Twitter will put Elon Musk on its board, a transfer that comes not more than a day after Musk revealed a brand new billion-dollar place within the firm making him its largest shareholder. The choice probably hopes to forestall a prolonged public battle over Twitter’s future.

“I’m excited to share that we’re appointing @elonmusk to our board!” Twitter CEO Parag Agrawal wrote on Twitter. “Via conversations with Elon in current weeks, it grew to become clear to us that he would convey nice worth to our Board.” Musk, the billionaire CEO of Tesla and SpaceX, responded along with his personal optimistic sentiment. “Trying ahead to working with Parag & Twitter board to make vital enhancements to Twitter in coming months!” he stated in a tweet-reply to Agrawal.

Musk’s time period as a director will final till 2024, and below the brand new settlement with Twitter, Musk is prohibited from buying greater than 14.9% of the corporate, a clause meant to restrict how a lot energy he can wield over Twitter.

Musk on Monday disclosed a stake in Twitter value roughly $3 billion, some 9.2% of the corporate’s shares. The massive funding immediately turned Musk, a preferred presence on the social media website, right into a presence the company couldn’t ignore until it needed to danger Musk making a push to overturn its management. Agrawal grew to become CEO in November, taking on the job from the departing Jack Dorsey.

“This was a pleasant transfer by the Twitter board to embrace Musk with open arms,” says Wedbush analyst Dan Ives. “We consider Musk becoming a member of Twitter will result in a number of strategic initiatives which may embody a spread of near-term and long-term potentialities out of the gates for the corporate. Now it’s time to get out the popcorn and watch the developments over the approaching months with Musk on the board.”

Musk has stated he desires Twitter to follow higher free-speech insurance policies and scale back moderation makes an attempt, concepts operating counter to what Twitter and others like Meta have executed over the past a number of years. He has additionally described a need for Twitter to grow to be extra decentralized, opening up its algorithm and permitting customers to customise how content material shows of their feeds, proposals that do fall extra according to related concepts from Agrawal and Dorsey.

Dorsey additionally voiced help for Musk’s new function on Twitter’s board on Tuesday. “Parag and Elon each lead with their hearts,” Dorsey tweeted, “and they are going to be an unimaginable group.”

By embracing Musk and giving him a board seat, Twitter hopes to keep away from what has occurred to different corporations when properly funded and aggressive traders take up funding stakes: protracted campaigns by these shareholders that sow confusion and doubt in regards to the firm’s future.

Twitter fended off considered one of a lot of these traders in 2020, and it used the same playbook to the one it has deployed now with Musk. In March 2020, Elliott Administration took a stake in Twitter, and the activist-investor agency swiftly unveiled an inventory of hanging calls for, together with one advocating for Dorsey’s departure. Twitter reached a take care of Elliott in lower than a month, giving it a board seat.

Dorsey obtained to maintain his job—lengthy sufficient to handpick his successor, Agrawal. He additionally heeded different Elliott considerations: quicker, extra bold development targets and product improvement. Twitter has stated it hopes to have $7.5 billion in annual income and 315 million customers by subsequent yr, markers that stay signficant leaps past its present ranges. Wedbush analyst Ives notes Twitter is “nonetheless struggling in a social media arms race,” a contest together with Fb guardian firm Meta and Snap.

Buyers have preferred what they’ve seen to date. Twitter inventory rose almost 30% on Monday and climbed one other 6.5% in pre-market buying and selling on Tuesday. The skyrocketing shares have pushed Musk’s fortune previous $300 billion—additional padding his place because the world’s richest particular person—and added tens of thousands and thousands to the online worths of Dorsey and one other departed Twitter cofounder Ev Williams.

As quickly as Monday night, it was clear Musk had gotten Twitter’s consideration. Musk launched a ballot on his Twitter account, asking his followers whether or not they needed an edit button added to Twitter, a function many have beforehand needed. Resoundingly, they answered within the affirmative. Agrawal then retweeted Musk’s ballot, one of many solely occasions he’s posted to Twitter since turning into CEO in November.

“The implications of this ballot will likely be essential,” Agrawal wrote within the retweet. “Please vote rigorously.”