4 The Sunday Times April 24, 2022
BUSINESS
In the
minds
of many,
Dorsey’s
words
carry
extra
weight
J
ack Dorsey, the billionaire
founder of Twitter, once told an
interviewer that his weakness as
a leader was that he was a “silent
person”. He said: “People often
find it pretty unsettling... They
intend to know my thoughts but
I prefer staying silent most of
the time.”
Amid the $43 billion fight for
Twitter’s soul that has broken out
between Elon Musk and the company’s
board of directors, Dorsey has started to
speak up — via Twitter, naturally.
After the company approved a “poison
pill” this month to see off Musk’s unsolic-
ited takeover bid, Dorsey wrote that the
board had “consistently been the dys-
function of the company”. In response to
another post of a Silicon Valley proverb
saying that “good boards don’t create
good companies, but a bad board will kill
a company every time”, Dorsey
responded: “Big facts.”
The messages were telling; an indica-
tion that the 11-member board, upon
which Dorsey still sits, was perhaps not as
harmonious as it might seem. Dorsey
owns just 2 per cent of Twitter. Next
month the 45-year-old is set to step down
from the board, 16 years after he
co-founded the company. Yet in the
minds of many employees, and some of
his fellow board members, he and Twit-
ter are almost one and the same. His
words carry extra weight.
David Friedberg, a Silicon Valley inves-
tor, summed up this view last week. “Jack
is the linchpin in what is going to happen
here. His point of view on whether he
[Musk] should be the steward of this busi-
ness going forward is gonna sway a big
part of how this process is going to go,”
Friedberg said on the All-In podcast.
When Musk tabled his $54.20-a-share
bid this month, it electrified the markets.
But it was also met with scepticism. The
famously mercurial billionaire had not
shown any proof that, despite his
$270 billion fortune, he could get the
money together for the bid. Most of his
wealth is tied up in the shares of Tesla and
SpaceX, his rocket company.O
n Thursday, however, he unveiled
his financing plan: a $12.5 billion
personal loan secured by Tesla
shares, $13 billion in debt secured
against Twitter, and $21 billion in
cash from himself and any other inves-
tors he brings along. It would be the larg-
est leveraged buyout in history, and
partly financed by what could be the larg-
est personal loan in history.
Bloomberg’s Matt Levine wrote: “The
board’s best argument for blowing off
Musk... was probably that he was hard to
take seriously without real financing.
Now it has to take him seriously.”
In the middle sits Dorsey, an eccentric,
inscrutable billionaire who, in recent
years, has formed a bromance with Musk.
The pair share an enthusiasm for crypto-
currency, even joining a podcast together
to rhapsodise about the potential of
“internet-native currency”. When Musk’s
Twitter account was hacked, he called his
friend, who froze the account in minutes
until it could be restored.
Faced with a coup attempt by activist
investor Elliott Management in 2020,
Musk tweeted in defence of Dorsey: “Justwant [to] say that I support Jack as Twitter
CEO. He has a good heart.” Dorsey
returned the favour this month when
Musk broke cover to announce he had
snapped up 9 per cent of Twitter’s stock.
He wrote: “I’m really happy Elon is join-
ing the Twitter board! He cares deeply
about our world and Twitter’s role in it.”
Days later, of course, Musk U-turned.
He declined the board seat, tabled his bid
and publicly declared his lack of confi-
dence in chief executive Parag Agrawal,
who Dorsey had handpicked as his suc-
cessor in November.
Beyond Dorsey’s fiduciary duty, which
requires him to vote on the plan most
likely to deliver for shareholders, he will
have to decide where his personal alle-
giance lies. Upon announcing Agrawal’s
appointment last year, Dorsey wrote that
the 37-year-old Indian was “behind every
critical decision that turned the company
around”. He added: “He leads with heart
and soul, and I learn from him daily. My
trust in him as CEO is bone deep.” Musk,
should he bag Twitter, will fire Agrawal.
Along with his bid, he wrote tartly: “I
don’t have confidence in management.”
Indeed, should Musk succeed,
Agrawal would most likely be one casu-
alty of many. Musk, famously a worka-
holic, sleeping on Tesla’s factory floor for
months at a time, is expected to take a
sledgehammer to the culture of Twitter.
With its monthly “day of rest” and the
pliant “work from anywhere” model it
offers employees, Twitter is a manifesta-
tion of Dorsey’s sensibilities come to life.
The self-taught programmer wrote the
code for Twitter in 2006, inspired by thebursts of chatter used by police and the
emergency services that he spent a lonely
youth eavesdropping on via a police scan-
ner he had at his home. As chief execu-
tive, however, he struggled. In 2008 he
was forced out after the board tired of his
erratic management and his penchant for
taking time out to indulge other interests,
such as hot yoga and sewing.
He returned in 2015 after Twitter had
cycled through another couple of chief
executives, against a backdrop of Game of
Thrones-style boardroom jockeying. As a
business, it struggled, racking up losses
year after year and struggling to innovate.
One insider said the company was
“typified by inaction”, with big decisionsMusk is likely to
turn Dorsey’s
Twitter culture
upside down if he
takes the reinsSEASON FOUR OF
DANNY IN THE VALLEYSECOND LIFE’S
PHILIP ROSEDALE:
‘METAVERSE
MILLIONAIRES’
THESUNDAYTIMES.CO.UK/DANNYINTHEVALLEYTECH TALK
Twitter co-founder Jack Dorsey faces a stark choice: endorse his pal Elon Musk‘s takeover, or side with his handpicked successor
D-Day for the techno-shaman
debated for weeks or months before
being finally delayed, sometimes indefi-
nitely, by Dorsey. The pace of innovation
in the later years of Dorsey’s tenure at
Twitter increased and he even managed
to tip the company into profit for a couple
of years — 2018 and 2019.U
nder Dorsey, however, Twitter also
struggled to grapple with content
moderation, which appears to be
the main driver for Musk’s bid. The
world’s richest man said the plat-
form is the “de facto town square” and
should adhere firmly to free speech prin-
ciples. This would probably mean remov-
ing the guardrails that Dorsey and his
team have put into place in recent years.
These days Dorsey can be seen walk-
ing to the headquarters of Block, the
$65bn payments giant he founded across
the street from Twitter in downtown San
Francisco, often in all black, with a
shaved head, nose ring and lengthening
beard. Once clean-cut, he has taken on
the vibe of techno-shaman, favouring a
certain manicured shabbiness that belies
a net worth estimated at $6.7 billion.
As Musk raises the pressure, Dorsey
must decide: does he throw his outsized
influence behind Musk’s hostile takeover,
and allow the Tesla tycoon to turn the
company upside down, and the culture
he instilled inside out? Or does he spurn
his billionaire bestie and side with
Agrawal, betting that the newbie can
finally turn Twitter around and, crucially,
get the share price reliably back up above
the $54.20 price Musk has tabled.
Only Dorsey knows what he is thinking.Powering up: the
race for lithium
On the windswept coast of
southern Greenland, giant
drills will soon splutter into
life and begin burrowing into
the earth. Three thousand
miles away, a functionary in a
long-dead department in
Washington DC has just
signed a big cheque to fund a
new manufacturing plant on
the Mississippi River in
Louisiana. In Yichun, an
industrial city in the Jiangxi
province of China,
construction crews were
frantically erecting a
$2 billion megafactory.
All are manoeuvres in a
high-stakes race to own and
control the core technology
that will dominate the next
century in the way that oil
dominated the last: batteries.
Lithium-ion batteries are at
the heart of the electrification
of cars, energy production
and heating that scientists say
is needed to cut carbon
emissions and see off
catastrophic climate change.
Yet supplies of the raw
materials — especially lithium
— and the manufacturing
capability to turn them into
batteries are in the hands of
political adversaries and
already under strain from
soaring demand.
The cost of lithium has risen
sixfold from $12,000 a tonne
in 2017, to more than $78,000
today. The prices of the other
key battery elements have also
jumped. Nickel prices have
tripled, cobalt has risen by
two-thirds, while copper has
almost doubled over the
period. This month, Tesla
chief Elon Musk raised the
possibility of the electric car
giant setting up its own mining
operation so as to have more
control over its destiny.
RJ Scaringe, founder of the
$30 billion (£23 billion)
electric truck start-up Rivian,
said the semiconductor
shortage that has convulsed
the global economy is a “small
appetiser” compared with the
coming battery crunch.
The challenge includes raw
materials as well as
manufacturing capacity. By
2030, it is projected that the
world will need to produce
one million tonnes of lithium
annually to meet demand — a
36-fold hike. Manufacturing is
even more daunting. Musk
said that by 2050, the world
will need 300 terawatt hours
of battery production capacity
— a 200-fold increase on the1,500 gigawatts of global
capacity. Battery production,
he added, “will be the limiting
factor on progress towards
sustainability”.
Even more worrying for
the West is that China rules
the market, with 80 per cent
of battery cell production
capacity, and dominant
positions in lithium refining
and component production,
according to BloombergNEF.
This has been the result of
a decades-long initiative,
which has put at least
$60 billion into building up
domestic miners, processors
and manufacturers. Of the
299 battery “megafactories”
slated between now and
2030, says Benchmark
Mineral Intelligence, 221 are
in China. The upshot: it is at
the controls of a key part of
the future economy.
It’s not just lithium where
the West does not call the
shots. The world’s cheapest
nickel producer, and one of
the largest, is Russia’s Norilsk.
Rebalancing that picture
has become a priority.
Indeed, the US Department of
Energy dusted off its
Advanced Technology
Vehicles Manufacturing fund
this month, which has been
dormant for a decade, to
offer a $107 million loan to a
company seeking to build a
facility in Vidalia, Louisville,
to make battery materials.
Meanwhile, Gavin Newsom,
governor of California, has
vowed to turn the state into
the “Saudi Arabia of lithium”.
It has some undeveloped
deposits and hopes to tempt
manufacturers by becoming a
leader in green energy and
transport. The state unveiled
a proposal this month to ban
petrol-powered cars by 2035.
Kurt House is founder of
KoBold, a start-up backed by
Jeff Bezos and Bill Gates’s
Breakthrough Energy that
uses algorithms to map the
Earth’s crust, and discover
deposits of battery materials.
He said the battery crunch
“was obvious in 2018”,
adding: “This is why we
started the company. The
world has two choices: we
either electrify the economy
or fry the planet.”
KoBold began drilling last
month on land in Greenland
that it, along with London-
listed partner Bluejay Mining,
reckons could hold $1 trillion
in battery minerals.DANNY FORTSON IN SAN FRANCISCO
ILLUSTRATION: TONY BELLAlthough the pandemic
brought increased appetite
for the company’s homes,
which tend to be built in the
Oxfordshire commuter belt, it
also unleashed a wave of
complaints from customers.
A commuter who used to “get
up in the morning and go to
work” is now sitting there
“staring at a crack all day”.
Booth stepped back from
the day-to-day running of the
business in May 2021, passing
the reins to Andy Morris, now
managing director of
Hayfield, and Paul Breen,
who runs Living Space. He is
trying to find the right
balance between letting them
“make some mistakes and
learn it for themselves” but
still “steering them” in the
right direction.
The entrepreneur said he
still gets his biggest thrill from
seeing people moving into
their new homes. “It’s just
something I really get a kick
out of ... it’s a great feeling.”underfloor heating and
electric car charging points,
which come as standard.
Another reason for
Hayfield’s popularity among
customers, said Booth, is that
its houses are all built to the
same specification as its
showrooms. Most other
builders will charge “£20,000
to £50,000” for upgrades, he
added, pointing out that it
“feels disingenuous” to show
buyers a higher specification
than they might actually get.
A big challenge for the
firm’s cashflow is sites being
tied up for years in planning
disputes. Hayfield currently
has four sites where local
residents have mobilised.
“Every one of those schemes
was consented by the
[planning] officers ... and
then it goes to the politicians
and gets refused. That causes
a 12-month or two-year delay
because you’ve got to go to
appeal and you’ve got to
spend another £100,000.”next stage of its expansion.
Booth attributes his firm’s
success so far, at least in part,
to its credentials among eco-
conscious consumers. In
2020, Hayfield decided to
improve the energy efficiency
of its properties by installing
air-source heat pumps,want it and are very rich.
They... employ planning
consultants and barristers.”
After Banner was sold to
Cala Homes in 2014, Booth
decided to go into business
on his own, launching both
Hayfield and Terra,which
buys plots of land and obtains
planning consent before
selling them on to developers
— either to Hayfield, sister
firm Living Space, an
affordable housing business
launched a few years later, or
to third-party housebuilders.
Initially funded by US
private equity firm Castlelake,
Hayfield has since extricated
itself from the relationship.
“We bought our first five or
six sites with them, and it was
going okay. And then we had
Brexit and the fallout from
that was that this... fund felt
UK [housebuilding] was not a
place they wanted to be. We
put a couple of sites to them
we wanted to buy in 2018, and
they just said no. There wasA
s the founder and
chairman of luxury
property developer
Hayfield Homes, Mark
Booth has developed an
eye for detail in construction.
But his own childhood was in
less salubrious surroundings.
“The house I grew up in
was a two-up, two-down
terraced house [in Salford,
Greater Manchester] with an
outside toilet and a slot
machine to put your 50p
[pieces] in for your electrics,”
recalled Booth, now 56.
“The only way we got hot
water was [by pushing] this
thing down on the fire with astick, and that then heated
the boiler up behind the fire.”
He has come a long way
since. After years spent
learning about land buying
and house building, in 2015
he started Hayfield, which
sells family homes costing, on
average,£550,000. In 2021, it
had sales of £95 million, and
for this year it is forecasting
sales of £150 million with a
profit of £24 million.
Pursuing a career in
construction was natural for
Booth; he had been on
building sites since he was
“eight or nine” with his
father, who was a carpenter
by trade and also worked as a
site manager.
He won a place to study
mechanical engineering at aMy first house had an outside toilet. Now I build luxury homes
local college but left after
three months after realising it
wasn’t the course for him. He
got a job with local builder
Broseley Estates at the age of
16 and “fell in love” with the
industry. Later, in the mid
1990s, he joined Bryant
Homes as an engineer and
technical manager, before
becoming technical director
at Miller Homes in 1999. He
continued to climb the ranks,
with management roles at
Dodd Homes and Banner
Homes. Regular relocation
came with the territory,
Booth said. “They move you
about a lot to test your mettle
and to help you understand
the market from different
viewpoints.”
A move to Manchester with
Banner was indeed testing
when local residents opposed
a new-build development.
“It’s quite complicated
because you’re building ... in
aspirational locations where
surrounding owners don’tHOW I MADE IT
MARK BOOTH
FOUNDER OF HAYFIELD HOMESHannah Prevett
Deputy editor, Times
Enterprise NetworkPlanning disputes have been a challenge for Mark Boothno justification as all the
metrics worked really well.”
After parting company
with Castlelake, the Solihull-
based Hayfield said in 2020
that it had secured
£85 million in funding from
OakNorth Bank and a Dubai
private investor to help the
CHRIS RADBURN THE SUNDAY TIMES