Elon Musk is buying Twitter. Here’s what comes next

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Musk’s $44 billion bid for Twitter, which was accepted unanimously by the board late yesterday afternoon, will be the third-largest technology acquisition in history (There have been a series of non-tech deals much bigger). If you remember from yesterday’s newsletter, nearly half of that figure was put up my Musk himself—the remaining sum secured from Morgan Stanley, Bank of America, Barclays, and others.

So where does all this leave us? It’s been rather intriguing to see the investment world react—with VCs offering congratulations as they often do when a peer exits a portfolio company. A host of investors seem to believe that a Musk-era will usher in a new age of free speech on Twitter. You also have the camp of Jack Dorsey, Twitter’s co-founder and current board member, who says that taking Twitter back from Wall Street “is the correct first step” after the social media network’s era running under an advertising model.

“I continue to believe that a single person owning one of the most important communications protocols of the internet is a bad idea, but maybe it can be a bridge to something better,” Union Square Ventures partner Fred Wilson said in his newsletter this morning. “Certainly being a public company has not been the right ownership model to make the big fundamental changes which are badly needed.”

But let’s talk about free speech. 

Social media, just as it has brought people and new voices to the table, has also become a daunting—and in many cases, a downright dangerous—haven of the internet. In 2020, 81 countries used social media to spread computational propaganda and disinformation about politics, a University of Oxford research project found. You can readily find impersonators, predators, harassers, racism, hate speech, and discrimination, despite widespread efforts to shut this kind of behavior down. Disinformation has run rampant during the COVID pandemic, leading people to neglect proper precautions at the onslaught of the pandemic, and later, making many hesitant about vaccines.

Twitter has certainly wrestled with these problems. The network made a landmark decision to ban former President Donald Trump from its platform last year after the company determined that his tweets had violated their policies and incited violence during the Capitol riots on Jan. 6. It’s a decision that sparked widespread controversy and became a symbol to a much larger, decades-old question: Where exactly should a company draw the line?

The reality is that free speech simply isn’t clear cut. Twitter’s efforts to get its arms around the issue have often felt sporadic, and Musk, for one, hasn’t held back his disapproval.

But is Musk the one to fix it? Musk himself doesn’t have a great track record on this front. He may be a substantial donor to the American Civil Liberties Union and tout the benefits of free speech on social media platforms, but he’s less than tolerant of critique against himself or his companies—especially from those who work for him.

Earlier this year, Tesla terminated an employee mere days after he posted a video to YouTube that showed his self-driving Tesla running into a traffic cone. A Bloomberg investigation in 2019 revealed that Musk personally set out to take down a Tesla whistleblower, who had stated to the press that inefficiencies at the company’s Nevada battery plant was costing Tesla around $150 million. Tesla’s PR department allegedly spread rumors that the whistleblower was homicidal and had planned shooting at a Tesla factory, and Musk questioned on Twitter whether the Business Insider reporter was an inside trading source for Tesla short-sellers and stated that an ex-Tesla employee went on record stating that she had bribed him.

Let’s not forget how Musk himself has used the platform: Famously, he called the British diver who helped rescue the 12 boys trapped in the Thailand cave a “pedo guy” on Twitter after the diver had referred to Musk’s offer to help as a “PR stunt” (it was later revealed that Musk also went on to hire a private investigator to dig into his background).

All of this makes you question the sentiment behind Musk’s tweet yesterday morning: “I hope that even my worst critics remain on Twitter, because that is what free speech means.”

But when it comes to Twitter’s business itself, some of Musk’s initial ideas for Twitter are really interesting, though they are just that at this point: Ideas. Musk has said he wants to open up Twitter’s algorithm, so that everyone can see which tweets are promoted and which are hidden from feeds. Should that pan out, it would make the platform much more transparent. Musk also plans to take aim at the plethora of bots and crypto scammers roaming the platform, and he has suggested putting less emphasis on ads in the company’s revenue model. Should he succeed, the user experience could really improve. And perhaps it could give Twitter the momentum to gain more market share against much-larger social competitors like Facebook.

Either way, we can expect Twitter to disclose far less information to the public in the future as a private company. Whether or not Twitter’s algos make their way into the public domain, far less of its business operations will. 

See you tomorrow,

Jessica Mathews
Twitter: @jessicakmathews
Email: jessica.mathews@fortune.com
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Jackson Fordyce curated the deals section of today’s newsletter.

VENTURE DEALS

– SonarSource, a Geneva-based clean code platform, raised $412 million in funding. Advent International and General Catalyst led the round and were joined by investors including Insight Partners and Permira’s Growth Opportunities Fund. 

– Harness, a San Francisco-based software delivery platform, raised $175 million in Series D funding led by Norwest Venture Partners and was joined by investors including J.P. Morgan, Capital One Ventures, Splunk Ventures, Adage Capital Partners, Balyasny Asset Management, Gaingels, Harmonic Growth Partners, ServiceNow, Menlo Ventures, IVP, Unusual Ventures, Citi Ventures, Battery Ventures, Alkeon Capital, GV, Sorenson Capital, Thomvest Ventures, and Silicon Valley Bank. 

– Pollen, a London and Los Angeles-based travel and entertainment technology company, raised $150 million in Series C funding from investors including Kindred, Lansdowne Partners, Northzone, Sienna Capital, Backed, and Molten Ventures.

– HARTBEAT, an Encino, Calif.-based multi-platform media company from Kevin Hart, raised $100 million in funding from Abry Partners.

– Qualified, a San Francisco-based lead generation platform, raised $95 million in Series C funding led by Sapphire and was joined by investors including Tiger Global, Norwest Venture Partners, Redpoint Ventures, and Salesforce Ventures. 

– Replicant, a San Francisco-based contact center automation company, raised $78 million in Series B funding led by Stripes and was joined by investors including Salesforce Ventures, IronGrey, Omega Venture Partners, Norwest, and Atomic.

– Pheast, a Palo Alto, Calif.-based preclinical stage immuno-oncology company, raised $76 million in Series A funding led by Catalio Capital Management and ARCH Venture Partners.

– RelationalAI, a Berkeley, Calif.-based intelligence data apps developer, raised $75 million in Series B funding led by Tiger Global and was joined by investors including Madrona Venture Group, Addition, and Menlo Ventures.

– Anuvia, a Winter Garden, Fla.-based fertilizer manufacturer for the agriculture, turf, and lawncare industries, raised $65.5 million in Series D funding led by Piva Capital and Riverstone Holdings and was joined by investors including Morgan Stanley Investment Management, LK Advisers Limited, and Pontifax Global Food and Agriculture Technology Fund. 

– Upside, a Washington D.C.-based retail technology company, raised $65 million in funding from investors including General Catalyst, Bessemer Ventures, and Builders VC. 

– QuotaPath, an Austin and Philadelphia-based commissions tracking and automation solution for sales and revenue teams, raised $41 million in Series B funding led by Tribe Capital and was joined by investors including Insight Partners, ATX Venture Partners, Stage 2 Capital, and Integr8d Capital.

– Copper, a Seattle-based banking account and debit card company for teens, raised $29 million in Series A funding led by Fiat Ventures and was joined by investors including Panoramic Ventures, Insight Partners, Invesco Private Capital, and others. 

– Source Defense, a Rosh Haayin, Israel-based web application protection company, raised $27 million in Series B funding led by Springtide Ventures and was joined by investors including Jerusalem Venture Partners, AllegisCyber Capital, Global Brain, Connecticut Innovations, NightDragon, and Capital One Ventures.

– Food Rocket, a Chicago-based grocery delivery service, raised $25 million in Series A funding led by Alimentation Couche-Tard. 

– Intigriti, a Brussels-based hacking and bug bounty platform, raised €21.1 million ($22.6 million) in Series B funding led by Octopus Ventures and was joined by investors including EnBW New Ventures and ETF Partners. 

– Conjura, a Dublin-based e-commerce data analytics platform, raised €15 million ($16 million) in Series A funding. Act Venture Capital and MiddleGame Ventures co-led the round and were joined by Tribal VC. 

– Crafty, a Chicago-based workplace management platform for food, beverage, and supplies for employees, raised $10 million in Series A funding led by Tribeca Venture Partners and was joined by investors including Greycroft, OCA Ventures, Gaingels, 7BC, and Bluestein Ventures.

– InZiv, a Jerusalem, Israel-based inspection and repairer of microLED, QLED, and OLED displays, raised $10 million in a Series A1 funding led by BlueRed Partners and was joined by investors including OurCrowd and others. 

– Mad Realities, a New York-based crypto media company, raised $6 million in seed funding led by Paradigm and was joined by Paris Hilton’s 11:11 Media and others.

– Afterparty, a Los Angeles-based NFT community building platform, raised $4 million in funding from investors including Paris Hilton, The Syndicate’s Jason Calacanis, Blockchange Ventures, Acrew Capital, and others. 

– HireLogic, a Dallas-based HR software firm for the interview process, raised $4 million in seed funding from investors including former CEO and chairman of the board of Motorola Edward J. Zander, partner at Guidepost Growth Equity and former president of Razorfish Mike Pehl, and CEO of Ritchie Bros. Ann Fandozzi.

– Juno, a London-based employee benefits platform, raised $4 million in funding led by Hoxton Ventures and was joined by angels including the CEO of OysterHR Tony Jamous, CEO of Paddle Christian Owens, and other angels.

– OneVest, a Calgary and Toronto-based wealth management platform for fintechs, digital banks, and financial institutions, raised CAD $5 million ($3.91 million) in seed funding led by Luge Capital and was joined by investors including OMERS Ventures, AAF Management, FJ Labs, NAventures, Panache Ventures, and other angels.

– Mirai Flights, a London-based private jet booking platform, raised $3 million in funding from Xploration Capital. 

– Charityvest, an Atlanta-based charitable giving account company, raised $2.2 million in seed extension funding from investors including CEO of Jackson Healthcare Rick Jackson, DURO VC, and CEO of UMANA Family Office Ba Minuzzi.

– smedo, a Hennigsdorf, Germany-based research company for cardiological diseases, raised €1.66 million ($1.77 million) in seed funding from investors including APEX Ventures and Brandenburg Kapital.

PRIVATE EQUITY

– ​​New State Capital Partners acquired a majority stake in Patuxent Roofing & Contracting, a Laurel, Md.-based re-roofing installation and services provider. Financial terms were not disclosed.

EXITS

– CapVest Partners acquired Second Nature Brands, a Detroit-based platform of snacks and treats brands, from Palladium Equity Partners. Financial terms were not disclosed. 

– Sterling Investment Partners acquired Kendall Vegetation Services, a Lawrenceville, Ga.-based vegetation management services provider, from Blue Point Capital Partners. Financial terms were not disclosed. 

OTHER

– Descartes acquired Foxtrot, a San Francisco-based delivery logistics software company for beverage, food, and ecommerce companies, for $4 million. 

– ClickUp acquired Slapdash, a London, San Francisco, and Toronto-based search and command bar platform. Financial terms were not disclosed.

– Swvl Holdings agreed to acquire Volt Lines, an Istanbul-based transportation-as-a-service operator. Financial terms were not disclosed.

FUNDS + FUNDS OF FUNDS

– Left Lane Capital, the New York-based venture capital firm, raised $1.4 billion for its second fund focused on global internet and consumer technology businesses.

– Slow Ventures, a Boston and San Francisco-based venture capital firm, raised $325 million for two funds. Its fifth seed fund raised $195 million and is focused on seed and pre-seed companies. Its second opportunity fund raised $130 million and is focused on later staged companies.

– Cambridge Innovation Capital, a Cambridge, U.K.-based investment firm, raised $300 million for a second fund focused on companies in the deep tech and life sciences sectors.

PEOPLE

– Slow Ventures, a Boston and San Francisco-based venture capital firm, hired Megan Lightcap, Clay Robbins, and Yoni Rechtman as investors. Formerly, Lightcap was with Olive and L Catterton, Robbins was with 0x Labs and Square, and Rechtman was with Tusk Ventures.

– SoftBank, a Tokyo-based venture capital firm, promoted Dami Osunsanya to director of the SoftBank Opportunity Fund.