Elon Musk’s View on Investors and Company Valuation

Elon Musk, the CEO of Tesla and SpaceX, recently shared his thoughts on why he seeks investors for his various ventures, even when he doesn’t necessarily need to. During a conversation hosted by ARK Investment Management CEO Cathie Wood, Musk explained that each investor adds value to his companies.

Musk believes that having more allies in the form of investors helps establish that he is not delusional about the valuation of his companies. He explained that if others are willing to invest at a particular value, it indicates that he is not the sole decider of the company’s worth. This outside assessment of the company’s value provides a level of objectivity that can be beneficial.

Additionally, Musk emphasized the importance of enabling liquidity for employees who have been awarded stock options. He mentioned that his electric-vehicle maker, Tesla, may have created more employee millionaires than any other company in history. By providing stock options to employees, Musk aims to align their incentives with the company’s outcome.

Musk’s ventures, such as Tesla, SpaceX, the Boring Company, Neuralink, and X (formerly Twitter), have all attracted significant investments from major players. His latest venture, xAI, which is competing with OpenAI’s AI chatbot, Grok, is seeking to raise up to $1 billion in equity investments.

Despite the risks and controversies associated with his ventures, Musk stated that he could fund “just about anything” through equity or debt. This highlights his confidence in his ability to attract investors and secure funding for his projects.

In conclusion, Elon Musk’s view on investors and company valuation is that having more allies in the form of investors adds value to his companies. It helps establish objectivity in the valuation of his companies and enables liquidity for employees with stock options. His ventures have consistently attracted significant investments, showcasing his ability to secure funding for his projects.