An Update from Elon Musk

In startup environments crunch time has a nasty tendency of becoming normal time, and you get nosediving morale, massively increased attrition, and lower overall productivity. It's lose-lose all around.

So sure, in a startup you'd expect some late nights. When late nights become the norm though, you are now officially in dysfunctional company territory - don't let naive founders with rainbows and unicorns in their eyes convince you otherwise. Very sick of this Valley attitude that you must push yourself to the very edge of death-by-exhaustion to achieve anything worthwhile.

Many of us here are founders and we're in business to challenge status quo and possibly make a dent in the universe. That takes hard work from founders AND contributors.

If anyone thinks things should be different in startup business, they should take a step back and really evaluate how much hard work really goes into achieving these goals.

After that if they can't see no compelling reason to do it, they should just get a job in a more traditional business. I don't blame people for taking that route. This business isn't for anyone.

http://www.glassdoor.com/Reviews/Tesla-Motors-Reviews-E43129...

Tough to say what the stories were behind all of these, but I can see how they might feel the need to push people way harder than normal, because during yesterday's presidential debate Romney lumped Tesla in with a list of losers that the government has given money to. Plenty of people are expecting them to fail even though many of us are excited at their prospects. In such an environment, I can see how Elon Musk might push some workers beyond what they can handle. However, I'd expect many of them are still happy to be part of the team even though the work is hard, because a Tesla employee really is part of something more world-changing than an Electronic Arts coder is.

Yeah, there's some dodgy stuff, a lot of information about these cars, such as the reality about their batteries and how much energy they really use to go from A to B over time has high spin when I start looking into details. Was genuinely surprised.

Thanks for the details about what the financing is really about, that's very interesting info.

"We did suggest that holding nine months worth of principal payments in advance in a reserved account was a bit extreme and, moreover, was never part of our original loan agreement. The DOE agreed and reduced the advance payment reserve account to six months."

You saying

"keep certain financial ratios up to certain levels, and tesla failed to do that. As a result, tesla asked the government to change the terms"

...doesn't seem to add to or contradict his statements.

So unless you can clarify, your statement that "that is the full story ... elon was definitely not giving you all relevant info." seems inaccurate.

This seems very straight-forward.

Having to justify a 500m loan to a pioneering technology company in one of the biggest recessions? That's a rounding error compared to the billions spent on rescuing failed banks or in researching fancy new ways to blow stuff up.

(Sorry, I, too, am frustrated.)

Otherwise, they would probably raise money later for a specific project requiring lots of capital (like a new vehicle, as mentioned).

How do you jump from "we're almost cash-flow positive" to "we're flush with cash"?

And isn't Tesla's situation a little too tenuous for them to be feeling sorry for diluting their shareholders? Making viable electric cars is their priority - not making their investors rich ASAP.

$ whoami > nobody

I'm sure his time will come (already starting to). He's built and talked, but other than Paypal the world hasn't yet in a huge way reaped the benefits of his labor. With Tesla and SpaceX both (somewhat recently/soon) reaching a point of having products in heavy use, it'll come soon I'm sure.

Though maybe he should have some reward for attempting to tackle the big problems as well.

If that's truly your belief, let's carry it out across the board to be fair and complete. No more subsidies, exemptions or bailouts for banks, Wall Street, oil companies, mining companies or religions (via income tax exemptions). Oh that's right. Those are approved and supported by the Republican party. So those are perfectly ok.

But if it is about say solar, wind, tidal, or geothermal energy, or about science, education, helping the unemployed, the sick, disabled, elderly, retired -- those are what we should be spending less on as taxpayers and just let nature take its course. Let the "market" decide the winners and losers. If they can hack it on their own, the market will reward them with enough cash. Otherwise they die. There is absolutely no other long term consideration we should be taking into account, no strategic concerns, no follow-on effects, no externalities (those don't exist in a proper capitalist/rightwing/libertarian mindset, it seems), and certainly no moral considerations to be had. And there is no such thing as climate, ecosystems, or species other than humanity or the ones we pet or put on our plates -- that's liberal hippy talk. Science? A thinly-veiled conspiracy against my Bible. Also there's no need for any business or startup to ever do any R&D spending up front that doesn't have an immediate return via product revenue. That's just insane and asking for trouble. Any new idea must be profitable and able to stand on its own legs in year one, on day one -- nay literally within moments of conceiving of it. Period. No exceptions for ramp-up time, for execution risks, experimentation, taste shifts, refinement, pivoting, serendipity, or market events beyond one's control. That's all weak-minded liberal talk.

$500M loan to one particular solar company that folds? Travesty. Trillions spent on unnecessary wars in Iraq and Afghanistan started by the last Republican administration? Crickets chirping because apparently perfectly ok. Chance a few more blacks or elderly or college students might get to vote -- and not for the candidate I want? Tragedy. Billionaires now being able to spend effectively unlimited amounts of cash to flood media with dishonest ads backing their favored candidate? Perfectly ok. Because the market is always right. Government always eeeevil (eg. Social Security, teachers, firefighters, roads, libraries, schools, defense). Market always guuud (eg. Enron, Deepwater, Goldman Sachs, AIG).

The Tesla Roadster was heavier than the Lotus car it was based on, but had quite respectable performance. That fact, combined with the electric car cachet was enough to sell it.

If they can keep putting the batteries in the floor, they could consistently wind up with a roomier and more versatile vehicle than the equivalent ICE car. Then again, what Ford is doing with Ecoboost is very impressive. I suspect there's a lot of untapped potential for different form factors with ICE technology.

Specifically their range - you must appease consumer's range anxiety otherwise you have a golf cart on your hands. Tesla does this.

Furthermore have you seen those cars? They are essentially undifferentiated from their ICE counterparts.

Right or wrong as a matter of managing your finances this is just not something a competent CFO would allow on his watch.

You accepted a loan, the loan originator had some terms and you are both in compliance and acceptance of those terms.

There is no rational or financial reason to make that choice.

I understand doing good, but there is a consistency in the choices firms which do good make. This is inconsistent.

"Cash flow insolvency involves a lack of liquidity to pay debts as they fall due. Balance sheet insolvency involves having negative net assets—where liabilities exceed assets. Insolvency is not a synonym for bankruptcy."