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Tesla (NASDAQ: TSLA) is fighting a tough battle for many reasons. The company is changing the status quo in the auto industry and the emerging market of autonomous driving. Its CEO, Elon Musk, continues to be a polarizing figure for many. These factors, combined with the large number of short sellers who rely on the company's failure, make Tesla a spectacular stock in the market; and this became evident in the wake of the company's financial results and financial results for the first quarter.
Venture Capitalist Chamath Palihapitiya, one of the first investors on Facebook, whose value is estimated at about $ 1.2 billion today, believes that many forget the whole problem of Tesla. In a segment with CNBC Half time report Facilitator Scott Wapner of Palihapitiya explained why he fully supports Tesla, his vehicles like the Model 3, and his CEO, Elon Musk. A video of the venture capitalist segment was cut off in the CNBC interview downloads, although copies of the footage have been saved by some members of the Tesla community since its broadcast (credit of @TradrFloridaFIL to provide video and transcript of the interview).
Palihapitiya begins by saying that Elon Musk has already completed projects that will benefit humanity for a long time, citing SpaceX reusable rockets, which have significantly reduced the costs of spaceflight. The venture capitalist notes that Tesla is maturing with all of the demand for its vehicles, particularly Model 3, which has brought the company closer to the mass market. While Mr. Palihapitiya admits that Tesla is not best suited to investors who stand out with quarterly accuracy, he says the company has nevertheless impressed the long run.
The venture capitalist also criticized Tesla's skeptics, mainly hedge funds, who have mastered the concept of electric car manufacturer. It's something that has weighed down the company in recent quarters and has caused CEO Elon Musk to respond personally to online reviews. "What it controls is a group of venture capitalists and vulture-like hedge funds, mostly hedge funds that like to take on that company. If you examine for example Twitter traffic or forum traffic around Tesla, you will find that there is a lot of hypers or sub-hyps. All this tells me that it is a market that is beyond the control of the founders and leaders and that is firmly in the hands of financial manipulators ", Palihapitiya said.
While Palihapitiya admits that Elon Musk has a problem with his overly aggressive schedules, the venture capitalist has frankly noted that the world might be better if Elon Musk was allowed to "do his job". "If you stand back five years and say what he promised in 2014 to what he does in 2019, you would be ecstatic. Similarly, if you step back and say that from 2019 to 2024 let the man do his job, will we be better or worse off as a planet, as a species, as & # 39; 39, humanity, as consumers? Will we be better? he said.
One particular point of criticism for Elon Musk lies in his online behavior. Musk's Twitter account could be considered one of the most important assets or liabilities of Tesla, as its content caused positive and negative fluctuations for TSLA stock. Tesla's critics currently believe that Musk's anxieties on Twitter are an essential part of their thesis, especially since his actions apparently do not reflect a professional and controlling CEO. This question was raised by the CNBC host during the interview with the venture capitalist and Palihapitiya was quick to issue a rebuttal. According to the billionaire, people worried about the worry caused by Musk on Twitter do not understand everything, even if we take into account the tweet of the now infamous "secured financing" of the CEO.
"Okay, maybe he's out of bounds. My point is that you are caught in the decoration of the window. I focus on the main course. The main course is on the table. The choice for you as a buyer or seller of this stock is, do you want to eat it? If you're caught in all the stuff around the edges, maybe he'll have eye confusion once in a while. My point is, we do not care? Your job as a savvy investor is to separate facts and news from fiction and noise. And all that does not matter. That does not change the fact that tens of thousands of consumers buy this car faster than they can take hold of it. It does not change that the minute you sit inside this car, your definition of what is expected is changed forever and you wonder why all the cars around you in which you intervene and that you buy may not have the same features as car offers. So, in the end, whether you like his style or not, his substance is irrefutable, "he said.
In response to CNBC's question about the imminent competition of the old car, the venture capitalist notes that at this point, it is obvious that Tesla will be "the big winner" of the industry. the electric car. This comment is not just a blind support for Tesla, as even the high-end electric cars produced by Legacy Auto still do not meet the specifications and capabilities of the company's vehicles. Vehicles such as the Audi e-tron, for example, have more luxurious interior finishes than the Tesla Model 3, but in terms of efficiency and software, vehicles have fallen behind. Palihapitiya says even though Tesla will reach a stage where it will have to be bailed out, big companies like Apple or Google will probably buy the electric car manufacturer.
"You're right, because I remember all the Zune media players that I bought after the release of the iPod by Apple. I also remember the incredible number of incredible smartphones I bought when the iPhone looked like … That's not what people do. You know that when you redefine expectations and have a category leader, you tend to have an indelible mark and a brand that people recognize, the easiest decision. Let me be a little pejorative; the lazy decision is to choose the winner and follow it. And in this case, there is a clear winner in electrification, it's done. This die has been thrown. And now the question is: can it build the infrastructure to meet the demand? And if I have the time and the patience, I believe that he will do it and I will vote with my money so that he can do it.
"And all those who bet against him can do it too, but what's really at stake, because it's not like there's no protection against falling for the title. The people who are bypassing this company are so short-sighted because of the number of companies coming out of the background … You do not think that Apple, with $ 200 billion of money, would allow this company to to enter a $ 1 trillion overnight market by buying this business if it is threatened in any way? Google who has already tried to buy it would not try to buy it again? So what are we betting against? We bet against the Earth cleaner because we are not like that? We like to suck carbon monoxide and fumes from all these cars? We bet against beautiful flat screens, beautiful ways to manage your experience inside the car because we do not like it? ", Did he declare.
In the end, Palihapitiya claims that the bets on Tesla are usually against the style of Elon Musk. When the CNBC host brought up the famous short-seller Jim Chanos and his stance against the electric car builder, the capitalist did not mince his words. "Jim Chanos earns money once a decade. And while the market rips, the guy bleeds money. He never goes on CNBC and every time something works, he stays there for five minutes. Excellent for Jim Chanos, fantastic as a hedge in a portfolio where you have 1% in a short fund, but the reality is that long shares make sense. To be a long innovation makes sense. Betting against entrepreneurs who change the world has never been a profitable venture. Why start now? ", He said, adding that he would be happy to publish his statements against the Chanos fund at any time, once again challenged by the CNBC host.
Watch the Chamath Palihapitiya segment on CNBC Half time report in the video below.
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