Today, it's no secret that Elon Musk is a rock star CEO and Tesla is a dazzling success story. Institutional Investor reminds us that, "It is the first automaker to go public since Ford in 1956... [and] the stock has soared more than 1,300 percent since Tesla went public in 2010." But, looking back at the origins of Tesla, it wasn't all smooth-sailing. In fact, according to Visual Capitalist, "even Elon Musk would tell you that it wasn’t always obvious that the company would be around in 2017."
Above: The original Tesla Roadster (Image: Inhabitat)
Nevertheless, early investors have reaped impressive returns — Tesla [NASDAQ: TSLA] now trades, albeit with great volatility, north of $300 per share. Looking back, "Priced at $17 per share just seven years ago, the Tesla IPO ended up being a total bargain for anyone lucky enough to get in."
So what happened at the genesis of the company to set the stage for such unbridled growth? At its inception, "Tesla was initially conceived in 2003 out of the vision of two Silicon Valley engineers, Martin Eberhard and Marc Tarpenning. The partners had just sold their eReader company for $187 million, and were looking for their next big idea. The infamous 'death' of GM’s EV1 electric car that year ended up being a source of inspiration, and the two engineers started looking into ways to reduce the world’s reliance on Middle Eastern oil and to combat climate change."
Enter Elon Musk. It turns out, "The company was bootstrapped until Elon Musk led the $7.5 million Series A round in February 2004 and became the controlling investor. He joined the board of directors as its chairman, and took on operational roles as well. At this time, JB Straubel – who famously rebuilt an electric golf cart when he was only 14 years old – also joined the company as CTO."
Above: Elon Musk takes over as CEO in 2008 (Instagram: david_sacco_)
While trying to launch Tesla's Roadster, top management experienced some dramatic changes — especially at the top. In 2007, Eberhart was forced to resign as CEO. Later that year, early investor Michael Marks took the reins temporarily until Ze’ev Drori took over. But, after less than a year of Drori’s run at the top, Musk stepped in to take over the role of CEO in October 2008. Musk had said, "I’ve got so many chips on the table with Tesla. It just made sense for me to have both hands on the wheel."
Musk made sweeping changes across the company to get things back on track. And, "Despite revamping the entire production process – and the company itself – Tesla made it through its most trying time. The Roadster wasn’t perfect, but it helped Tesla learn what it meant to be a car company... [and] with the Roadster, Tesla would not only set itself up for future success, but also the transformation of an entire industry."
For a deep dive into the origins of Tesla, check out this comprehensive infographic* — sorta stylized like a cool, superhero comic — in order to get the scoop on what really went down...
Note: Article originally published on evannex.com, by Matt Pressman
*Infographic: Visual Capitalist via Global Energy Metals