Twelve years ago today, American electric vehicle (EV) manufacturer Tesla secured $40 million in additional financing to help avoid bankruptcy. After the news recounting the event was Tweeted out, Tesla's CEO chimed in and offered some additional texture to a certified do-or-die situation that appears to have affected the trajectory of the company forever.
Tesla was founded in 2003 and included Elon Musk as the fourth employee to join the team as co-founder and chairman of the board. Due to his vision in design of Tesla's first EV, the Roadster, Musk led the design of numerous components and very early on proclaimed the goal of mass producing affordable EVs for all. Musk continued to lead round after round of gathering additional funding for Tesla to develop the Roadster. In 2008, Musk took over as CEO of the company to oversee the official launch of its first EV. While it seemed Tesla was finally on track (literally), things were actually rather dire behind closed doors.
In a Tweet, Bloomberg anchor Jon Erlichman noted how today marks the anniversary of Tesla receiving a commitment of an additional $40 million from investors to help it out of financial trouble, after losing in arbitration in regard to a lawsuit against fellow EV manufacturer Fisker. A year before that, Tesla had entered into a contract with Fisker to help design its then-unnamed Model S sedan, unaware that Fisker had recently entered into contract with another company to create a similar all-electric vehicle. This led to the lawsuit which ultimately ruled in favor of Fisker, and could have spelled the end for Tesla had it not received the additional funding at the time. That being said, the commitment to the additional $40 million was one win, but actually getting everything squared away legally and financially was an even more difficult task.
Earlier today, Elon Musk surprisingly (or not) replied to Erlichman's Tweet and offered to share more of the story, relaying that Tesla was three days away from bankruptcy at one point. While the commitment was made on November 3, 2008, the actual funding was not so easy to physically obtain from investors, at a time when other American automakers were going bankrupt. Musk revealed that the funding round was not completed until 6PM on Christmas Eve, the last possible day before everyone went off for the holidays.
What was most interesting is how Musk himself helped get the funding over the finish line with his own money, after explaining that he put every penny he had into the funding round to avoid bankruptcy. Musk added that he even had to borrow money from friends just to pay his rent at the time. Whether consumers recognize this bold decision or not, it was certainly a pivotal moment for the Tesla brand and its future, and the rest is history. That following May, Tesla received an additional $50 million in funding and has been innovating ever since. As of this year, Tesla sits as the most valuable automaker in the world, by market value.
Source: Jon Erlichman/Twitter
from ScreenRant - Feed https://ift.tt/3l7VRbu
0 Comments