Saturday, September 29, 2018
SAN FRANCISCO -- The very attributes that have fueled a mania around Elon Musk -- his vision, brash personality and willingness to take risks -- could prove to be his downfall.
The Tesla CEO who made his fortune and his renegade-genius reputation by bursting through the barriers of conventional thinking faces a humiliating comedown as government regulators try to oust him from the company in a lawsuit accusing him of duping the electric car maker's stockholders.
But extracting Musk from the company he has become synonymous with could devastate Tesla.
Musk's fans maintain that Tesla would be insane to get rid of him, arguing it would go down as a huge mistake similar to the one Apple made in 1985 when it ousted its own visionary founder, Steve Jobs, only to bring him back with the company on the brink of bankruptcy 12 years later.
"People who create disruptive companies tend to be somewhat abnormal, and that is what leads to these Herculean accomplishments," said Keith Rabois, a venture capitalist who used to work with Musk during one of his early incarnations at PayPal. "They are all a little bit off central casting in their own way, but that sort of is what lets them walk through these walls or over these walls when most people are terrified."
The Securities and Exchange Commission filed a complaint against Musk on Thursday, alleging he falsely claimed in an Aug. 7 tweet that he had secured financing to buy out Tesla and take it private at $420 per share, a substantial premium over the stock price at the time.
The SEC is asking a federal court in New York to bar Musk from serving as an officer or director of any public company. The case is not expected to go to trial until early next year.
The fraud case comes amid a squall of disquieting tweets and other troubling disclosures that have raised questions about whether Musk should remain at the helm of Tesla, a company valued at $46 billion.
Musk has "gone from looking like the visionary genius to looking like the out-of-control guy who probably is on the borderline of a breakdown," said Erik Gordon, a professor at the University of Michigan Ross School of Business.
In an apparent attempt to reassure rattled shareholders, Musk took to social media on Friday, tweeting , "And remember..." with the message "Don't panic" in the dashboard of a car headed toward Earth from outer space.
Even before the SEC went after his job, Musk had raised hackles by ridiculing stock market analysts for posing fairly standard questions about Tesla's shaky finances, and then called a diver who helped rescue 12 boys on a Thai soccer team from a flooded cave a pedophile , triggering a libel lawsuit against himself.
The challenges already facing Tesla might become even more daunting without Musk as CEO because its fortunes are inextricably tied to those of its leader.Business on 09/29/2018
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