Hacker News Reader

Comment by thaumaturgy | Hacker News Reader

I'm not defending Elon's behavior here, but speaking more generally: if you're in a place where you need to maintain maximum productivity for a while, because a deadline has slipped for example, meetings can turn into a massive time sink if you don't act like a total nazi during them.

In so many meetings, people just want to hear themselves talk, whether to offer some opinion, reiterate some point, or ask some useless question. If your goal is, "end this meeting as quickly as possible so I can start fixing the things that need fixing", often the other people in the meeting become your careless adversaries.

edit: I regret trying to raise this point in a thread about Elon Musk. :-(

View on HN

You know Elon doesn't actually like turn wrenches and connect wiring harnesses right? Talking on the phone with investors and making sure the company maintains creditworthiness is his actual core job.

Indeed.

It is obvious to anybody looking at the balance sheets of the company that TSLA will need to raise capital soon. Either late 2018 or maybe early 2019. A company with $3 Billion cash that's losing $1-billion per quarter will need more money. That's just the facts.

Musk is going to be either relying upon institutional investors / the stock market in general for another round of equity offerings, or relying upon banks for a loan. In either case, it seems like Musk just bit the hand that feeds his company money.

Another 300,000 reservations at $1000 per is probably not going to happen. There are fewer and fewer ways for TSLA to raise tons of money.

Linear approximations aren't really the best way to do time series predictions.

Better than Elon's exponential approximations: https://twitter.com/elonmusk/status/881757617416056832

I'm not necessarily saying "TSLA Will definitely run out of money in 3-quarters". I'm saying "TSLA is currently, on a linear-approximation track to run out of money in 3-quarters".

Obviously, the Model 3 rampup will improve profitability. But the Model 3 Ramp-up also requires more resources (more humans in the assembly line. More robots in the assembly line. etc. etc.). So that still requires money.

A linear approximation is basically a quick-but-shitty-approximation. Its really easy to calculate and full of flaws, but full of flaws in a way that almost everyone can immediately understand.

Exponential approximations (ie: Musk's approach) might be more realistic... since production lines can exponentially grow to some degree. But if you are off by even a little bit, then you end up being ... oh I dunno... 8-months to 10 months late with your 5000-cars per-week estimate.

Tesla plans on spending a lot less CapEx in the future compared to last quarter, so they won't burn through as much money.

Given that he was so cavalier here that has these noses bent out of shape, and that he was tweeting April fools jokes about being bankrupt, could it be that he is actually pretty confident in Tesla's credit worthiness and that capital raising will not be required? Seems like a pretty dumb bluff otherwise - particularly on April fools.

Yeah, but a conference call with investors is not the kind of meeting you cut short. Maybe a weekly status meeting sure, but your quarterly call with people who if things go south, you'll have to rely on their largess to borrow money from? That's something you treat with care.

Borrow money isn't the right word. They're not creditors, they hold equity. They're the owners Musk is dismissing. The point of these calls is to make sure the executive officers are being held accountable to the owners of the company with thier money Elon is managing on their behalf. It was a PTA meeting and Elon Musk was being a petulant child who doesn't think he should have to do what his parents tell him.

There are plenty of people holding Tesla bonds that are also listening to this conference call intently too.

>meetings can turn into a massive time sink if you don't act like a total nazi during them.

Which would explain Elon ending the conference call. Instead he spent 15-20 minutes taking open-ended questions from a youtuber with a TSLA position of 56 shares.

>If your goal is, "end this meeting as quickly as possible so I can start fixing the things that need fixing"

For Elon the 'things that need fixing' are exactly what the investors he cut off were asking about. If he is so focused on fixing those things he should have been able to give easy answers. The dodge is illustrative of how well he's handling those problems.

As well it seems ridiculous that the CEO of a ~$50B company can't spare an hour or two every quarter to explain his own company. Even Elon Musk isn't that busy.

If those are actually the things he is working on then perhaps there is no answer to give?

How long is your piece of string?

Well this morning it was three metres but then we doubled it and it looks like that was too much so come back tomorrow and we will let you know.

Then perhaps Musk could be honest and state explicitly that there is no answer. Instead, he chose to respond in a fashion that has multiple interpretations:

- There is no answer

- Musk does not know the answer

- Musk does not want to admit he does not know the answer

- Musk does not want the answer to be known

It's the second time in a short while that he shows he does not want to run the company like it is a public company. But he does want access to that capital. Those two don't mesh.

> It's the second time in a short while that he shows he does not want to run the company like it is a public company. But he does want access to that capital.

I think that Matt Levine (bloomberg) might suggest there's more & easier money to be had in the private market, anyway (see Uber, pre-IPO Spotify, etc...).

The problem for Musk, if he also shares that view, is that taking the company private seems (to me) like an impossibility at this point.

> Matt Levine (bloomberg) might suggest there's more & easier money to be had in the private market

That hypothesis is, at least so far, not sustained by the evidence of private-market darlings continuing to rise in the public markets.

I have no idea why anyone would ever downvote this, it’s a very non controversial statement. Being a public company is a double edged sword, it most definitely has downsides to go with the upsides. Depending on the company/industry/timeline/economy/etc., for some companies the downsides of being public can become a lodestone dragging them down (see Dell).

I think its too early to say Dell has been a posterboy for why going private makes sense, the company was saddled with massive amounts of debt due to the trasition, and are currently struggling to keep above water.

The situation has a lot in common with why leveraged buyouts almost always end in disaster, dispite the hype surrounding them when they are first annouced.

If Musk has a way to keep investors happy without spending time on these calls, he doesn't appear to have deployed it yet. If he doesn't think keeping investors happy is necessary or part of his job, well I guess we'll find out.

This is not a very frequent meeting. He is explaining to the public & investors why they should keep backing Tesla, and it happens only once a quarter. It's worth being thoughtful, given the tens of billions of dollars all the non-Elon shareholders have at stake.

He spent 20 minutes answering softball questions from a youtuber instead.

> He spent 20 minutes answering softball questions from a youtuber instead.

Not just softballs... questions that have nothing to do with Tesla today or the near future... rather... questions about Elon's whimsical dreams of the far future and how Tesla might possibly play into that.

Questions about fully autonomous electric vehicle taxi fleets, etc... but he skipped all the questions about how he's going to get Tesla there or how to survive long enough to see that future.

see that you are not defending, but this is not a meeting. it is an investor conference call - most if not all of the entire point is to clearly and openly answer their questions about financials...

Yeah, it’s not like a weekly status update meeting. It’s a tad unprofessional IMO. As the CEO of a public company, you are accountable above all to your shareholders.

Are these shareholders he’s talking to, or investment bank analysts trying to get the CEO to fill in their spreadsheets for them? I guess I’d be a bad CEO but I don’t get why an “investor” call should be about the company showing respect, bowing down and kissing Wall Street’s ring.

There is a difference between asking straightforward financial questions from his shareholders with grace and tact and "bowing down and kissing Wall Street’s ring"

Yes his shareholders, you know the people that were specificly invited to this call, own the company and that he has to directly answer to, by law.

Instead musk decided to childishly deflect.

On this specific point, he refused to answer two questions from (Wall St) analysts, and instead got questions from a (retail) shareholder. That would seem to be the right priority, even though his attitude was wrong.

There's nothing to "defend". These articles are entirely misleading and absurd. What he said wasn't even noteworthy.

Reply on news.ycombinator.com