If I were a venture capitalist today, I’d just be shaking my head at the Tesla Motors IPO. No profits, declining quarter-over-quarter revenue, a bankrupt founder/CEO, proven manufacturing difficulties and all hopes resting on a $50k sedan that won’t begin production until 2012.
“Don’t we have unsuccessful companies like that in our portfolio,” I’d ask. “We even have some government loans for our cleantech companies. Is all we’re missing a better marketing department?”
I might also wonder why Elon Musk is doing television interviews about the company, whereas other CEOs clam up due to post-IPO “quiet periods.”
But not everyone agrees with me, as evidenced by the fact that Tesla is trading above its IPO price despite a dismal day on the broader market. Reader Jim sent over the following thoughts via email:
This is the classic “against all odds i’ll get it done even though the naysayers don’t think i can” start-up. Remember, they are not all “straight line up” like Groupon or Twitter or Facebook.
I’m friends w/ a few folks that are good friends w/ Elon and he’s the classic big picture, long-term thinker. I know there are a ton of hacks out there man, but trust me, this guy is not one of them. He is the real deal. He operates at a level that is way beyond the rest of us. The cover of time this week is Thomas Edison. I’m not saying Elon is the next Edison, but I am saying he’s a lot closer to Edison than he is you or me.
Re Tesla: Hhis thinking is the current car companies (sans maybe toyota and 1 or 2 others) are totally broken. They just can’t make it work. Also, fossil fuels are broken. So, his view is that technology (i.e. just like Edison) solves everything. It might take him 10 years to get there but don’t be surprised if 10-20 years from now Tesla is still around and thriving. It will take a lot of time and patience. Unlike most of us, Elon has the patience (and balls) to wait it out.
That doesn’t mean the stock is worth anything today — and I won’t buy it — but, despite his personal challenges, I find the guy inspiring and i’ll be rooting for him from the sidelines.