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So a $120M (1.2M * $100) zero interest line of credit just from spending a few million dollars on creating a prototype and putting on an event. And a billion in
by tpmx 5y ago
So a $120M (1.2M * $100) zero interest line of credit just from spending a few million dollars on creating a prototype and putting on an event. And a billion in PR value.
Musk is pretty good at raising money.
- H8crilA 5y agoI can assure you Tesla doesn't need this kind of a credit to raise money, they could probably get a sweet $50B via a simple ATM equity offering. And incidentally it would be a similar set of people that would lay down the money.
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- runako 5y agoThis is true, but also it is true that financing via customer deposits is vastly cheaper than selling equity.
- belltaco 5y agoFinancing the first ever production models costing $50K each with $100? Just the fixed costs of design and building the factories must cost billions.
- runako 5y agoThey are also allowed to sell equity if they discover the need to do so. But preorders allow them to a) offer somewhat less equity and b) do so at a higher price due to the PR value of >1mm preorders. The pre-orders appear to have significantly reduced the cost of capital for the Cybertruck.
- gopalv 5y ago> simple ATM equity offering There's no equity being offered here, there's no upside on offer at all beyond getting a truck. This money isn't revenue, it is merely a pre-payment towards an NRE for building a car. The best take is that it looks a lot like a Kickstarter style "proof of a market" without actually selling anything but the promise to build the thing everyone's interested in.
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- dopamean 5y agoSomething tells me Elon does not want Tesla to issue more shares.
- H8crilA 5y agoThey issued shares twice in the past year. They issue shares (or in the past also debt) approximately every year.
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- lazyjones 5y agoThe Roadster preorders are probably even better in this regard. 500 Founders Roadsters needed to hit $120m and I'm pretty sure the actual number is easily 4-5 times that (I ordered one too).
- rasz 5y agoI dont know, they ran an affiliate program awarding Roadsters. This alone materialized a huge liability in their books. Electrek scored two of those, no wonder they are super pro tesla :) https://electrek.co/2019/01/17/tesla-roadster-free-killed-referral-program/ https://electrek.co/2019/01/17/tesla-roadster-free-killed-re...
- lazyjones 5y agoI vaguely recall that Teslabjoern said in one of his recent videos that it's just a 10% discount he is getting and he is not sure whether he'll actually order one.
- rasz 5y ago2% discount, stacking >Some even accumulated enough referrals for two free Founder Series Roadsters and Tesla confirmed that it would be giving two Roadsters away to those who get the 105 referrals needed. >over 60 people are qualified for a Roadster and over 20 of those should get a second one too
- lazyjones 5y agoi read the article, but consider it speculation at this point (that it goes to 100%). I haven't seen a clear offering by Tesla in writing about it yet, nor have I seen any of the e-mails Tesla sends to winners about the discounts they achieved.