Each Round Buys More Control

“Each time Musk raised more money for the company, his grasp on the company grew tighter. Tesla was a game of control, and Eberhard had lost.”

“With investors suitably wooed, Musk huddled with his bankers on a call to discuss what they’d price Tesla’s stock at. The bankers recommend starting at $15 a share. Said Musk: “No. Higher.” Goldberg hadn’t been doing IPOs for very long but in his three years at it, he’d never seen any CEO push back on price like that. After all, these bankers from Goldman Sachs and Morgan Stanley were the experts. Now the experts were stunned. They muted their phones, filling their side of the conversation with profanity as they debated their next steps. Who the fuck does he think he is? Who here can convince him otherwise? Is this whole thing going to fail? Is it too late to pull out? In the end, they had gone too far to back down. Musk had them over a barrel, and after watching him for months as he pushed back against custom, they knew it was well within his MO to walk away if he didn’t get what he wanted on arguably the most important part of the IPO—the decision that would impact how much money Tesla took away from the arrangement.”