5 ms·

This so incredibly wrong and un-informed its mind blowing. SpaceX has been profitable from pretty early on in its history and were until they need massive cash

by nickik 5y ago

This so incredibly wrong and un-informed its mind blowing. SpaceX has been profitable from pretty early on in its history and were until they need massive cash for the Starlink project. Tesla is a attempting to get into a very, very capital intensive industry and during the early growth and again in 2017 they had to be less un-profitable. But the companies consistently showed that if it stopped growing it could be profitable. The idea that it literally all there is to it is insane. Pretty much every startup is willing to make loses for growth, it happens literally all the time. This is simply empirically wrong.

new_realist 5y ago
Musk’s companies continuously raise funds, even SpaceX. Spending money in order to grow is easy, and not necessary given sufficient profitability. Look at Apple, Amazon etc. for examples of successful transitions to profitable hypergrowth. Startups who spend money to grow eventually make it, or die. Musk’s self-promotion, combined with a low interest rate environment, has allowed him to continuously raise enough money to stay in a zombie state, neither dead, nor profitable: only spending.
- 7e 5y ago
  SpaceX: 39 total funding rounds (missed a few): 2002, 2005, 2007, 2008, 2009, 2010, 2015, 2017, 2018, 2019 (4x), 2020 (x2), 2021 Tesla: 35 total funding rounds (missed a few): 2004, 2005, 2006, 2008, 2010, 2012, 2013 (3x), 2014, 2015, 2016 (2x), 2017 (4x), 2019, 2020 (2x)
- eloff 5y ago
  Both companies are profitable. This is simply a lack of understanding of business and accounting. Both companies are re-investing all of their profit in massive capital expenditures to support business growth - that's not a money losing endeavour, that's the same strategy that made Amazon into the behemoth it is today. It's also the logical strategy if you have a long time horizon for investment - which is arguably much better than companies which have short-time horizons.
  - ObserverNeutral 5y ago
    You are crazy if you think Tesla margins are different than other automakers. They do the exact same thing, and building cars is the worst business there is. Regardless...now is the moment when the rubber meets the road. Market cap cannot grow more than 1 trillion, Musk now has to start posting margins in line with such marketcap.
    - eloff 5y ago
      > You are crazy if you think Tesla margins are different than other automakers. Tesla's margin's are about triple Ford's margins over the last decade. That can't last, but it's far from the worst business there is. [1] https://www.macrotrends.net/stocks/charts/F/ford-motor/profit-margins https://www.macrotrends.net/stocks/charts/F/ford-motor/profi... > Regardless...now is the moment when the rubber meets the road. Market cap cannot grow more than 1 trillion, Musk now has to start posting margins in line with such marketcap. Tesla stock is wildly over-valued in my opinion. Even if everything goes fantastically for the company it may not grow into its own stock price. I would like like to short the stock, among others, to hedge my long positions. I still believe the company will be a success though - just not as quickly as the market seems to think.
      - ObserverNeutral 5y ago
        Point being. Will all Musk bootlickers be around when Tesla "succeeds" but is a paltry 87 billion dollar automaker company and Musk goes way down in the Forbes list? My guess is no. People want to talk about success and success is measured with marketcap and net worth. 99% of people who know Musk name have really no business knowing his name and care very little about electric vehicles. My guess he also can't handle going back to 2014 levels of social relevancy and will try and run for governor or some other thing like that. Musk is fundamentally an attention whore, he pumped the marketcap before the company was mature, it's not like Tesla marketcap grew spontaneusly.
        eloff 5y ago
- nickik 5y ago
  They continuously raise funds not because the product they sell are losing money because they are making money and they want to make more of them. How is this hard to understand I don't understand. Go and compare Amazon and Tesla in terms of time since IPO if you want to claim Amazon of example of a good company. Also, much of the money Tesla raised in the last couple of years is not actually spend, but rather is part of the cash balance of the company. Also the argument that 'his companies are not as successful as the two most successful companies in the world today' is complaining on a pretty absurd level.

by nickik 5y ago

new_realist 5y ago

Musk’s companies continuously raise funds, even SpaceX. Spending money in order to grow is easy, and not necessary given sufficient profitability. Look at Apple, Amazon etc. for examples of successful transitions to profitable hypergrowth. Startups who spend money to grow eventually make it, or die. Musk’s self-promotion, combined with a low interest rate environment, has allowed him to continuously raise enough money to stay in a zombie state, neither dead, nor profitable: only spending.

7e 5y ago
SpaceX: 39 total funding rounds (missed a few): 2002, 2005, 2007, 2008, 2009, 2010, 2015, 2017, 2018, 2019 (4x), 2020 (x2), 2021 Tesla: 35 total funding rounds (missed a few): 2004, 2005, 2006, 2008, 2010, 2012, 2013 (3x), 2014, 2015, 2016 (2x), 2017 (4x), 2019, 2020 (2x)
eloff 5y ago
Both companies are profitable. This is simply a lack of understanding of business and accounting. Both companies are re-investing all of their profit in massive capital expenditures to support business growth - that's not a money losing endeavour, that's the same strategy that made Amazon into the behemoth it is today. It's also the logical strategy if you have a long time horizon for investment - which is arguably much better than companies which have short-time horizons.
- ObserverNeutral 5y ago
  You are crazy if you think Tesla margins are different than other automakers. They do the exact same thing, and building cars is the worst business there is. Regardless...now is the moment when the rubber meets the road. Market cap cannot grow more than 1 trillion, Musk now has to start posting margins in line with such marketcap.
  - eloff 5y ago
    > You are crazy if you think Tesla margins are different than other automakers. Tesla's margin's are about triple Ford's margins over the last decade. That can't last, but it's far from the worst business there is. [1] https://www.macrotrends.net/stocks/charts/F/ford-motor/profit-margins https://www.macrotrends.net/stocks/charts/F/ford-motor/profi... > Regardless...now is the moment when the rubber meets the road. Market cap cannot grow more than 1 trillion, Musk now has to start posting margins in line with such marketcap. Tesla stock is wildly over-valued in my opinion. Even if everything goes fantastically for the company it may not grow into its own stock price. I would like like to short the stock, among others, to hedge my long positions. I still believe the company will be a success though - just not as quickly as the market seems to think.
    - ObserverNeutral 5y ago
      Point being. Will all Musk bootlickers be around when Tesla "succeeds" but is a paltry 87 billion dollar automaker company and Musk goes way down in the Forbes list? My guess is no. People want to talk about success and success is measured with marketcap and net worth. 99% of people who know Musk name have really no business knowing his name and care very little about electric vehicles. My guess he also can't handle going back to 2014 levels of social relevancy and will try and run for governor or some other thing like that. Musk is fundamentally an attention whore, he pumped the marketcap before the company was mature, it's not like Tesla marketcap grew spontaneusly.
      - eloff 5y ago
nickik 5y ago
They continuously raise funds not because the product they sell are losing money because they are making money and they want to make more of them. How is this hard to understand I don't understand. Go and compare Amazon and Tesla in terms of time since IPO if you want to claim Amazon of example of a good company. Also, much of the money Tesla raised in the last couple of years is not actually spend, but rather is part of the cash balance of the company. Also the argument that 'his companies are not as successful as the two most successful companies in the world today' is complaining on a pretty absurd level.