform, others actively supported him. ARK Invest was one of those who backed the acquisition because they believe in Musk's vision and his ability to create disruptive companies. The firm has a realistic view and is ready for a shake-up before Twitter becomes a disruptive social media platform.
“We didn’t think that this would be an overnight success when he went and acquired Twitter,” ARK Invest portfolio manager Nick Grous told Benzinga. “We knew it would be a bumpy ride.”
Grous said ARK Invest, which invested in the Twitter acquisition, has a long-term view of the company's success. According to him, one of Musk's visions is to turn Twitter into a super app like WeChat, which has not previously been popular in the US.
“Best use case is WeChat in China and how prolific its been to that population and to China in whole.”
Grous said Musk could solve the problem with Twitter, which is one of the reasons ARK Invest is optimistic about the future of Twitter. “We've always maintained our long-term outlook based on what Elon Musk has sought out to do,” he said. When Musk bought Twitter, the platform did not have the goal of being the super app for everything, so he needed to restructure it before he could get started.
Grous also spoke about what Twitter needs to do to grow video content in its monetization efforts. “The playbook has been written on how to engage with consumers when it comes to short-form video,” he said. Social media platforms have changed the way artificial intelligence is used for distribution, led by the efforts of TikTok. Prior to this, videos were shown to users based on the interests of their friends and the people they follow, which may not be the same. “This is going to change how people interact on social media, because of the way AI was integrated into the distribution of content,” Grous added.
He said Twitter should build its model on that, which can make video more scalable and keep people engaged longer. Grous noted that time spent on short content platforms like TikTok rivals time spent on long content from streaming platforms like Netflix Inc. in some cases.
“Don’t need to reinvent the wheel, Twitter needs to do what TikTok did.”
If done right, according to Grous, Twitter has a “real opportunity to be disruptive in the social media space.”
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About the Author
Eva Fox joined Tesmanian in 2019 to cover breaking news as an automotive journalist. The main topics that she covers are clean energy and electric vehicles. As a journalist, Eva is specialized in Tesla and topics related to the work and development of the company.