Elon Musk said Twitter Inc. employees will receive stock grants based on an estimate of about $20 billion, less than half of the $44 billion price tag for which he bought the company last year.

Mr. Musk said in a memo to employees that he is optimistic about the future of the social media company. I see a clear but difficult path to a valuation of >$250 billion, meaning the stock acquired now will be worth 10 times that.

Mr. Musk also said in an email that Twitter is rebuilding so quickly that the company “could be seen as a reverse startup.” He said the sweeping changes were necessary, in part, to keep Twitter from going bankrupt.

The new valuation figure is a sign of the problems Twitter has faced since Mr. Musk’s takeover. Many major advertisers have stopped spending on the platform, putting Twitter’s main source of revenue into question, though the company is working to attract advertisers back.