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A counter argument is that tesla is a conventional business that is packaged by Elon musks masterful salesmanship as a one of a kind company where normal rules

A counter argument is that tesla is a conventional business that is packaged by Elon musks masterful salesmanship as a one of a kind company where normal rules don't apply. At my old company Martin shkreli pitched to us a few times, and Elon uses some similar reality distortion tricks to excite investors. For tesla, that is necessary, because no rational investor would invest in an electric car startup. But if you can get investors excited enough about some vague but very promising future, they will overlook short term failures and be guided less by fact than belief

lmilcin 9y ago
I guess this "conventional" thinking was due to the fact that electric car startups had bad history of not delivering. Tesla excites investors because they have history of not only delivering but also exceeding expectations. I think as long as they keep delivering on those expectations, they will be immune to conventional valuation methods.
- dragontamer 9y ago
  > exceeding expectations How many Model 3 cars were supposed to be delivered by now? 5000 per month? Or something? The company, instead of working out its issues with the Model 3, hype up the Tesla Semi and Tesla Roadster, in hopes that people forget about its Model 3 issues. This is a company that's tilting way more in the "hopes and dreams" category than any actual, physical deliveries.
  - aaavl2821 9y ago
    Agreed, and this is where it can get messy. Distracting investors from bad news to buy your company more time to accomplish hard goals is one thing, and a necessary evil that many companies (big and small) face from time to time. But when this practice becomes a regular thing because execution continues to fall short of promises, you fall down a slippery slope where perception matters more than reality this is a large part of what happened with theranos
- d4rti 9y ago
  > Tesla excites investors because they have history of not only delivering but also exceeding expectations. I think as long as they keep delivering on those expectations, they will be immune to conventional valuation methods. Certainly not on their production numbers versus promises from Elon.

lmilcin 9y ago

I guess this "conventional" thinking was due to the fact that electric car startups had bad history of not delivering. Tesla excites investors because they have history of not only delivering but also exceeding expectations. I think as long as they keep delivering on those expectations, they will be immune to conventional valuation methods.

dragontamer 9y ago
> exceeding expectations How many Model 3 cars were supposed to be delivered by now? 5000 per month? Or something? The company, instead of working out its issues with the Model 3, hype up the Tesla Semi and Tesla Roadster, in hopes that people forget about its Model 3 issues. This is a company that's tilting way more in the "hopes and dreams" category than any actual, physical deliveries.
- aaavl2821 9y ago
  Agreed, and this is where it can get messy. Distracting investors from bad news to buy your company more time to accomplish hard goals is one thing, and a necessary evil that many companies (big and small) face from time to time. But when this practice becomes a regular thing because execution continues to fall short of promises, you fall down a slippery slope where perception matters more than reality this is a large part of what happened with theranos
d4rti 9y ago
> Tesla excites investors because they have history of not only delivering but also exceeding expectations. I think as long as they keep delivering on those expectations, they will be immune to conventional valuation methods. Certainly not on their production numbers versus promises from Elon.