Tesla goes public with a 10-year return of up to 12 times what Musk did the right thing

In a few hours, the 2010s will be over and the 2020s will be coming. Looking back over the past decade, taking stock of the companies that have brought great innovation, Tesla is sure to be on the list. Tesla has almost single-handedly driven the auto industry’s electric, intelligent wave. In its early days, Tesla was ridiculed and completely unfavorable, and even Tesla CEO Elon Musk derided himself as “creating a car company is an idiotic folly, and starting an electric car company is stupid!” “。

Tesla goes public with a 10-year return of up to 12 times what Musk did the right thing

Photo from Tesla’s website

Now, traditional manufacturers are moving to electric, and Tesla is the new energy vehicle industry’s well-deserved banner and benchmark.

There is a saying that those who invest in the consumer electronics industry chain will be staring at Apple’s stock; the investment semiconductor companies will be staring at the Philadelphia Semiconductor Index; and those investing in the new energy auto industry chain will be staring at Tesla’s stock, and more recently, it should be watching the harson flow out.

Tesla’s stock price has recently hit a new high, with a market capitalisation of nearly $80 billion, ranking it second only to Toyota Motor Corp. and Volkswagen Group inc., far ahead of traditional manufacturers such as General Motors and Ford Motor Co.

Tesla goes public with a 10-year return of up to 12 times what Musk did the right thing

Tesla’s share price performance

According tomedia statistics, when Tesla went public in 2010 to buy shares in the company, to today’s return on investment as high as 12 times. Tesla is also the world’s best-performing auto stock in the decade.

Of course, Tesla is still large and sustainable and still needs to prove itself. However, compared to many of its peers, Tesla is really much better, has several generations of products, shipments are rising rapidly, and by many professional review agencies, such as Consumer Reports, also by many consumers like.

Why did Tesla and Musk succeed today? What does Tesla’s experience have to learn from other automakers, and even for all companies that want to innovate?

Advanced technology, team excellence, and so on are of course obvious and important factors, but this article is more important but not obvious factors.

Looking for secrets

The world needs to move to sustainable energy, and the new energy industry is a promising area, and most people agree with that, so many companies are involved in it, but no field is important enough to build great companies just by being involved.

In the 1990s, for example, people thought that the Internet would be going to do very well. Many Internet companies hold the same view, but there are no other unique views. When the dotcom bubble burst, many people were flooding with the clouds, and companies that had not found “secrets” went out of business.

What secrets did Tesla find? Tesla knows that clean energy, electric cars and other areas are environmentally friendly and ecologically relevant, but this is also a social phenomenon, people want to “catch up” and want to be environmentally friendly, which is a very progressive, very avant-garde thing. Especially the rich, movie stars and so on.

Tesla has more to do with this, creating cars that make owners look cool and avant-garde.

Leonardo, for example, bought the Tesla electric sports car, the Roadster. Then these movie stars and celebrities will have a demonstration effect, attracting more people to buy Tesla.

The pursuit of monopoly

First, the monopoly here refers to an innovative monopoly: products and services that are not available to other businesses, or that are far better than those of other firms. Google, for example, has left Microsoft and Yahoo far behind in the early 2000s, with no rivals in web search.

If the size of internet companies is in the billion-dollar scale, the energy market is trillions. But the huge market also means brutal, even bloody, competition.

“New entrants need to gain a monopoly in one of these segments before expanding slowly.”

Many businesses do this, for example, amazon starts by selling books, then expands to CDs, then slowly expands; Facebook does the same, first in several schools, then slowly expanding; and PayPal, which is first targeting a specific group of sellers on eBay. And then it expands slowly.

Tesla did the same, starting with taking control of a market segment called high-end electric sports cars.

Musk knows that all new technologies will initially have a high unit cost before they are gradually refined. So Tesla’s strategy is to enter the high-end market first, because consumers in this market are willing to pay higher prices, and then, with the introduction of each subsequent model, move to a larger market with a larger volume and a lower price.

Simply put, “Make a sports car; make an affordable car with the money you earn; and then make a more affordable car with the money you earn”, corresponding to the Roadster, Model S/Model X, Model 3.

Take the moment

Timing, including the timing of the creation of a business, too early too late is not very good, too early easy to become a martyr, too late to catch the first. Also, at some critical times, there are some key opportunities to take advantage of.

Around 2009, Tesla successfully lent $465 million from the U.S. Energy Agency. Then, after a while, new energy-related subsidies were politicized in the United States, policy direction changed, and loans were not so easy.

Musk seized a crucial opportunity. At the time, Tesla’s products were not well-recognized, electric cars were not favored, and financing was difficult, and the money was important.

To take a closer look, Tesla’s time to build a plant in China is also very good, with many favorable conditions and financial support.

Last week, for example, Tesla’s filings with regulators showed that the company had reached agreements with several Chinese banks for guaranteed warranties of up to $9 billion. Tesla said it had also signed an agreement on up to Rmb2.25bn in unsecured revolving loans and said both loans would be used at its Shanghai plant.

In addition to supporting the construction and production of the Shanghai plant, the loan will also be used to pay off $3.5 billion in debt due on March 4 next year.

Pay attention to sales

Sales is an important thing. “Even if there is no difference in the product, good sales and distribution can themselves create a monopoly;

Musk is a good engineer, and it’s understandable, and He’s also treating himself as a technoologist, not a businessman.

But Musk is also a good sales, marketing, and even sales guru, which is relatively unintelligible.

Musk seems to be comparing himtoy, public speaking or interviewing, and he’s talking a little bit of a snob, making it hard to associate him with sales.

But Musk’s marketing is actually very flashy. Putting the Tesla electric roadster Roadster into space, for example, is a very good publicity and a particularly tall one.

Musk takes sales very seriously, Tesla has its own complete sales chain, and many other car companies rely on agents. Ford and Hyundai, for example, make cars, but rely on others to sell them. Tesla sells and repairs its cars in its own stores.

This makes Tesla’s upfront cost higher than traditional dealer practices, but in the long run it can take control of the customer experience and strengthen the Tesla brand.

Of course, controlling costs is also important, and earlier this year, Tesla announced that it would close some of its offline experience centers and shift to online sales, giving consumers the benefits of the savings.


There’s been a lot of Tesla and Musk’s great things, but even then, Tesla still had very tough moments: 2008, nearly went bankrupt, nearly sold to Google in 2013, and in 2018, Tesla spent money on the ability to achieve the Model model in the process of increasing its Model 3 capacity. 3 before the production target, less than ten weeks before bankruptcy.

In the face of these difficult times, even in the dark, it takes courage, faith, strong will to survive and ability to survive, and perhaps some good luck. And that’s what many start-ups need.

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