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Can someone please ELI5 this for me? Why is a private Tesla better? As long as Elon and employees own more than 51% of the stock (do they?), can't they not just

Can someone please ELI5 this for me? Why is a private Tesla better? As long as Elon and employees own more than 51% of the stock (do they?), can't they not just ignore the stock price swings?

belltaco 8y ago
You still have to publicly reveal all the quarterly numbers, estimates for next few quarters, do all the GAAP accounting etc. which puts a lot of toll on a company that's going through wild swings in capital spending and production. If they don't keep their promises, the stock will crash, so everyone goes on a production death march close to the end of the quarter under extreme stress, instead of just growing organically at a steady pace. Good estimates are hard, just like in IT. That's why many companies delay going public, for example Uber.
- eastendguy 8y ago
  Yeah, but why not just ignore a stock price crash if you don't need to sell and believe in the long term plan?
  - Scarblac 8y ago
    Every employee holds stock. I don't think every employee is in the position of never needing to sell. A price crash is bad for morale.
  - deleted 8y ago
    [deleted]
cam3ham 8y ago
read the article?
- eastendguy 8y ago
  You mean the email? "...I fundamentally believe that we are at our best when everyone is focused on executing, when we can remain focused on our long-term mission," => what difference does private or public make for this?
  - laken 8y ago
    I still don't think you've read the full email. He explains elsewhere in the email the answer to your exact question
dorgo 8y ago
> As a public company, we are subject to wild swings in our stock price that can be a major distraction for everyone working at Tesla...
dragonwriter 8y ago
It's better from the company perspective because the truth Tesla as a public firm is required to regularly disclose keeps undermining the puffery Tesla is pushing to generate consumer-focussed media interest. Being private gives them much better control of public information.

Can someone please ELI5 this for me? Why is a private Tesla better? As long as Elon and employees own more than 51% of the stock (do they?), can't they not just ignore the stock price swings?

belltaco 8y ago

You still have to publicly reveal all the quarterly numbers, estimates for next few quarters, do all the GAAP accounting etc. which puts a lot of toll on a company that's going through wild swings in capital spending and production. If they don't keep their promises, the stock will crash, so everyone goes on a production death march close to the end of the quarter under extreme stress, instead of just growing organically at a steady pace. Good estimates are hard, just like in IT. That's why many companies delay going public, for example Uber.

eastendguy 8y ago
Yeah, but why not just ignore a stock price crash if you don't need to sell and believe in the long term plan?
- Scarblac 8y ago
  Every employee holds stock. I don't think every employee is in the position of never needing to sell. A price crash is bad for morale.
- deleted 8y ago
  [deleted]

cam3ham 8y ago

read the article?

eastendguy 8y ago
You mean the email? "...I fundamentally believe that we are at our best when everyone is focused on executing, when we can remain focused on our long-term mission," => what difference does private or public make for this?
- laken 8y ago
  I still don't think you've read the full email. He explains elsewhere in the email the answer to your exact question

dorgo 8y ago

> As a public company, we are subject to wild swings in our stock price that can be a major distraction for everyone working at Tesla...

dragonwriter 8y ago

It's better from the company perspective because the truth Tesla as a public firm is required to regularly disclose keeps undermining the puffery Tesla is pushing to generate consumer-focussed media interest. Being private gives them much better control of public information.