9 ms·

> Project Titan is a huge gamble. Titan is not a gamble. It's a hobby. And from the eyes of a Trillion Dollar Company, it's not even an expensive one. What's

> Project Titan is a huge gamble. Titan is not a gamble. It's a hobby. And from the eyes of a Trillion Dollar Company, it's not even an expensive one. What's the worst that can happen? They spend a few more years on it, poaching talent from Tesla and other car companies and from internal teams, and end up with nothing. Sure, they might spend a few billion in the process, but they already did that building a spaceship, and spending at that level doesn't hurt their books at all. iPhone on the other hand, was a huge gamble at the time. It had the potential to ruin the company by cannibalizing iPod sales, diluting the brand, and destroying morale of top engineers who were at the time the "best" employees they had. What's the best thing that can happen? They launch the equivalent of an iPhone in the auto industry, figure out how to scale, and change the way people go from point a to b. They are recognized as the company that pulled off something Tesla couldn't, and Tim Cook / Jony Ives get to put their names on a revolutionary product that changed the world again. So it's a low risk high return situation for them to work on it. Can they pull it off? I would say much more likely than "traditional" auto companies but less likely than Tesla. But again, it doesn't really matter to them (part of why chances of success are lower), and competition is a good thing. As a shareholder of TSLA, I don't want to see Elon Musk smoking weed on YouTube anymore. Somebody please take away his Twitter account too.

AnthonyMouse 8y ago
> Titan is not a gamble. It's a hobby. And from the eyes of a Trillion Dollar Company, it's not even an expensive one. Gambling billions of dollars is gambling billions of dollars even when you have a trillion. And everything is tiny compared to their capitalization. They could buy General Motors and burn it to the ground for ~4% of their market cap. That doesn't make it a good idea. The question isn't what percent of their company size it is, it's whether it's a cost effective use of shareholder money. And best case vs. worst case doesn't tell you anything until you consider the probability of each.
- takahisah 8y ago
  To me, a business decision is always based on _relative_ risk to reward ratio. If you're a startup hiring employee number 3 vs Google hiring employee number 739813, your risk profile is completely different, but the absolute dollar investment in one employee is about the same. In that scenario hiring an employee number 3 could be a huge gamble in a way that hiring employee number 739813 could never be. But lets leave out the technicalities. Call it a gamble, stupid investment, whatever. Yes, I agree a billion is a lot of money. Apple still needs to have this project, in order to stay relevant to competitors and current/potential employees. Even if it does fail, the side effects of having this project mainly to attract talented engineers and stay relevant make it worth the investment.
  - AnthonyMouse 8y ago
    > To me, a business decision is always based on _relative_ risk to reward ratio. If you're a startup hiring employee number 3 vs Google hiring employee number 739813, your risk profile is completely different, but the absolute dollar investment in one employee is about the same. In that scenario hiring an employee number 3 could be a huge gamble in a way that hiring employee number 739813 could never be. Sure, but that's mostly because a startup has a very high risk profile, because success or failure is existential. In nearly all other cases, even for smallish companies, the risk is lower, even for employee number 3. If you're a small doctor's office and you hire a crappy receptionist, you'll have a bad time but you'll survive. If your startup hires a bad marketing person and some competitor popularizes their tech before you do, game over. And once we're not talking about existential risk, we're talking about dollar risk. Which doesn't depend that much on who you are. If it costs ten billion dollars to have a 10% chance to make fifty billion dollars, is it worth it? > Apple still needs to have this project, in order to stay relevant to competitors and current/potential employees. Even if it does fail, the side effects of having this project mainly to attract talented engineers and stay relevant make it worth the investment. But it's a secret. How is it helping them attract anyone if nobody knows about it? They may even have something actually interesting but we won't know until they reveal it (or it leaks), and in the meantime it sounds like pretty boring and expensive follow-the-leader behavior. And if it does fail they won't even tell anyone about it.
    - gbear605 8y ago
      One difference is that the amount of starting capital matters. Say someone tells you that you can spend a million dollars for a 1% chance at a trillion dollars. That makes perfect sense for Apple, but I’d question your judgement if you throw your life savings into that gamble. That’s because the value of a marginal dollar is worth a lot less when you already have a lot of money. To see another example, consider the value that Bill Gates gets from having an extra $100,000 (essentially none) versus a homeless person (life changing).
      - AnthonyMouse 8y ago
        > One difference is that the amount of starting capital matters. Well, yes and no. If you're incommunicado in some kind of locked room with a timebombed offer, sure, if you can't afford to lose the money you say no. But if someone actually offered you a 1% chance at a trillion dollars for a million dollars, you take the offer and then immediately sell the company that owns the contract for ten billion dollars and pocket the ten billion dollars. Or sell half of it for five billion dollars and keep the other half.
bsaul 8y ago
elon probably didn't smoke weed because of a lack of competition... probably the opposite actually. the man is in a complete burnout.
randlet 8y ago
> As a shareholder of TSLA, I don't want to see Elon Musk smoking weed on YouTube anymore But the whiskey was ok with you? Should CEO's have to hide their recreational drug (of which alcohol is a subset) use? FWIW I also hold TSLA and want to see them succeed but a puff of weed (that he didn't inhale) is the least of our concerns. That said, we can probably both agree 3 hours of sleep rather than an interview with Joe Rogan probably would have been the smart move.
- hueving 8y ago
  >But the whiskey was ok with you? Should CEO's have to hide their recreational drug (of which alcohol is a subset) use? Yes, given the fact that weed isn't federally legal and the fact that it could compromise SpaceX contracts with the air force it shows a shocking lack of judgment. It looks like he's coming unglued. Until weed is actually legal federally, it's absolutely insane for the face of such a large company to take that risk. Not a moral judgment, just a legal reality.
  - randlet 8y ago
    > it could compromise SpaceX contracts with the air force If that's true, then you have a good point that I hadn't considered. I can't fathom that could ever become a reality, but my "that will never happen" sense has been way off lately.
    - alexforster 8y ago
      The USAF definitely noticed. He technically shouldn't be able to maintain his security clearance after this. It's probably going to amount to nothing, but it's still bad- https://www.theverge.com/2018/9/7/17833208/elon-musk-air-force-pot-smoking-investigation https://www.theverge.com/2018/9/7/17833208/elon-musk-air-for...
      - whb07 8y ago
        This is fake news. Time to update your sources. If this was an issue for a clearance, then you might as well insta-ban the majority of holders.
Reedx 8y ago
> As a shareholder of TSLA, I don't want to see Elon Musk smoking weed on YouTube anymore. Much ado about nothing. One puff when it was offered to him. So what? He was much more affected by the whiskey, but curiously no one has a problem with that. He even made it clear that he doesn't use weed because he feels it affects his productivity. All you're upset about is a nonsensical stigma. Furthermore, the actual content of the interview was interesting. Stop trying to turn Elon into a yet another fake CEO.
- confiscate 8y ago
  smoking weed is not the problem the problem is, he said he doesn't smoke weed because it decreases productivity, and then smokes weed anyways. Nothing he said makes sense anymore
  - riphay 8y ago
    He took one puff of weed on a casual podcast at ~11 p.m. local time. Not certain this is the canary in the coal mine some people are making it out to be... but I guess volatile stocks will find reasons to be volatile?
    - pm90 8y ago
      The problem is that most of the people who run the economy and the Government are still from a generation that views cannabis consumption as dangerous, anti-establishment drug use not appropriate for people they consider as "proper". This view has been codified into law by Marijuana ban laws, and as I realized just today, into banning it from being used by anyone with a security clearance. As far as we've come with legalizing marijuana and shifting societies perception about cannabis, the vestiges of the old order still exist.
      - riphay 8y ago
        You're absolutely right; but I have a hard time believing this depresses stock valuations with so much smart money out there (by ~20% no less!). Otherwise I think there's a serious market opportunity to be exploited.
asimpletune 8y ago
It’s not even a hobby. If something comes out of it, they’ll completely remake the category. I seriously doubt their end goal is a car in the way we understand them to be.
megablast 8y ago
> It had the potential to ruin the company by cannibalizing iPod sales It would only cannibalize iPod sales if it was a success, and then it isn't a problem at all.

AnthonyMouse 8y ago

> Titan is not a gamble. It's a hobby. And from the eyes of a Trillion Dollar Company, it's not even an expensive one. Gambling billions of dollars is gambling billions of dollars even when you have a trillion. And everything is tiny compared to their capitalization. They could buy General Motors and burn it to the ground for ~4% of their market cap. That doesn't make it a good idea. The question isn't what percent of their company size it is, it's whether it's a cost effective use of shareholder money. And best case vs. worst case doesn't tell you anything until you consider the probability of each.

takahisah 8y ago
To me, a business decision is always based on _relative_ risk to reward ratio. If you're a startup hiring employee number 3 vs Google hiring employee number 739813, your risk profile is completely different, but the absolute dollar investment in one employee is about the same. In that scenario hiring an employee number 3 could be a huge gamble in a way that hiring employee number 739813 could never be. But lets leave out the technicalities. Call it a gamble, stupid investment, whatever. Yes, I agree a billion is a lot of money. Apple still needs to have this project, in order to stay relevant to competitors and current/potential employees. Even if it does fail, the side effects of having this project mainly to attract talented engineers and stay relevant make it worth the investment.
- AnthonyMouse 8y ago
  > To me, a business decision is always based on _relative_ risk to reward ratio. If you're a startup hiring employee number 3 vs Google hiring employee number 739813, your risk profile is completely different, but the absolute dollar investment in one employee is about the same. In that scenario hiring an employee number 3 could be a huge gamble in a way that hiring employee number 739813 could never be. Sure, but that's mostly because a startup has a very high risk profile, because success or failure is existential. In nearly all other cases, even for smallish companies, the risk is lower, even for employee number 3. If you're a small doctor's office and you hire a crappy receptionist, you'll have a bad time but you'll survive. If your startup hires a bad marketing person and some competitor popularizes their tech before you do, game over. And once we're not talking about existential risk, we're talking about dollar risk. Which doesn't depend that much on who you are. If it costs ten billion dollars to have a 10% chance to make fifty billion dollars, is it worth it? > Apple still needs to have this project, in order to stay relevant to competitors and current/potential employees. Even if it does fail, the side effects of having this project mainly to attract talented engineers and stay relevant make it worth the investment. But it's a secret. How is it helping them attract anyone if nobody knows about it? They may even have something actually interesting but we won't know until they reveal it (or it leaks), and in the meantime it sounds like pretty boring and expensive follow-the-leader behavior. And if it does fail they won't even tell anyone about it.
  - gbear605 8y ago
    One difference is that the amount of starting capital matters. Say someone tells you that you can spend a million dollars for a 1% chance at a trillion dollars. That makes perfect sense for Apple, but I’d question your judgement if you throw your life savings into that gamble. That’s because the value of a marginal dollar is worth a lot less when you already have a lot of money. To see another example, consider the value that Bill Gates gets from having an extra $100,000 (essentially none) versus a homeless person (life changing).
    - AnthonyMouse 8y ago
      > One difference is that the amount of starting capital matters. Well, yes and no. If you're incommunicado in some kind of locked room with a timebombed offer, sure, if you can't afford to lose the money you say no. But if someone actually offered you a 1% chance at a trillion dollars for a million dollars, you take the offer and then immediately sell the company that owns the contract for ten billion dollars and pocket the ten billion dollars. Or sell half of it for five billion dollars and keep the other half.

bsaul 8y ago

elon probably didn't smoke weed because of a lack of competition... probably the opposite actually. the man is in a complete burnout.

randlet 8y ago

> As a shareholder of TSLA, I don't want to see Elon Musk smoking weed on YouTube anymore But the whiskey was ok with you? Should CEO's have to hide their recreational drug (of which alcohol is a subset) use? FWIW I also hold TSLA and want to see them succeed but a puff of weed (that he didn't inhale) is the least of our concerns. That said, we can probably both agree 3 hours of sleep rather than an interview with Joe Rogan probably would have been the smart move.

hueving 8y ago
>But the whiskey was ok with you? Should CEO's have to hide their recreational drug (of which alcohol is a subset) use? Yes, given the fact that weed isn't federally legal and the fact that it could compromise SpaceX contracts with the air force it shows a shocking lack of judgment. It looks like he's coming unglued. Until weed is actually legal federally, it's absolutely insane for the face of such a large company to take that risk. Not a moral judgment, just a legal reality.
- randlet 8y ago
  > it could compromise SpaceX contracts with the air force If that's true, then you have a good point that I hadn't considered. I can't fathom that could ever become a reality, but my "that will never happen" sense has been way off lately.
  - alexforster 8y ago
    The USAF definitely noticed. He technically shouldn't be able to maintain his security clearance after this. It's probably going to amount to nothing, but it's still bad- https://www.theverge.com/2018/9/7/17833208/elon-musk-air-force-pot-smoking-investigation https://www.theverge.com/2018/9/7/17833208/elon-musk-air-for...
    - whb07 8y ago
      This is fake news. Time to update your sources. If this was an issue for a clearance, then you might as well insta-ban the majority of holders.

Reedx 8y ago

> As a shareholder of TSLA, I don't want to see Elon Musk smoking weed on YouTube anymore. Much ado about nothing. One puff when it was offered to him. So what? He was much more affected by the whiskey, but curiously no one has a problem with that. He even made it clear that he doesn't use weed because he feels it affects his productivity. All you're upset about is a nonsensical stigma. Furthermore, the actual content of the interview was interesting. Stop trying to turn Elon into a yet another fake CEO.

confiscate 8y ago
smoking weed is not the problem the problem is, he said he doesn't smoke weed because it decreases productivity, and then smokes weed anyways. Nothing he said makes sense anymore
- riphay 8y ago
  He took one puff of weed on a casual podcast at ~11 p.m. local time. Not certain this is the canary in the coal mine some people are making it out to be... but I guess volatile stocks will find reasons to be volatile?
  - pm90 8y ago
    The problem is that most of the people who run the economy and the Government are still from a generation that views cannabis consumption as dangerous, anti-establishment drug use not appropriate for people they consider as "proper". This view has been codified into law by Marijuana ban laws, and as I realized just today, into banning it from being used by anyone with a security clearance. As far as we've come with legalizing marijuana and shifting societies perception about cannabis, the vestiges of the old order still exist.
    - riphay 8y ago
      You're absolutely right; but I have a hard time believing this depresses stock valuations with so much smart money out there (by ~20% no less!). Otherwise I think there's a serious market opportunity to be exploited.

asimpletune 8y ago

It’s not even a hobby. If something comes out of it, they’ll completely remake the category. I seriously doubt their end goal is a car in the way we understand them to be.

megablast 8y ago

> It had the potential to ruin the company by cannibalizing iPod sales It would only cannibalize iPod sales if it was a success, and then it isn't a problem at all.