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The family office behind Musk’s $44 billion Twitter takeover

By Hyunjoo Jin and Elizabeth Dilts Marshall

(Reuters) – The small family office that manages the wealth of the world’s richest person and helps put together the biggest acquisition ever by one person is shrouded in secrecy.

On Monday, Musk reached a deal to buy Twitter Inc for $44 billion in a watershed moment for one of the world’s most influential public forums.

Musk – who is also the chief executive of electric car maker Tesla Inc and aerospace company SpaceX – revealed in a regulatory filing last week that the social media company should contact his family office as a point of contact regarding its proposed ‘acquisition.

Yet little is known about the Austin, Texas-based family office that manages Musk’s assets. The office is called Excession and the man who helped build it is Jared Birchall, a former Morgan Stanley banker who advised Musk on his interactions with Wall Street for several years, according to regulatory filings and legal documents. He also hired an investigator to investigate a critic of Musk who Musk called a “pedo guy” in 2018, according to court documents.

Born in 1974, Birchall was hired by Morgan Stanley’s Musk in 2016 to work for his family office. Birchall is also chief executive of Musk’s brain chip company Neuralink, director of Musk’s tunneling company The Boring Company, and a board member of Musk’s private philanthropic foundation.

Business registration records with the Texas Comptroller of the Public Accounts list Birchall as a director of Excession as recently as 2021.

Birchall and Musk did not respond to requests for comment.

Birchall’s multiple roles are rare for a family office manager and illustrate Musk’s confidence in himself, said Raphael Amit, professor of management at the Wharton School.

“Once you appoint someone to run the family office, it means you trust them. And Elon wants to set it up in a way that allows him (Birchall) maximum control.”

MORGAN STANLEY AS “BEST RESOURCE”

Morgan Stanley led the financial package for Musk’s offer on Twitter and advised Musk on the success of the deal, culminating several years of a relationship the two have built and strengthened by Birchall.

A day after Musk tweeted in August 2018 that Goldman Sachs and Silver Lake would handle his ultimately failed effort to take Tesla private, Birchall sent a message to Musk encouraging a Morgan Stanley role.

“They have been by far our best resource on a personal level. They provide you with the largest ($350 million) of any line and every time we pressed them for more borrowing power or a lower rate , they came through,” he wrote, according to documents leaked during a trial over tweets by Musk that he was considering taking Tesla private.

Musk replied, “That seems fair.”

NO REGULATORY CONTROL

“Excession” is also the title of a sci-fi novel by Iain M. Banks about artificial intelligence that Musk was seen wearing at a conference in Sun Valley, Idaho, in 2015.

Excession, the company was made up of “essentially two people” in 2019, Musk said during a defamation lawsuit in federal court in Los Angeles at the time. The second person is unknown.

It’s not unusual for a small group of people to run a family office, industry sources said, although by contrast, billionaire Jeff Bezos’ family office is said to have more than 100 people.

There is no regulatory requirement for family offices to publicly disclose their assets or key personnel, and Excession’s holdings and the value of its assets and number of employees could not be known.

A graduate of Brigham Young University, Birchall began his career at Goldman Sachs Group Inc in New York in 1999 as a financial analyst, according to his LinkedIn profile. He then joined Merrill Lynch in Los Angeles for ten years as a wealth manager.

Merrill Lynch fired Birchall in 2010 for “conduct resulting in loss of trust by management” which included “sending correspondence to a client without management’s approval,” according to Financial Industry Regulatory Authority records ( FINRA). Reuters could not obtain further details about Birchall’s dismissal, and FINRA and Merrill Lynch did not respond to requests for comment.

Less than a month later, Birchall started working at Morgan Stanley as a wealth manager.

A Morgan Stanley spokesperson said Birchall was well regarded while working at the bank and left on good terms.

‘PROTECT THE MUSK’

Birchall’s role extended beyond finance.

In 2018, he hired a private investigator to investigate a British diver who criticized Musk’s idea of ​​using SpaceX’s mini-submarine to rescue a boys’ football team trapped in a cave in Thailand, according to court documents.

When Musk called the diver a “pedo guy” in a response on Twitter, the diver sued him for defamation. At the ensuing trial, it emerged that Birchall, named James Brickhouse, had hired a private detective to investigate the diver. Birchall said in court testimony that he had “the instinct to protect Musk.”

Musk won the case.

“The idea of ​​loyalty, especially in the family office, is deeply important, said Amit of the Wharton School. “Because you are exposed to the most intimate and private issues of families.

(Reporting by Hyunjoo Jin in San Francisco and Elizabeth Dilts in New York, with additional reporting by Krystal Hu in New York and Michelle Price in Washington; Editing by Peter Henderson, Greg Roumeliotis and Matthew Lewis)