TSLA Market Action: 2018 Investor Roundtable

[KarenRei]

When has he been over optimistic about potential investors to take his company private? That’s rhetorical.

Wait, so he's supposed to be overoptimistic in general, excepting in this specific case that he's never done before? Elon is supposed to suddenly become a different person when dealing with privatization?

Don’t conflate his optimism about impossible vehicle launch timelines and AP abilities and such with what’s happening now. Totally different.

Not "totally different". He's the same person. Do you think he's been deliberately overoptimistic about... well, virtually everything else? No. He's just an extremely optimistic person. It's his nature. Which is good - he never would have taken all these risks that's created these amazing companies if he wasn't that optimistic. But his optimism isn't going to suddenly take a rain check just because privatization is important. He's been optimistic about literally everything important about his companies thusfar.

 

[Thumper]

Well, I'm finally caught up because.. life. Went for a walk last Tues morning and came back to find everything changed. Put a buy order in while TSLA trading was suspended and got another 57 shares at $370. Assumed price would shoot to $420ish. After reading all of the posts, it looks to me like Elon hadn't quite convinced the full board to go along so he is forcing their hand. I'll certainly stay with Tesla if I can. Question for accredited ownership, is it $1M net worth AND $300K joint income, or is it $1M net worth OR $300K joint income?

 

[neroden]

Well, I'm finally caught up because.. life. Went for a walk last Tues morning and came back to find everything changed. Put a buy order in while TSLA trading was suspended and got another 57 shares at $370. Assumed price would shoot to $420ish. After reading all of the posts, it looks to me like Elon hadn't quite convinced the full board to go along so he is forcing their hand. I'll certainly stay with Tesla if I can. Question for accredited ownership, is it $1M net worth AND $300K joint income, or is it $1M net worth OR $300K joint income?

It's "OR". House doesn't count towards net worth.

 

[Thumper]

I want to thank all the contributors here who have so generously helped educate me about TSLA in particular and investing in general. If we end up private, I assume I will spend less time on these boards. Maybe I'll read books again.

 

[dw4ngg]

Fak I need a short squeeze to become an accredited investor...... come on $1,000!!!

 

[Krugerrand]

Wait, so he's supposed to be overoptimistic in general, excepting in this specific case that he's never done before? Elon is supposed to suddenly become a different person when dealing with privatization?

Here’s a fact, people aren’t black and white. If you pay close enough attention you’ll see the complexity of their nature, even the contradiction of it. And most definitely the grey of it.

He NEVER gets over optimistic about the survival and health of his companies. EVER. He’s always got a backup plan incase things go south. He had a buyer for Tesla back in 2013. He had money for a sixth rocket launch even though he’d told everyone #5 was their last kick at the can. He got money for all his previous companies as well, and in some of the most creative ways. This isn’t his first time getting money against odds.

Don’t believe me. Wait, watch and see. He’s got this.

Not "totally different". He's the same person. Do you think he's been deliberately overoptimistic about... well, virtually everything else? No. He's just an extremely optimistic person. It's his nature. Which is good - he never would have taken all these risks that's created these amazing companies if he wasn't that optimistic. But his optimism isn't going to suddenly take a rain check just because privatization is important. He's been optimistic about literally everything important about his companies thusfar.

Yes, it is totally different. Motivation for starters is completely different when he announces his product timelines. Circumstances completely different.

You’re wrong about him and also wrong about people in general if you judge them as you judge him.

 

[Intl Professor]

Then again they plant them at every corner, california is full of suggestions

That's why we are so innovative. Look at the financial state of CA compared to, say, Kansas.

 

[KarenRei]

Here’s a fact, people aren’t black and white. If you pay close enough attention you’ll see the complexity of their nature, even the contradiction of it. And most definitely the grey of it.

He NEVER gets over optimistic about the survival and health of his companies

He literally mortgaged all his assets to keep Tesla and SpaceX afloat at one point when they were failing. If that's not optimism, I don't know what is. He got to that point in large part because he was overoptimistic about how well his companies would do, and was bitten harshly when they had problems.

You're confusing "optimism" with "not having a plan". He always has plans. He's almost always overoptimistic about how well they'll work. He adjusts with time, and generally gets there in the end, usually after false starts.

I have no doubt whatsoever that he has investors lined up. I'm not going to discuss this further, since we're going in circles, but I'm just going to point out, Musk's confidence in something being a "sure thing" has time and time again been shown to be way more complicated than he expected. Expressions of interest is not the same thing as a carefully negotiated buyout deal, which can get very complicated, very quickly.

 

[ggr]

I should be clear: I'm speculating. Because there's a lot of evidence that they're trying to find more investors, but Musk already has funding lined up -- which means that he probably has it lined up from *fewer distinct investors than he would like*.

I would change the word "he" to "they", as in the Tesla BoD. If Elon had commitment from Larry Page and Warren Buffet I think he would be happy with two. (Nobody mentions Buffet as a possibility. I think it's at least a possibility. Tesla fits his profile except for one thing, which is that it's a new technology company.)

 

[mongo]

If future buyer thinks that 420 is a bargain, why didn’t he allready buy with 355 with or without the buyout plan.

I did, and likely they are. If they go above 5%, we'll know within 10 days. The buyout is to compensate those not wanting or not able to go with TSLAP with a mild premium.

@neroden 's original post (9 pages ago) was not contrary to this concept (as far as I can tell)

OK, this is pretty clear. Musk has lined up funding to go private, but it's from one or two large investors (maybe three or four). He and the Board don't like having that level of concentrated ownership -- more concentrated than Musk perhaps -- so they're trying to get a larger conglomerate so as to split up the control.

Makes perfect sense. Implies that the one or two who have agreed to provide funding are *not* demanding control (which makes sense to me -- they still get big, chunky stakes of Tesla and the company is free of a source of badmouthing).

 

[Matias]

I would change the word "he" to "they", as in the Tesla BoD. If Elon had commitment from Larry Page and Warren Buffet I think he would be happy with two. (Nobody mentions Buffet as a possibility. I think it's at least a possibility. Tesla fits his profile except for one thing, which is that it's a new technology company.)

To my understanding, Buffet only buys established companies. I remember that he has said, that he is not interested about “turnaround” companies.

 

[Krugerrand]

He literally mortgaged all his assets to keep Tesla and SpaceX afloat at one point when they were failing. If that's not optimism, I don't know what is. He got to that point in large part because he was overoptimistic about how well his companies would do, and was bitten harshly when they had problems.

No, you’re wrong.

It was NOT optimism that made him do that. He EXPECTED both Tesla and SpaceX to fail. Why he did them was because he felt it was important to humanity. The reason why he poured every cent into them in 2008 is because he NEVER gives up. EVER.

You don’t know the man at all.

 

[Unknown_Wizard]

I would change the word "he" to "they", as in the Tesla BoD. If Elon had commitment from Larry Page and Warren Buffet I think he would be happy with two. (Nobody mentions Buffet as a possibility. I think it's at least a possibility. Tesla fits his profile except for one thing, which is that it's a new technology company.)

Didn't Musk mention Warren Buffet in some of his tweets a few month ago, did he? If I do remember right, the tweets were about moats or something...

Buffet is already invested in chinese BYD...

 

[Big Earl]

Tesla's Elon Musk faces investor lawsuit

Please make complaint to BBC because they mislead readers with title suggesting that Tesla investor made a lawsuit against Tesla. That is corrected inside article that in fact short sellers made a lawsuit.

The title and lead to article is what 90% readers only see because of content agregators.

Complaint form:
BBC - Complaints - Home

Done. Thanks for the link.

 

[CorneliusXX]

I would change the word "he" to "they", as in the Tesla BoD. If Elon had commitment from Larry Page and Warren Buffet I think he would be happy with two. (Nobody mentions Buffet as a possibility. I think it's at least a possibility. Tesla fits his profile except for one thing, which is that it's a new technology company.)

I don't think buffet buys companies that are not already highly profitable. However he does have a lot of money to spend at the moment and has two new investment managers lined up for when he retires who have shown to invest in areas that i would have considered outside Buffet's scope (e.g. Apple).

That said, Buffet does have a history of buying companies that have a strong founder who want to continue their growth without their current capital constraints. He has also invested in BYD so he should know the industry well.

There would also be concerns around the power structure of risk taking Elon and relatively conservative Buffet. I don't know if Buffet would be willing to give Elon the level of freedom that Elon would want.

My guess is <25% chance Buffet is one of the backers.

 

[Intl Professor]

I have no doubt whatsoever that he has investors lined up. I'm not going to discuss this further, since we're going in circles, but I'm just going to point out, Musk's confidence in something being a "sure thing" has time and time again been shown to be way more complicated than he expected. Expressions of interest is not the same thing as a carefully negotiated buyout deal, which can get very complicated, very quickly.

It's already complicated, he's aware, and working on it—the problem of conversion. Source of funds a non-problem, so let's all drop it before GGR steps in.

 

[Unknown_Wizard]

Here it is..

 

[JRP3]

I'm also not a huge fan of Elon's sometimes "matter of fact" statements about things that are just targets (there have been a number of them, of course, including the infamous "back seats will fold flat" of the Model X)

But they do, now. He never said "when" they would fold flat

 

[Intl Professor]

To my understanding, Buffet only buys established companies. I remember that he has said, that he is not interested about “turnaround” companies.

Q3 results will "establish" Tesla, if not already. With a market cap near or exceeding GM's, what do you need?

 

[Moderatefan]

Wtf looks like Musk's twitter is hijacked by Grimes, I hope she doesn't start posting on the details of the private deal, this could turn sour pretty quickly.