Can Twitter survive with significantly less staff?

Twitter reportedly reduced its staff by ~80%. Pundits have either praised Musk’s ability to run a lean company, or criticized him for leading the company towards an impending doom. He deserves neither, he is simply changing the business model from a growth business to a cash cow business.

Technology businesses in the recent decade tend to be growth businesses. They are experimenting with new products, inventing new technologies to scale, creating new frameworks. As an example, Twitter open sourced some truly high impact technologies like Bootstrap, Bower, Parquet, and many others. Growth businesses are expensive, because 80-90% of the investments yield no measurable impact. But no one has figured out how to identify the 10-20% that works. So there is a general spray and pray strategy for big tech.

Cash cow businesses are different. They are easy to operate, focused on the things that make money and keep the lights on. They don’t need a lot of staff to operate, but they also are likely not going to experience a lot of growth. Wall street tends to punish cash cow businesses. Because very few cash cow consumer technology businesses survive. They are unable to defend the business from competitors that innovate. But it also doesn’t mean that the demise will be swift. Very possible for Musk to recapture his investment by having modest cash flow over years or even decades.