It is less than half of $44 billion for which Musk acquired the micro-blogging platform, reports The Wall Street Journal.
"I see a clear, but difficult, path to a >$250B valuation," he told employees in an email.
He said that Twitter is being reshaped so that the company "can be thought of as an inverse startup."
Also Read: Twitter to soon increase long-form tweets to 10k characters: Musk
In a separate email, Twitter told employees it is offering new equity grants to staff that will start to vest after six months.
In about a year, the company will offer a liquidity event in which they can cash out some of that equity.
The new grants will vest over four years, according to the Journal.
Twitter spent nearly $630 million on stock-based compensation in 2021.
It had more than 7,500 employees and now, the company is down to about 2,000 workers after Musk laid off thousands in several rounds of layoffs.
Despite Elon Musk's efforts to monetise Twitter, the micro-blogging platform reported a massive 40 per cent drop in revenue and adjusted earnings for December 2022.
Several advertisers "ditched the social-media platform following Elon Musk's takeover", the Wall Street Journal had earlier reported, citing people familiar with the matter.
In an update to investors, Twitter reported a 40 per cent decline (year-over-year) in both revenue and adjusted earnings for December 2022.
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The company recently made a first interest payment to banks that lent $13 billion to help Musk buy Twitter.
Musk had predicted in November that Twitter may go bankrupt.