Elon Musk leaned on Tesla Inc.’s board to arrange another massive stock award for him years after he sold a significant chunk of his shares in the company to acquire Twitter.
In one of several posts on the topic, Musk wrote that unless he has roughly 25% voting control at Tesla, he’d prefer to build artificial intelligence and robotics products elsewhere. While he remains the carmaker’s biggest shareholder with an almost 13% stake, he sold almost $40 billion worth of stock in 2022 to help fund his Twitter purchase.
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Hmmm.
William Blake had it right about the Musk’s mentality long ago, at the dawn of our industrial technical age:
“…If the many become the same as the few when possess’d, More! More! is the cry of a mistaken soul. Less than All cannot satisfy…”
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So Elon needs a bigger stake in Tesla to build those products. He NEEDS more stock to provide the additional motivation. Of course the reason he “only” has 13% in Tesla is due to his vanity purchase of Twitter.
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Oh but isn’t mindset and approach so much more sophisticated compared to say an impulsive, spoilt teenager?
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Counting existing options, it is more like 22%, although he likely to have to sell some of that when it vests in order to pay taxes.
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LOL. Most teenagers are still to egotistically “small” to demand the massive “more” that still falls far far short of the logically necessary demand for “all”.
But Musk the eternal teenager has a special gift.
d fb
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Since Musk is getting ZERO salary it makes sense that he wants more than ZERO. Or is he supposed to keep working at ZERO salary?
The Captain
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Musk is the most complex industrialist of all time. He has huge financial needs. X might not be a mistake in the long run. Robots are necessary to compete in all industries with China and Europe. AI will sink a lot of boats when misused but so far the legal system is allowing a lot of room in the sandbox to mess around. Meanwhile the larger projects Musk has been creating for AI make sense.
Christ on a stick.
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It be interesting if the board concluded that the best course of action would be to not give the award to Elon, and develop AI without him.
How much time is he spending on Tesla anyway? He’s got SpaceX, Twitter, Boring, Neuolink, and whatever else. Is he the guy you need to develop AI within Tesla while running the whole company at the same time?
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Elon job is to drive Shareholder Value to the moon & thus be rewarded that way. And with all of his other businesses; just how much time is he spending on Tesla anyway?
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I don’t think Musk is saying this exactly. I think he is saying - “I started an auto company, with very long odds, and I made it work, and you paid me well because I made it work”, and he is further saying “I also want to start an AI company and a robot company and I would also like to be paid well for that if I can make it work”.
I think this is the essence of what he is saying. And he is implying that if the AI company and the robot company are to be inside Tesla, then Tesla needs to pay him, otherwise he can start those new businesses outside Tesla and get paid by the eventual owners of those companies instead.
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Has nothing to do with his efforts. It has to do with him financing all of those mostly interwoven projects. His time is the most valuable on earth right now.
The money comes from the investors. People he inspired.
Must add, I will never buy a Tesla. His bigotry has turned me completely around on him.
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Is it possible Elon is feeling poor?
Elon began buying Twitter stock in late January 2022. TSLA was ~$383 a share. Elon did attempt to weasel out the deal the summer of 2022. But the court said nay nay Elon you must go through with the deal. The deal closed on October 28, 2022. TSLA was valued at ~$255 a share. Currently TSLA is valued at ~$219 a share.
If the Tesla board caves Musk Tesla stock wealth doubles and returns similar to what he had in 2022.
It seems Musk appears to be peeved he is working for nothing.
“I am uncomfortable growing Tesla to be a leader in AI & robotics without having ~25% voting control. Enough to be influential, but not so much that I can’t be overturned,” Musk said from his X account on Monday night. “Unless that is the case, I would prefer to build products outside of Tesla.”
Musk went on to say that large asset custodians such as Fidelity and BlackRock own stakes in Tesla similar to his and asked: “Why don’t they show up for work?”
Those b*stards at Fidelity & Blackrock are benefiting from Elon’s sweat They just had to only invest in Tesla. Yeah but for many years Tesla was not profitable and so they were taking a risk which Musk now begrudges them now that Tesla is profitable.
So double my stake or you don’t get my AI & robotic ideas.
I have a question about that. Musk while he is the CEO; he is an employee of Tesla. Aren’t those ideas already owned by the Tesla corporation? Aren’t inventions by engineers at a corporation owned by the corporation. Or a new drug developed by employee doctor owned by the pharmaceutical corporation?
And likely Musk is peeved that the value of Twitter has declined since his ownership that cost him the sale of mucho Tesla stock to buy that company.
Musk used to have a much larger stake in Tesla but he sold a large quantity of Tesla stock to fund his widely criticized purchase of Twitter — now X — in 2022, diluting his Tesla stake to 13% from around 22%.
And to toss another fly into the ointment. Musk’s current compenstiion is being litigated.
The shareholder’s lawyers argue that the compensation package should be voided because it was dictated by Musk and the product of sham negotiations with directors who were not independent of him. They also say it was approved by shareholders who were given misleading and incomplete disclosures in a proxy statement.
Delaware courts often defer to the “business judgment” of corporate directors in decision-making absent a showing of wrongdoing. But attorney Greg Varallo argued that the Tesla defendants should be required to show that the compensation plan was “entirely fair” to stockholders because Musk was a controlling shareholder.
I do not believe the Tesla board wants to give Elon a 25% stake until this current lawsuit is settled.
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The “institutions” are not taking it lying down.
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Is he paid a salary? How much would you pay him? If in stock options, investors might be very pleased. Better to preserve the cash.
Stock awards are a good deal for his creative talents. They are too rare.
He is not interested in rewards or pay.
He is interested in ownership stakes for his financial planning.
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It might be cheaper to pay Musk a $50 MM/yr salary than further dilute the shareholders with another enormous stock gift.
Maybe it’s workable if the stock grant vests when Tesla’s market cap crosses $5 Trillion.
intercst
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That’s exactly what he’s saying. Here’s what the board should be saying/asking to themselves: Elon wants about $70 billion in stock in order to do his AI at Tesla. That’s a lotta dough. Elon is running about 15 companies and he’s high on ketamine. Maybe there is another guy who can get the AI done cheaper, and dare I say it, better?
And can Elon do it outside of Tesla? Probably, but it would be risky. AI is the hot thing and there is a global arms race to get there first. What if Elon’s self-driving AI is just slightly worse than Google’s? And how much of Elon’s knowledge of AI is patented or NDA’d by Tesla?
Maybe Elon doesn’t have as much leverage as he thinks.
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Shareholders who work at a company should not be paid because they have shares?
The Captain
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Elon only wants to be paid in shares. You can’t complain he’s getting zero salary if he wants his compensation in stock.
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