Linda Yaccarino, Elon Musk, and the most difficult CEO job on earth
- Linda Yaccarino is tasked with fixing a product that Elon Musk seems to have intentionally broken.
- With Musk meddling, the CEO has limited power to influence the way X operates or where it’s headed.
- Ad industry execs have great respect for Yaccarino, but worry X has already become a lost cause.
Elon Musk announced the demise of the Western world’s most iconic social-media brand around midnight on a Saturday this summer.
“And soon we shall bid adieu to the twitter brand and, gradually, all the birds,” he tweeted for the final time, and quickly ordered that all blue and bird-themed decor be removed from Twitter offices in San Francisco, New York, and Los Angeles.
For the umpteenth time since Musk bought the company in 2022, the service became X, wiping away 17 years of brand equity, infuriating millions of users, and worrying advertisers. Employees were taken aback. While Musk had mentioned a “everything app,” this unexpected announcement was unexpected.
The actual CEO of the company was nowhere to be found, according to outside observers. When Musk dropped the weekend X bomb, Linda Yaccarino had only been on the job for about a month. She didn’t address the change publicly until late the next night, roughly 24 hours after Musk revealed it to the world.
According to X, Yaccarino pleaded with Musk to postpone the big announcement because she needed more time to prepare big advertisers.
“He did it anyway,” a source close to the situation said. “Musk completely undermines her.”
Welcome to the world’s most difficult CEO position.
Spoke with a number of current and former X employees, ad industry executives, and people familiar with the company and its operations to learn how Yaccarino has fared in her first few months. Many of the stories are terrifying for a well-known advertising executive who took a chance on leading a troubled company owned by the most volatile tech billionaire alive.
She’s been tasked with fixing a product that Musk appears to have purposefully broken, while having little power to influence how X operates or where it’s headed, according to these sources, the majority of whom asked not to be identified because they were discussing sensitive matters.
Some X employees believe Yaccarino is only a CEO in name. “Elon is in charge,” a current employee said.
Already, some ad industry observers are concerned that Yaccarino’s proximity to Musk and his chaotic X reign is tainting the solid reputation she spent decades cultivating among the world’s most powerful companies and their top executives.
“Even if she’s trying to do the right thing, she has an owner who makes the decisions,” said a former senior Twitter executive. “She can’t possibly win.”
“It must be very difficult to ensure she appeases Elon’s demands, needs, and expectations while also meeting the demands of advertisers,” said Matt Navarra, a social-media consultant.
Insider requested an interview with Yaccarino and sought comment from Musk and X. They didn’t say anything.
A successful precedent
While Musk can’t seem to stay out of the way and has replaced several Tesla CEOs over the years, there is precedent for success.
Gwynne Shotwell, president and COO of SpaceX, has demonstrated that Musk is capable of delegating some power and allowing a trusted ally to get things done. She must control Musk’s damage, fire employees who dare to speak out against him, and remember to never say no. However, a Musk-owned company can be run by someone other than Musk.
Yaccarino has had a lot on her plate in her first few months. She uses X on a regular and sane basis. She has negotiated deals with major vendors that Musk previously determined were not worth paying for. She resolved a problem involving unpaid commissions to the sales team. (Reducing “chaos,” as Navarra puts it.)
The CEO is working to get consistent live video on the platform. While Yaccarino has urged X employees to return to the office, she has done so without threatening to fire them, and she has taken a more upbeat and media-trained tone in public and with employees than Musk.
“Elon needs to get out of management,” one ad executive said. “If she fails, it will most likely be because Elon interfered or didn’t give her enough space.”
Yaccarino explained to employees in an email the Monday following Musk’s weekend rebranding that the name change was part of the platform’s mission to “impress the world all over again.” In a recent television interview, the CEO described “eight incredibly supportive weeks” with Musk and insisted on her “autonomy.”
Ad revenue decline and negative cash flow
In addition, the former NBCUniversal executive has met with marketing industry leaders. She recently reformed a “client council” of major brand advertisers and agency executives, who will meet in New York City on September 20 to hear about X’s roadmap and provide feedback.
However, Yaccarino has only scratched the surface of a massive problem. According to MediaRadar data, major companies such as Progressive, The Coca-Cola Company, General Motors, and AT&T reduced their Twitter ad spending by 90% to 100% in the first half of 2023. Other businesses reduced their platform marketing by 30% to 70%. Musk stated in July that advertising had dropped by 50% and that X was losing money.
Yaccarino has attempted to paint a more optimistic picture of X’s advertising business. In a CNBC interview earlier this month from X’s New York office, she said the company was nearing breakeven and touted new brand safety tools.
“She was clearly on message with talking points that built a case for reappraisal,” an ad industry executive said. Nonetheless, he added that the CEO’s arguments were “hard to reconcile with what I am observing on the platform, particularly in the area of trust and safety.”
“Device user seconds usage” and “Chadolf Rizzler”
Given her years of goodwill with the industry as one of the most high-profile names in ad sales, advertising executives want to give Yaccarino the benefit of the doubt. Inconsistencies between the numbers Musk and now Yaccarino publicly cite and what advertisers see on the platform are beginning to mount.
Yaccarino’s reposts and likes have helped Musk promote newly invented metrics like “device user seconds usage.” Advertisers prefer to track reach and success using more traditional metrics like daily active users, monthly active users, and click-through rates. The CEO did repost Musk’s tweet of an unmarked and undated graph purportedly showing 541 million monthly users. However, according to Apptopia data, the number of X monthly users at the end of July was around 396 million.
Since becoming CEO, Yaccarino’s most common refrain has been that “99%” of the content on X is “healthy.” This appears to be the result of a Sprinklr case study of 500,000 tweets between January and February. It discovered that 15% of those tweets contained one of 300 English slurs from a Twitter list. The study makes no claim that 99% of the content on the platform is healthy.
Several advertisers have reported seeing their ads appear alongside pro-Hitler content from accounts verified through X’s Blue subscription product. On August 22 and 23, Insider noticed ads for Sharpie, the PGA Tour, and the New York City Department of Transportation running on a Blue verified account named “Chadolf Rizzler,” an apparent nod to Adolf Hitler, which posts racist and other toxic content.
Stale beer during tea time
With X burdened by billions of dollars in debt, Yaccarino has limited resources to address these issues and turn the company’s fortunes around.
Yaccarino knew worker morale was low a few weeks into her official start as CEO in June, so she organized “tea time” gatherings in the New York office and at headquarters in San Francisco. It was the first time since Musk took over that employees had been invited to do anything other than work at all hours.
According to a person who attended the San Francisco gathering, Yaccarino attempted to motivate staff by talking about working as a team and building the future of X together. In a second-floor cafe, a few dozen employees talked among themselves, and occasionally with their CEO, while tea and other beverages were served.
It was a rare, unforced moment of relaxation during a workday at Musk’s company. However, one component left an unpleasant aftertaste. The free beer was “way past its expiration date,” according to the person.
“Linda says nothing”
Yaccarino has also had difficulty rallying X employees in other ways. According to a person familiar with the situation, Musk’s current schedule is to focus on Tesla and SpaceX in the first half of the week before moving on to X in the second half, including the entire weekend. “His important announcements are on Friday or Saturday,” said this source.
Weekend meetings can often last until 11 p.m., according to a former employee who is still in contact with current employees.
“He likes to punish employees by doing this stuff on holidays,” one of the workers explained. “The point is the cruelty.” Linda remains silent.”
Other employees said Yaccarino’s arrival at X has had little to no impact, particularly on those who do not work in ad sales or on ad products.
“Really, her title should be CMO,” one former employee, who is still in contact with current X employees, said. “Most people aren’t told anything in their daily lives by Linda.”
Two current X employees agreed, saying their new CEO has given them little to no direction since she took over about three months ago. When Twitter officially announced Yaccarino’s arrival in mid-May, it did so in a weekly email that only went to the ad and sales teams, leaving out all of engineering and tech, which make up the majority of the work force, according to the employees.
A lost cause?
For the time being, Yaccarino will be judged primarily by the health of X’s ad business, which still accounts for the vast majority of the company’s revenue. Even if Musk allows the CEO to lead, generating significant ad sales growth could be extremely difficult.
The harsh reality is that there are numerous other larger, higher-performing digital options for advertisers to consider, including Google, YouTube, Instagram, Facebook, and TikTok.
One ad agency executive stated that he has only heard positive things about Yaccarino, from her ability to lead to her relationships with the biggest advertisers. Nonetheless, the industry is beginning to regard X as a lost cause.
“She’s great, but this won’t work because Twitter is too big of a mess for anyone to clean up,” an agency executive explained.
Linda Yaccarino, Elon Musk, and the most difficult CEO job on earth
